Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate any Asset Disposition unless: (i) the consideration the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than the fair market value of the assets disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors); and (ii) at least 75% of the consideration the Parent or such Restricted Subsidiary receives in respect of such Asset Disposition consists of: (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition); (B) Cash Equivalents; (C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition; (D) Replacement Assets; (E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b); (F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor; (G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or (H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G). (b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to: (i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary); (ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below); (iii) invest in any Replacement Assets; (iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary; (v) make a capital expenditure; (vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business; (vii) consummate any combination of the foregoing; or (viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date. (c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture. (d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof. (e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero. (f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency. (g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer. (h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture. (i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance. (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 2 contracts
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer any of its Restricted Subsidiaries to, directly or any other Restricted Subsidiary toindirectly, consummate any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other a Restricted Subsidiary receives for such Asset Disposition is not less than consideration at least equal to the fair market value of the assets disposed of Fair Market Value (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by Disposition), of the Parent’s Board of Directors); andassets and Equity Interests issued or sold pursuant to such Asset Disposition;
(ii2) at least 75% of the aggregate consideration received by the Parent Company or its Restricted Subsidiaries in the Asset Disposition and all other Asset Dispositions since the Issue Date is in the form of cash or Temporary Cash Investments, Additional Assets or any combination thereof (collectively, the “Cash Consideration”); provided that each of the following will be deemed to be cash:
(a) any liabilities, as shown on the Company’s most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Securities or any Subsidiary Guarantee) that are assumed, forgiven or otherwise extinguished by the transferee by written agreement that releases the Company or such Restricted Subsidiary receives in respect of from or indemnifies the Company or such Asset Disposition consists of:Restricted Subsidiary against further liability;
(Ab) cash (including with respect to any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of Oil and Gas Properties by the Company or any Restricted Subsidiary where the Company or such Restricted Subsidiary retains an interest in such property, the costs and expenses of the Company or such Restricted Subsidiary related to the exploration, development, completion or production of such properties and activities related thereto which the transferee (or an Affiliate thereof) agrees to pay;
(c) any securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Company or any liabilities recorded on Restricted Subsidiary from the Parent’stransferee that are, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date within 180 days of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if converted by the Parent, the Issuer and every other Company or such Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parentinto cash, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;cash received in that conversion; and
(Gd) any Designated Non-Cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstandingclause (d), not to exceed the greater of 15an amount equal to 7.5% of Consolidated EBITDA and $150 million the Company’s ACNTA (determined at the time of receipt of such Designated Non-Cash Consideration), with the fair market value Fair Market Value of each issue item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); orand
(H3) any combination an amount equal to 100% of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash from such Asset Disposition is applied by the Company (or a Restricted Subsidiary, as the case may be) within 365 days to:
(i) (a) prepay, repay, redeem or purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); Debt;
(b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtednessacquire Additional Assets; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or or
(c) prepaymake capital expenditures in a Permitted Business. The requirement of clauses (3)(b) and (3)(c) of the preceding paragraph of this Section 3.5 shall be deemed to be satisfied if a bona fide binding contract committing to make the investment, repay, purchase acquisition or redeem expenditure referred to therein is entered into by the Company (including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricesany Restricted Subsidiary of the Company) any Indebtedness of with a Person other than a Restricted Subsidiary of the Parent that Company within the time period specified in the preceding paragraph and such Net Available Cash is not a Guarantor (other than subsequently applied in accordance with such contract within six months following the Issuer) or any Indebtedness that date such agreement is secured on assets that do not constitute Collateral (in each caseentered into. Pending application of Net Available Cash pursuant to this Section 3.5, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders Subsidiary of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to Company may apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of temporarily reducing Indebtedness under any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings Credit Facility or otherwise utilize such invest the Net Available Cash in any manner that is not prohibited by the terms of this Indenture. The amount of Net Available Cash not applied or invested as provided above will constitute “Excess Proceeds.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if ” When the aggregate amount of Excess Proceeds equals or exceeds $60 50.0 million, the Issuer will be required within twenty (20) Business Days thereof to Company shall make an offer to purchase Securities and other Pari Passu Indebtedness of the Company (an “Asset Disposition Offer”) within 30 days, and shall purchase Securities tendered pursuant to all Holders and, to an Offer by the extent Company for the Issuer elects, to all or some holders of Securities (and such other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, Company) at an offer price, in respect a purchase price of the Notes, equal to no less than 100% of the their principal amount thereof without premium, plus accrued and but unpaid interest, if any, interest to, but not including, the date of purchase, subject to the right of Holders of record on the relevant record date to receive interest on the relevant interest payment date (or, in respect of such other Pari Passu Indebtedness of the Company, such lesser price, if any, as may be provided for by the terms of such Pari Passu Indebtedness of the Company) in accordance with the procedures (including prorating in the event of oversubscription) set forth below in this Section 3.5. Upon completion of an Asset Disposition Offer, Excess Proceeds will be deemed to be reset to zero. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Securities and Pari Passu Indebtedness required to be repaid or purchased by it pursuant to such offer this Section 3.5 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tenderedtendered and not properly withdrawn, all Notes Securities and Senior Indebtedness that is Pari Passu Indebtedness validly tendered and not properly withdrawn in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy . If the foregoing obligations with respect to any Net Available Cash from an Asset Disposition Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest, if any, will be paid to the Person in whose name a Security is registered at the close of business on such record date, and no further interest will be payable to Holders who tender Securities pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, to the extent necessary on a pro rata basis (except that any Securities represented by making an a Security in global form will be selected by such method as DTC or its nominee or successor may require or, where such nominee or successor is the Trustee, a method that most nearly approximates pro rata selection, unless otherwise required by law), the Asset Disposition Offer Amount of Securities and Pari Passu Indebtedness or portions of Securities and Pari Passu Indebtedness so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Securities and Pari Passu Indebtedness so validly tendered and not properly withdrawn, in each case in minimum principal amount of $2,000 and integral multiples of $1,000 in excess of $2,000; provided that if, following the repurchase of a portion of a Security, the remaining principal amount of such Security outstanding immediately after such repurchase would be less than $2,000, then the portion of such Security so repurchased shall be reduced such that the remaining principal amount of such Security outstanding immediately after such repurchase is $2,000. The Company will deliver to the Trustee an Officers’ Certificate stating that such Securities or portions thereof were accepted for payment by the Company in accordance with respect the terms of this Section 3.5 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Indebtedness. The Company or the paying agent, as the case may be, will promptly (but in any case not later than five Business Days after the termination of the Asset Disposition Offer Period) mail (or otherwise deliver in accordance with the applicable procedures of DTC) to each tendering Holder of Securities or holder or lender of Pari Passu Indebtedness, as the case may be, an amount equal to the purchase price of the Securities or Pari Passu Indebtedness so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Security, and the Trustee, upon delivery of an authentication order from the Company, will authenticate and mail or deliver such new Security to such Net Available Cash prior Holder, in a principal amount equal to any unpurchased portion of the Security surrendered; provided that each such new Security will be in a minimum principal amount of $2,000 or an integral multiple of $1,000 in excess of $2,000. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Indebtedness. Any Security not so accepted will be promptly mailed or delivered by the Company to the expiration Holder thereof. The Company will publicly announce the results of the relevant 360 days (or such longer period provided above) respect to all or part of Asset Disposition Offer on the Net Available Cash in advance of being required to do so by this Indenture.
(i) Asset Disposition Purchase Date. The Issuer Company will comply, to the extent applicable, with the requirements of Section 14(e) Rule 14e-1 of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this Indenturean Asset Disposition Offer. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.053.5, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)securities laws or regulations.
Appears in 2 contracts
Sources: Indenture (CNX Resources Corp), Indenture (CNX Resources Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the consideration the Parent, the Issuer Company (or such other Restricted Subsidiary Subsidiary, as the case may be) receives for consideration at the time of such Asset Disposition is not less than Sale at least equal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors)of; and
(ii2) at least 75% of the consideration received therefor by the Parent Company (or such Restricted Subsidiary receives Subsidiary, as the case may be) is in respect the form of such Asset Disposition consists ofcash or Cash Equivalents. For purposes of this provision, each of the following shall be deemed to be cash:
(A) cash any liabilities of the Company or any Restricted Subsidiary (including as shown on the most recent consolidated balance sheet of the Company and its Restricted Subsidiaries other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Net Cash Proceeds received Subsidiary Guaranty) that are assumed by the transferee of any such assets pursuant to an agreement that releases the Company or any such Restricted Subsidiary from the conversion within 180 days of further liability with respect to such Asset Disposition of liabilities;
(B) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents within 180 days (to the extent of the cash or Cash Equivalents received in consideration of such Asset Dispositionthat conversion);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock stock or assets of the kind referred to in clause (iv2) or (vi4) of paragraph (b) of this Section 4.05(b);4.06; and
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(GD) any Designated Non-Cash cash Consideration received by the Parent Company or any Restricted Subsidiary in such Asset Sale having an aggregate fair market value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (D) that is at any one that time outstanding, not to exceed $15 million at the greater time of 15% receipt of Consolidated EBITDA and $150 million (such Designated Non-cash Consideration, with the fair market value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If Within 365 days after the Parentreceipt of any Net Proceeds from an Asset Sale, the Issuer Company or any other such Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of may apply such Net Available CashProceeds, the Parent or at its Restricted Subsidiaries may use the Net Available Cash tooption:
(i1) (a) prepay, repay, purchase to repay or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any repurchase Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in of the preceding clause (i)(a), prepay, repay, purchase Company or redeem (including through open market purchases, voluntary tender offers any Subsidiary Guarantor or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a any Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary)Subsidiary Guarantor;
(ii2) purchase any series to make an Investment in (provided such Investment is in the form of Notes pursuant Capital Stock), or to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another a Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, Permitted Business if such Person is is, or becomes will become as a result thereof, a Restricted Subsidiary;
(v3) to make a capital expenditure;; or
(vi4) to acquire other long lived assets (other than Capital Stock and cash or Cash Equivalentssecurities) that are to be used or useful in a Similar Permitted Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” . Pending the final application of any such Net Available CashProceeds, the Parent or any Restricted Subsidiary Company may temporarily reduce the revolving credit borrowings Indebtedness under the Senior Credit Facilities or otherwise utilize invest such Net Available Cash Proceeds in any manner that is not prohibited by the terms of this Indenture.
(dc) On the 361st day Any Net Proceeds from Asset Sales that are not applied or invested as provided in paragraph (b) or the 541st day if a binding commitment as described in this Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if 4.06 will constitute "Excess Proceeds." When the aggregate amount of Excess Proceeds exceeds $60 10.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to purchase from all Holders (an "Asset Sale Offer") and, if applicable, redeem or purchase (or make an offer to do so) any other Senior Subordinated Indebtedness of the extent Company, the Issuer electsprovisions of which require the Company to redeem or purchase (or make an offer to do so) such Indebtedness with the proceeds from any Asset Sales, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum aggregate principal amount of Notes and any such other Senior Subordinated Indebtedness that may be purchased out of the (on a pro rata basis) with such Excess Proceeds, at an . The offer price, price for the Notes in respect of the Notes, any Asset Sale Offer will be equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, to the date of purchase. The Asset Disposition Offer in respect of Notes , and will be made payable in accordance with cash and the procedures redemption or purchase price for such other Senior Subordinated Indebtedness shall be as set forth in this Indenture, in minimum denominations the related documentation governing such Indebtedness. If any Excess Proceeds remain after consummation of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such an Asset Disposition Sale Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries Company may use such Net Available Cash Excess Proceeds for any purpose not prohibited by this the Indenture. If the aggregate amount purchase price of the Notes and such the other Senior Subordinated Indebtedness validly tendered and not properly withdrawn pursuant to an into such Asset Disposition Sale Offer exceeds the amount of Excess Proceeds, the Excess Proceeds Company shall select the Notes to be allocated among the tendering Holders of Notes and such other Senior Indebtedness purchased on a pro rata based on basis but in round denominations, which in the aggregate case of the Notes will be denominations of $2,000 initial principal amount and multiples of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period$1,000 thereafter. Upon completion of any each Asset Disposition Sale Offer, the amount of Excess Proceeds related to such Asset Sale Offer shall be reset at zero.
(f1) To Promptly, and in any event within 10 days after the extent Company becomes obligated to make an Asset Sale Offer, the Company shall deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that any portion the Holder may elect to have his Notes purchased by the Company either in whole or in part (subject to prorating as described in paragraph (c) of Net Available Cash payable this Section 4.06 in respect the event the Asset Sale Offer is oversubscribed) in a minimum amount of $2,000 or in larger integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Notes is denominated Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a currency minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Sales otherwise described in the currency offering materials (or corresponding successor reports), (B) a description of material developments in the Company's business subsequent to the date of the latest of such Reports, and (C) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Notes pursuant to the Asset Sale Offer, together with the information contained in clause (3).
(2) Not later than the date upon which written notice of an Asset Sale Offer is delivered to the relevant Notes are denominatedTrustee as provided above, the amount thereof payable in respect of such Notes Company shall not exceed deliver to the net Trustee an Officers' Certificate as to (A) the amount of funds the Asset Sale Offer (the "Offer Amount"), including information as to any other Senior Subordinated Indebtedness included in the currency in which such Notes are denominated that is actually received by Asset Sale Offer, (B) the Issuer upon converting such portion allocation of the Net Available Cash into from the Asset Sale pursuant to which such currency.
Asset Sale Offer is being made and (gC) the compliance of such allocation with the provisions of this Section 4.06. On such date, the Company shall also 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 Cash Equivalents, maturing on the last day prior to the Purchase Date or on the Purchase Date if funds are immediately available by open of business, an amount equal to the Offer Amount to be held for payment in accordance with the provisions of this Section. If the Asset Sale Offer includes other Senior Subordinated Indebtedness, the deposit described in the preceding sentence may be made with any other paying agent pursuant to arrangements satisfactory to the Trustee. Upon the expiration of the period for which the Asset Sale Offer remains open (the "Offer Period"), the Company shall deliver to the Trustee for cancellation the Notes or portions thereof which have been properly tendered to and are to be accepted by the Company. The Asset Disposition OfferTrustee shall, insofar as it relates on the Purchase Date, mail or deliver payment (or cause the delivery of payment) to each tendering Holder in the amount of the purchase price. In the event that the aggregate purchase price of the Notes delivered by the Company to the Trustee is less than the Offer Amount applicable to the Notes, will remain open the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(3) Holders electing to have a period of not less than five (5) Note purchased shall be required to surrender the Note, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days following its commencement (prior to the “Asset Disposition Offer Period”)Purchase Date. No Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than five (5) one Business Days after Day prior to the termination Purchase Date, a telex, facsimile transmission or letter setting forth the name of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”)Holder, the Issuer will purchase the principal amount of the Note which was delivered for purchase by the Holder and a statement that such Holder is withdrawing his election to have such Note purchased. Holders whose Notes and, are purchased only in part shall be issued new Notes equal in principal amount to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (unpurchased portion of the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offersurrendered.
(h4) The Parent and its Restricted Subsidiaries may satisfy At the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior time the Company delivers Notes to the expiration Trustee which are to be accepted for purchase, the Company shall also deliver an Officers' Certificate stating that such Notes are to be accepted by the Company pursuant to and in accordance with the terms of this Section. A Note shall be deemed to have been accepted for purchase at the relevant 360 days (time the Trustee, directly or such longer period provided above) respect through an agent, mails or delivers payment therefor to all or part of the Net Available Cash in advance of being required to do so by this Indenturesurrendering Holder.
(ie) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.06. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.06, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 4.06 by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)securities laws or regulations.
Appears in 2 contracts
Sources: Indenture (Leasehold Resource Group LLC), Indenture (SHG Holding Solutions Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is consideration (both cash and non cash) equal to not less than the fair market value of the assets disposed of as of Fair Market Value (such Fair Market Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andshares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents or Replacement Assets. For purposes of this clause (2), each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the face of the Company’s or such Restricted Subsidiary’s then most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and Subordinated Obligations) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:from further liability;
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in consideration that conversion) within 180 days of the closing of such Asset Disposition);; and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gc) any Designated Non-Cash Noncash Consideration received by the Parent Company or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value (as determined in good faith by the Board of Directors of the Company), taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (c) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 100.0 million (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); orand
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant3) an offer amount equal to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition:
(a) first, is applied by the Company or such Restricted Subsidiary, as the case may be,
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Bank Indebtedness) to prepay, repay or purchase Bank Indebtedness of the Company or of a Restricted Subsidiary within 365 days from the date of such commitment until the earlier of Asset Disposition (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of “Application Period”), unless to the extent such Net Available Cash not is otherwise used in accordance with clause (ii); provided, however, that, in connection with any prepayment, repayment or purchase of any such Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so used prepaid, repaid or purchased, or
(ii) to the extent the Company or any Restricted Subsidiary, as the case may be, elects, to invest in Replacement Assets within the applicable Application Period; and
(b) second, to the extent of the balance of the Net Available Cash after application in accordance with (a) above (such balance, “Excess Proceeds”), is applied by the Company or such Restricted Subsidiary, as the case may be, toward an offer to purchase Notes as set forth above constitutes “Excess Proceeds.” Pending in the next succeeding paragraph; provided, however, that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) . On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time date, if any, as the Issuer electsBoard of Directors of the Company or such Restricted Subsidiary determines that the Net Available Cash will not be applied in accordance with clause (3)(a) of the first paragraph of this Section 4.15), if the aggregate amount of Excess Proceeds exceeds $60 50.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (an “Asset Disposition Offer”) to all Holders of Notes and, to the extent required by the Issuer electsterms of other Senior Indebtedness, to all or some holders of other outstanding Senior Indebtedness that is outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Indebtedness with the proceeds from any Asset Disposition (“Pari Passu Indebtedness, Notes”) to purchase the maximum principal amount of such Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indentureherein or the agreements governing the Pari Passu Notes, in minimum denominations of $200,000 and as applicable, in integral multiples of $1,000 in excess thereof.
principal amount (e) Upon completion provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such Asset Disposition Offer, other integral multiples as may be specified in the agreements governing the Pari Passu Notes. To the extent that the aggregate amount of Excess Proceeds that resulted in the requirement Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offerfor general corporate purposes, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by subject to other covenants contained in this Indenture. If the aggregate principal amount of such Notes and such other Senior Indebtedness Pari Passu Notes validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the portions of such Excess Proceeds to be applied to purchase such tendered Notes and Pari Passu Notes shall be allocated among determined by the tendering Holders of Notes and such other Senior Indebtedness Company on a pro rata based basis on the basis of the aggregate principal amount of such tendered Notes and Pari Passu Notes (subject to such other Senior Indebtedness adjustments as the Company in its sole discretion shall deem appropriate so tendered that Notes are purchased in integral multiples of $1,000 in principal amount and the unpurchased portion of any Note shall not properly withdrawn. For be less than $2,000 in principal amount and so that, in the purposes case of calculating Pari Passu Notes issued in authorized denominations, such Pari Passu Notes are purchased only in authorized denominations and the unrepurchased portion of any such Pari Passu Note shall also be an authorized denomination) and in such case the specific Notes to be purchased shall be selected, in the case of Global Notes, in accordance with the applicable procedures of the Depository (and, if permitted under such procedures, on a pro rata basis on the basis the aggregate principal amount of any such Indebtedness tendered Notes) and, in an Asset Disposition Offer the case of Notes that is are not denominated in U.S. dollarGlobal Notes, such by the Trustee on a pro rata basis on the basis of the aggregate principal amount of such Notes (and in each case subject to such adjustments as shall be converted into its U.S. Dollar Equivalent as necessary so that Notes are purchased in integral multiples of a date selected by $1,000 in principal amount and the Issuer that is within unrepurchased portion of any Note shall not be less than $2,000 in principal amount), and the Asset Disposition Offer Period or no more than five (5) Business Days prior selection of the specific Pari Passu Notes to be purchased shall be made pursuant to the beginning terms of the Asset Disposition Offer Periodsuch Pari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The . Each Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness and Pari Passu Notes required to be repaid or purchased by it pursuant to such offer this Section 4.15 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness Notes validly tendered in response to the Asset Disposition Offer.. Upon the commencement of an Asset Disposition Offer, the Company shall send, by first class mail, a notice to the Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Asset Disposition Offer. Any Asset Disposition Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:
(h1) that the Asset Disposition Offer is being made pursuant to this Section 4.15;
(2) the Asset Disposition Offer Amount and the Asset Disposition Purchase Date;
(3) that any Notes not tendered or accepted for payment shall continue to accrete or accrue interest;
(4) that, unless the Company defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrete or accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to the Asset Disposition Offer may only elect to have all of such Note purchased and may not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Asset Disposition Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by book-entry transfer, to the Company, a depository, if appointed by the Company, or the Paying Agent at the address specified in the notice at least three days before the Asset Disposition Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the Company, the Depository or the Paying Agent, as the case may be, receives, not later than the second business day prior to the Asset Disposition Purchase Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased);
(9) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(10) all other procedures, if any, determined by the Company, consistent with this Indenture, that a Holder must follow in order to have its Notes purchased in the Asset Disposition Offer. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, any accrued and unpaid interest will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of such Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in integral multiples of $1,000 in principal amount (provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such other integral multiples as may be specified in the agreements governing such Pari Passu Notes. The Parent Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4.15 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Notes. Any Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Disposition Offer on or promptly following the Asset Disposition Purchase Date. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries may satisfy as an entirety to a Person in a transaction permitted under Article 5, which transaction does not constitute a Change of Control, the foregoing obligations successor company shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Disposition. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Available Cash prior to the expiration for purposes of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) Section 4.15. The Issuer Company will comply, to the extent applicable, with the requirements of Section Rule 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.15. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.15, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such complianceany conflict.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 2 contracts
Sources: Indenture (Davita Healthcare Partners Inc.), Indenture (Physicians Choice Dialysis, LLC)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Borrower shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Borrower or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors)the shares and assets subject to such Asset Disposition; and
(ii2) at least 75% of the consideration therefor received by the Parent Borrower or such Restricted Subsidiary receives is (i) to the extent the assets subject to such Asset Disposition do not constitute Collateral under this Agreement, in the form of cash or Additional Assets, or (ii) to the extent the assets subject to such Asset Disposition do constitute Collateral under this Agreement, in the form of cash or assets that are included in the Collateral.
(b) For the purposes of this covenant, the following are deemed to be cash:
(1) the assumption of Indebtedness or other obligations of the Borrower (other than obligations in respect of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date Disqualified Stock of the latest balance sheet, that would be recorded on the next balance sheetBorrower) or any Restricted Subsidiary (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated obligations in respect of such liabilities, or (y) Indebtedness Disqualified Stock and Preferred Stock of a Restricted Subsidiary that is no longer a Subsidiary Guarantor) and the release of the Borrower or such Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of all liability on such Indebtedness as a result of or obligations in connection with such Asset Disposition;
(D2) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only except to the extent that such Indebtedness (i) has been extinguished by the Issuer or assets subject to the applicable GuarantorAsset Disposition constitute Collateral under this Agreement, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Noncash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market valueFair Market Value that, when taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant that is at any one time clause and then outstanding, does not to exceed at the greater time of 15% the receipt of Consolidated EBITDA and $150 million such Designated Noncash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
) the greater of (H1) any combination $200,000,000 and (2) 1.5% of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) total Consolidated assets of the later Borrower as shown on the most recent balance sheet of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance Borrower filed with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary)SEC;
(ii3) purchase any series of Notes pursuant to an offer to all Holders of such series of Notessecurities, redeem (including through open market purchases, voluntary tender offers notes or privately negotiated transactions at market prices) any series of Notes pursuant to similar obligations received by the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent Borrower or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner from the transferee that is not prohibited are promptly converted by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Borrower or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders Restricted Subsidiary into cash; and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 2 contracts
Sources: Second Lien Credit Agreement (Goodyear Tire & Rubber Co /Oh/), Second Lien Credit Agreement (Goodyear Tire & Rubber Co /Oh/)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); andthe shares and assets subject to such Asset Disposition,
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in the form of cash, assets useful in a Permitted Business, or the assumption by the purchaser of liabilities of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) as a result of which the Company and the Restricted Subsidiaries are no longer obligated with respect to those liabilities; provided that the amount of any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Disposition shall be deemed to be cash for the purposes of this provision (but for no other purpose) so long as such amount, taken together with the Fair Market Value when received of all other Designated Noncash Consideration that is at that time outstanding (i.e., that has not been sold for or otherwise converted into cash or Permitted Securities), does not exceed the greater of (i) $150,000,000 and (ii) 6% of Consolidated Tangible Assets as of the last day of the most recent fiscal quarter; provided, further, that (A) securities or other assets received by the Company or any Restricted Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days after the closing of such Asset Disposition shall be considered to be cash to the extent of the cash received in that conversion; and (B) any cash consideration paid to the Company or the Restricted Subsidiary in connection with the Asset Disposition that is held in escrow or on deposit to support indemnification, adjustment of purchase price or similar obligations in respect of such Asset Disposition consists ofshall be considered to be cash, and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) within 365 days after the later of the date of such Asset Disposition and the receipt of such Net Available Cash:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesto prepay, notes repay, purchase, repurchase, redeem, retire, defease or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date otherwise acquire for value Secured Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or a Subsidiary Guarantor (other than any Disqualified Stock or Subordinated Indebtedness), as a result of which none of the Parent, the Issuer Obligations) or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer not a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of in each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (case other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any an Affiliate of the Company;
(B) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes; provided, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(vin accordance with this clause (B) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted an application of the such Net Available Cash from the date of such commitment until if (i) such reinvestment is consummated within 180 days at the earlier end of such 365 day period referred to in this clause (x3) the date on which such investment is consummated, and (yii) if such reinvestment is not consummated within the 180th day following period set forth in subclause (i) or such binding commitment is terminated, the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such shall constitute available Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.; or
(dC) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”i) to all Holders and, to redeem the extent the Issuer elects, to all Notes of either series or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, make open market purchases thereof at an offer price, in respect of the Notes, equal to no a price not less than 100% of the principal amount thereof or (ii) to make an Asset Disposition Offer to purchase Notes of such series pursuant to and subject to the conditions set forth in Section 4.10(b); provided, however, that if the Company elects (or is required by the terms of any Pari Passu Indebtedness), such Asset Disposition Offer may be made ratably (determined based upon the respective principal amounts of the Notes of such series and such Pari Passu Indebtedness being purchased or repaid) to purchase the Notes of such series and to purchase or otherwise repay such Pari Passu Indebtedness; provided that pending final application of any such Net Available Cash in accordance with clause (3)(A), (B) or (C) above, the Company and the Restricted Subsidiaries may temporarily reduce revolving Indebtedness outstanding under the Existing Credit Agreement or otherwise invest such Net Available Cash in any manner not prohibited by this Indenture. To the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) above, the Company or such Restricted Subsidiary, as the case may be, may use such balance for any general corporate purpose not prohibited by the terms of this Indenture. In connection with any prepayment, repayment, purchase, repurchase, redemption, retirement, defeasance or other acquisition for value of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary, as the case may be, will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid, purchased, repurchased, redeemed, retired, defeased or otherwise acquired for value. Notwithstanding the foregoing provisions of this Section 4.10, the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this covenant exceeds $100,000,000.
(b) In the event of an Asset Disposition that requires the purchase of Notes of either series pursuant to Section 4.10(a)(3)(C), the Company will be required
(i) to purchase Notes of such series tendered pursuant to an offer by the Company for the Notes of such series (the “Asset Disposition Offer”) at a purchase price of 100% of their principal amount plus accrued and unpaid interest, if any, to, but not including, interest thereon to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made Holders of record on the relevant date to receive interest due on the relevant Interest Payment Date) in accordance with the procedures procedures, including prorating in the event of oversubscription, set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.and
(eii) Upon completion to purchase or otherwise repay Pari Passu Indebtedness of the Company on the terms and to the extent contemplated thereby at the purchase price set forth in the relevant documentation (including accrued and unpaid interest to the date of acquisition, the “purchase price”), provided that to the extent the purchase price of any such Pari Passu Indebtedness exceeds 100% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of acquisition, the Company shall not use any Net Available Cash to pay such purchase price, except as permitted by the next sentence. If the aggregate purchase price of Notes of either series and Pari Passu Indebtedness tendered pursuant to the Asset Disposition OfferOffer is less than the Net Available Cash allotted to the purchase of the Notes of such series and Pari Passu Indebtedness, the amount Company will apply the remaining Net Available Cash for any general corporate purpose not prohibited by the terms of Excess Proceeds that resulted in the requirement this Indenture. The Company will not be required to make an Asset Disposition Offer shall for Notes of either series and Pari Passu Indebtedness pursuant to this Section 4.10 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 4.10(a)(3)(A) and (B)) is less than $100,000,000 for any particular Asset Disposition (which lesser amount will be reset carried forward for purposes of determining whether an Asset Disposition Offer is required with respect to zero (regardless of whether there are the Net Available Cash from any remaining Excess Proceeds upon such completionsubsequent Asset Disposition). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount Net Available Cash in respect of Excess Proceeds any Asset Disposition(s) shall be reset at reduced to zero.
(fc) To (i) Promptly, and in any event within 20 days after the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Company becomes obligated to make an Asset Disposition Offer, insofar as it relates the Company shall be obligated to deliver to the Trustee and send or, at the request of the Company have the Trustee send (such notice to be provided to the Trustee at least five Business Days before the Trustee is requested to send such notice unless a shorter period shall be satisfactory to the Trustee), in the name and on behalf of the Company, by first-class mail to each Holder, or in the case of Global Notes, will remain open for send in accordance with the Applicable Procedures of the Depositary, a period written notice stating that the Holder may elect to have its Notes of not less than five either series purchased by the Company either in whole or in part (5) Business Days following its commencement (subject to prorating as hereinafter described in the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of event the Asset Disposition Offer Period is oversubscribed) in minimum denominations of $2,000 of principal amount or any greater integral multiple of $1,000 thereof, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the “Asset Disposition Purchase Date”) and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports); provided that in lieu of providing the reports specified in this subclause (1), the Issuer will purchase Company may, at its option, notify the principal amount holders that such reports are available to them in electronic format through the SEC’s ▇▇▇▇▇ system, (2) a description of Notes and, material developments in the Company’s business subsequent to the extent it electsdate of the latest of such reports, Senior Indebtedness required and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to be repaid or purchased by it tender Notes pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, together with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations address referred to in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
clause (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notesiii).
Appears in 1 contract
Sources: Indenture (Qorvo, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Borrower shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Borrower or such other Restricted Subsidiary receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (including as to the value of all non-cash consideration) of the shares and assets disposed of as of the date of entry into binding documentation in respect of subject to such Asset Disposition (Disposition, as determined in good faith by the Parent’s Board of Directors); and, if the fair market value is equal to or exceeds $2.5 million, or by an Officer, if the fair market value is less than $2.5 million;
(ii2) at least 75% of the consideration the Parent thereof received by Borrower or such Restricted Subsidiary receives is in the form of cash or cash equivalents;
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by Borrower (or such Restricted Subsidiary, as the case may be) to the extent and as set forth in Section 2.11 hereunder. For the purposes of this Section 4.06, the following are deemed to be cash or cash equivalents:
(i) the assumption or discharge of Indebtedness of Borrower (other than obligations in respect of such Asset Disposition consists of:
(ADisqualified Stock of Borrower) cash (including or any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) Subsidiary (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated obligations in respect of such liabilities, Disqualified Stock or (y) Indebtedness Preferred Stock of a Subsidiary Guarantor) and the release of Borrower or such Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of all liability on such Indebtedness as a result of in connection with such Asset Disposition;
(Dii) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer securities received by Borrower or any Guarantor received Restricted Subsidiary from Persons who the transferee that are not the Parentconverted within 90 days by Borrower or such Restricted Subsidiary into cash, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;cash received in that conversion; and
(Giii) any Designated Non-Cash cash Consideration received by the Parent Borrower or any Restricted Subsidiary in an Asset Disposition having an aggregate fair market value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant that is at any one time outstandingclause (iii) (unless such Designated Non-cash Consideration has been converted into cash, which shall be treated after such conversion as Net Available Cash), not to exceed the greater of 152.5% of Consolidated EBITDA and $150 million (with Total Assets at the fair market value time of each issue the receipt of such Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)cash Consideration.
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Loan and Security Agreement (Commercial Vehicle Group, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition following the Issue Date unless:
(i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at least equal to the Fair Market Value (such Asset Disposition is not less than the fair market value of the assets disposed of Fair Market Value to be determined as of the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors)assets subject to such Asset Disposition; and
(ii) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents. The Company shall determine the Fair Market Value of any consideration from such Asset Disposition that is not cash or Cash Equivalents.
(b) For the purposes of this Section 3.7, the following are deemed to be cash: (x) the assumption of Indebtedness or other liabilities of the Company (other than Disqualified Stock or Junior Indebtedness) or Indebtedness or other liabilities of any Restricted Subsidiary (other than Disqualified Stock or Junior Indebtedness) and the release of the Company or such Restricted Subsidiary receives from all liability on such Indebtedness or liabilities in respect of connection with such Asset Disposition consists of:
Disposition, (Ay) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other similar obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Company or any liabilities recorded on Restricted Subsidiary from the Parent’s, transferee that are converted within 180 days by the Issuer’s Company or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, into cash and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gz) any Designated Non-Cash cash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market valueFair Market Value (determined in Good Faith by the Company), taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (z) that is at any one that time outstanding, not to exceed $50.0 million at the greater time of 15% the receipt of Consolidated EBITDA and $150 million such Designated Non-cash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (McClatchy Co)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is consideration (both cash and non cash) equal to not less than the fair market value of the assets disposed of as of Fair Market Value (such Fair Market Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andshares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents or Replacement Assets. For purposes of this clause (2), each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the face of the Company’s or such Restricted Subsidiary’s then most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and Subordinated Obligations) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:from further liability; and
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in consideration that conversion) within 180 days of the closing of such Asset Disposition);; and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gc) any Designated Non-Cash Noncash Consideration received by the Parent Company or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value (as determined in good faith by the Board of Directors of the Company), taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (c) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 100.0 million (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); orand
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant3) an offer amount equal to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition:
(a) first, is applied by the Company or such Restricted Subsidiary, as the case may be,
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Bank Indebtedness) to prepay, repay or purchase such Bank Indebtedness of the Company or of a Restricted Subsidiary within 365 days from the date of such commitment until the earlier of Asset Disposition (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of “Application Period”), unless to the extent such Net Available Cash not is otherwise used in accordance with clause (ii); provided, however, that, in connection with any prepayment, repayment or purchase of any such Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so used prepaid, repaid or purchased, or
(ii) to the extent the Company or any Restricted Subsidiary, as the case may be, elects, to invest in Replacement Assets within the applicable Application Period; and
(b) second, to the extent of the balance of the Net Available Cash after application in accordance with (a) above (such balance, “Excess Proceeds”), is applied by the Company or such Restricted Subsidiary, as the case may be, toward an offer to purchase Notes as set forth above constitutes “Excess Proceeds.” Pending in the next succeeding paragraph; provided, however, that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) . On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time date, if any, as the Issuer electsBoard of Directors of the Company or such Restricted Subsidiary determines that the Net Available Cash will not be applied in accordance with clause (3)(a) of the first paragraph of this Section 4.15), if the aggregate amount of Excess Proceeds exceeds $60 50.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders of Notes and, to the extent required by the Issuer electsterms of other Senior Indebtedness, to all or some holders of other outstanding Senior Indebtedness that is outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Indebtedness with the proceeds from any Asset Disposition (“Pari Passu Indebtedness, Notes”) to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indentureherein or the agreements governing the Pari Passu Notes, as applicable, in minimum denominations of $200,000 and each case in integral multiples of $1,000 in excess thereof.
principal amount (e) Upon completion provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such Asset Disposition Offer, other integral multiples as may be specified in the agreements governing the Pari Passu Notes. To the extent that the aggregate amount of Excess Proceeds that resulted in the requirement Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offerfor general corporate purposes, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by subject to other covenants contained in this Indenture. If the aggregate principal amount of Notes and such other Senior Indebtedness Pari Passu Notes validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee, in accordance with (in the case of Global Notes) the applicable procedures of the Depository, shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness the holders, trustees or similar representatives, as the case may be, of Pari Passu Notes shall select the Pari Passu Notes to be purchased on a pro rata based basis on the basis of the aggregate principal amount of such tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The . Each Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness and Pari Passu Notes required to be repaid or purchased by it pursuant to such offer this Section 4.15 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness Notes validly tendered in response to the Asset Disposition Offer.. Upon the commencement of an Asset Disposition Offer, the Company shall send, by first class mail, a notice to the Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Asset Disposition Offer. Any Asset Disposition Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:
(h1) that the Asset Disposition Offer is being made pursuant to this Section 4.15;
(2) the Asset Disposition Offer Amount and the Asset Disposition Purchase Date;
(3) that any Notes not tendered or accepted for payment shall continue to accrete or accrue interest;
(4) that, unless the Company defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrete or accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to the Asset Disposition Offer may only elect to have all of such Note purchased and may not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Asset Disposition Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by book-entry transfer, to the Company, a depository, if appointed by the Company, or the Paying Agent at the address specified in the notice at least three days before the Asset Disposition Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the Company, the Depository or the Paying Agent, as the case may be, receives, not later than the second business day prior to the Asset Disposition Purchase Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased);
(9) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(10) all other procedures, if any, determined by the Company, consistent with this Indenture, that a Holder must follow in order to have its Notes purchased in the Asset Disposition Offer. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, any accrued and unpaid interest will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of such Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in each case in integral multiples of $1,000 in principal amount (provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such other integral multiples as may be specified in the agreements governing such Pari Passu Notes. The Parent Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4.15 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Notes. Any Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Disposition Offer on or promptly following the Asset Disposition Purchase Date. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries may satisfy as an entirety to a Person in a transaction permitted under Article 5, which transaction does not constitute a Change of Control, the foregoing obligations successor company shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Disposition. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Available Cash prior to the expiration for purposes of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) Section 4.15. The Issuer Company will comply, to the extent applicable, with the requirements of Section Rule 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.15. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.15, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such complianceany conflict.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Davita Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
: (i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (at least equal to the fair market value, as determined in good faith by the Parent’s Board of DirectorsDirectors (including as to the value of all non-cash consideration), of the shares and assets subject to such Asset Disposition; and
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
, Additional Assets (C) the assumption value of which shall be determined conclusively by the purchaser Board of Directors acting in good faith, such determination to be accompanied by a fairness opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing if such fair market value is estimated to exceed $50 million) or any combination thereof (x) any liabilities recorded on the Parent’s"Permitted Consideration"); provided, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheethowever, that would the Company and its Restricted Subsidiaries shall be recorded on permitted to receive Property (the next balance sheetvalue of which shall be determined conclusively by the Board of Directors acting in good faith, such determination to be accompanied by a fairness opinion or appraisal issued by an accounting, appraisal or investment banking firm of national standing if such fair market value is estimated to exceed $50 million) (other than Subordinated Indebtedness)Permitted Consideration, so long as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with as so determined, of all such Property other Designated Non-Cash than Permitted Consideration received pursuant to this covenant that is from Asset Dispositions and held by the Company and the Restricted Subsidiaries at any one time outstanding, shall not to exceed the greater of 1510% of Adjusted Consolidated EBITDA Net Tangible Assets; and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect 3) an amount equal to subsequent changes in value); or
(H) any combination 100% of the types of consideration specified in Net Available Cash from such Asset Disposition is applied by the preceding clauses Company or such Restricted Subsidiary, as the case may be: (ii)(AA) through (ii)(G).
(b) If first, to the Parent, extent the Issuer Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Senior Indebtedness), to prepay, repay or purchase Senior Indebtedness or Indebtedness (other than any Preferred Stock) of a Restricted Subsidiary consummates (in each case other than Indebtedness owed to the Company or an Asset Disposition, Affiliate of the Company) within 360 days (or such period as provided in clause (viii) below, if applicable) of from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Parent Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; provided that, prior to such retirement, the Company or its Restricted Subsidiaries may use temporarily repay Senior Indebtedness with the Net Available Cash to:
Cash; and (iB) (a) prepaysecond, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in to the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary extent of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount balance of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending after application in accordance with clause (a), to the final application extent the Company or such Restricted Subsidiary elects, to invest in Additional Assets within 360 days from the later of any the date of such Asset Disposition or the receipt of such Net Available Cash; provided that, prior to such investment, the Parent Company or any its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings or otherwise utilize such repay Senior Indebtedness with the Net Available Cash.
(b) Any Net Available Cash from Asset Sales that are not applied or invested as provided in any manner that is not prohibited by the terms of this IndentureSection 3.6(a) will be deemed to constitute "Excess Proceeds.
(d) " On the 361st day (after the later of the Asset Disposition or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as receipt of the Issuer electsNet Available Cash, if the aggregate amount of Excess Proceeds exceeds $60 10.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“"Asset Disposition Sale Offer”") to all Holders and, holders of Securities and to the extent required by the Issuer electsterms thereof, to all or some holders of other outstanding Senior Indebtedness that is outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Indebtedness with the proceeds from any Asset Disposition ("Pari Passu IndebtednessSecurities"), to purchase the maximum principal amount of Notes Securities and any such other Senior Indebtedness Pari Passu Securities to which the Asset Sale Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof (or the accreted value of any such Pari Passu Securities, if they were issued at a discount) plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this IndentureIndenture or the agreements governing the Pari Passu Securities, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, as applicable. To the amount of Excess Proceeds extent that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes Securities and such other Senior Indebtedness Pari Passu Securities so validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds for general corporate purposes, subject to the other covenants contained in this Indenture. If the aggregate principal amount of Securities surrendered by Holders thereof and other Pari Passu Securities (or the accreted value of any such Pari Passu Securities, if they were issued at a discount) surrendered by holders or lenders thereof, collectively, exceeds the amount of Excess Proceeds, the Excess Proceeds Company shall select the Securities and Pari Passu Securities to be allocated among the tendering Holders of Notes and such other Senior Indebtedness purchased on a pro rata based basis on the basis of the aggregate principal amount of Notes tendered Securities and such other Senior Indebtedness so tendered and not properly withdrawn. For Pari Passu Securities (or the purposes of calculating the principal amount accreted value of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollarPari Passu Securities, such principal amount shall be converted into its U.S. Dollar Equivalent as of if they were issued at a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Perioddiscount). Upon completion of any such Asset Disposition Sale Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g1) The Asset Disposition Offer, insofar as it relates to the Notes, Sale Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “"Asset Disposition Sale Offer Period”"). No later than five (5) Business Days after the termination of the Asset Disposition Sale Offer Period (the “"Asset Disposition Sale Purchase Date”"), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness Securities and Pari Passu Securities required to be repaid or purchased by it pursuant to such offer this covenant (the “"Asset Disposition Sale Offer Amount”") or, if less than the Asset Disposition Sale Offer Amount has been so validly tendered, all Notes Securities and Senior Indebtedness that is Pari Passu Indebtedness Securities validly tendered in response to the Asset Disposition Sale Offer.
(h2) The Parent If the Asset Sale Purchase Date is on or after an interest record date and its Restricted Subsidiaries may satisfy on or before the foregoing obligations with respect to related interest payment date, any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior accrued and unpaid interest will be paid to the expiration Person in whose name a Security is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Securities pursuant to the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this IndentureAsset Sale Offer.
(i3) On or before the Asset Sale Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Sale Offer Amount of Securities and Pari Passu Securities or portions thereof so validly tendered and not properly withdrawn pursuant to the Asset Sale Offer, or if less than the Asset Sale Offer Amount has been validly tendered and not properly withdrawn, all Securities and Pari Passu Securities so validly tendered and not properly withdrawn. The Company will deliver to the Trustee an Officers' Certificate stating that such Securities or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.6 and, in addition, the Company will deliver all certificates and Securities required, if any, by the agreements governing the Pari Passu Securities. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after the termination of the Asset Sale Offer Period) mail or deliver to each tendering Holder of Securities or holder or lender of Pari Passu Securities, as the case may be, an amount equal to the purchase price of the Securities or Pari Passu Securities so validly tendered and not properly withdrawn by such Holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Security, and the Trustee, upon delivery of an Officers' Certificate from the Company will authenticate and mail or deliver such new Security to such Holder, in a principal amount equal to any unpurchased portion of the Security surrendered. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Securities. Any Security not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Sale Offer on the Asset Sale Purchase Date. For the purposes of Section 3.6, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness (other than Subordinated Obligations or Disqualified Stock) of the Company or Indebtedness (other than Preferred Stock) of any Restricted Subsidiary of the Company and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition (in which case the Company will, without further action, be deemed 66 to have applied such deemed cash to Indebtedness in accordance with Section 3.6(a)(3)(A) above); and
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are promptly converted by the Company or such Restricted Subsidiary into cash.
(d) The Issuer Company will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.053.6, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Triton Energy LTD)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Symmetry shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition with respect to First-Priority Assets or the Non-ABL Intercompany Note Assets, unless:
(i1) the consideration the Parent, the Issuer Symmetry or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition at least equal to the Fair Market Value (including as determined by to the Parent’s Board value of Directors); andall non-cash consideration) of the shares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration the Parent received therefor by Symmetry or such Restricted Subsidiary receives is in respect the form of (A) cash or cash equivalents, (B) First-Priority Assets to be used in a Related Business, to the extent they are added to the First-Priority Collateral reasonably promptly after the acquisition, (C) in the case of Intercompany Note Collateral, Intercompany Note Assets to be used in a Related Business, to the extent that they are added to the Intercompany Note Collateral reasonably promptly after the acquisition, or (D) Capital Stock in one or more Persons engaged in a Related Business that are or thereby become Wholly Owned Subsidiaries;
(3) to the extent that Capital Stock of a Person is received by Symmetry and the Restricted Subsidiaries pursuant to clause (2)(D) above, assets of such Person that qualify as First-Priority Assets with a Fair Market Value equal to or greater than (A) 75% of the Fair Market Value of the First-Priority Assets that are the subject of such Asset Disposition consists ofless (B) the Fair Market Value of any consideration received by Symmetry and the Restricted Subsidiaries pursuant to clause (2)(A) or (B) above are added to the First-Priority Collateral reasonably promptly after the acquisition; and
(4) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by Symmetry or such Restricted Subsidiary, as the case may be:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesfirst, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer Symmetry or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market valueso elects, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, acquire Additional Assets within 360 365 days (or such period as provided in clause (viii) below, if applicable) of from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; provided that such Additional Assets constitute (x) First-Priority Assets that are added to the First-Priority Collateral reasonably promptly after their acquisition, (y) in the Parent case of Non-ABL Intercompany Note Assets, Non-ABL Intercompany Note Assets that are added to the Intercompany Note Collateral reasonably promptly after their acquisition, or its Restricted Subsidiaries may use (z) Capital Stock of a Wholly Owned Subsidiary with assets that qualify as First-Priority Assets to the extent that such First-Priority Assets, together with any First-Priority Assets described in clause (x) above and any assets comprising Intercompany Note Collateral described in clause (y) above, have a Fair Market Value equal to or greater than the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding applied pursuant to this clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricesA) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed First-Priority Assets are added to the Parent or any Restricted Subsidiary)First-Priority Collateral reasonably promptly after the acquisition;
(iiB) purchase any series of Notes pursuant to an offer to all Holders of such series of Notessecond, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders extent of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount balance of such Net Available Cash not so used as after application in accordance with clause (A) above, to make an offer to purchase the Securities and any Other First-Priority Obligations pursuant to and subject to the conditions set forth above constitutes “Excess Proceeds.” Pending in clause (d) of this Section 4.06; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B) above, for any general corporate purpose not restricted by the terms of this Indenture; provided that pending the final application of any such Net Available Cash, (x) in the Parent case of Net Available Cash from any Asset Disposition of First-Priority Assets, it is deposited in the Notes Collateral Account and pledged as additional First-Priority Collateral, and (y) in the case of Net Available Cash from any Asset Disposition of Non-ABL Intercompany Note Assets, it is deposited in the Intercompany Note Collateral Account and pledged as additional Intercompany Note Collateral.
(b) Symmetry shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition (other than an Asset Disposition subject to Section 4.06(a)), unless:
(1) other than in the case of any Permitted Factoring Transaction, Symmetry or such Restricted Subsidiary receives consideration at the time of such Asset Disposition at least equal to the Fair Market Value (including as to the value of all non-cash consideration) of the shares and assets subject to such Asset Disposition;
(2) at least 75% of the consideration received therefor by Symmetry or such Restricted Subsidiary is in the form of (A) cash or cash equivalents or (B) Additional Assets; and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by Symmetry (or such Restricted Subsidiary, as the case may be),
(A) first, to the extent that Symmetry or such Restricted Subsidiary so elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem or purchase any Credit Agreement Obligations or any Indebtedness (other than any Preferred Stock) of a Restricted Subsidiary (other than the Company) that is not a Subsidiary Guarantor (in each case other than Indebtedness owed to Symmetry or an Affiliate of Symmetry) within 365 days from the later of the date of such Asset Disposition or the receipt of such Net Available Cash;
(B) second, to the extent of the balance of such Net Available Cash after application in accordance with clause (A) above, to the extent Symmetry or such Restricted Subsidiary so elects, to acquire Additional Assets within 365 days from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B) above, to make an offer to the Holders (and to holders of other Senior Indebtedness of the Company designated by the Company) to purchase Securities (and such other Senior Indebtedness of the Company pursuant to and subject to the conditions contained in this Indenture and clause (d) of this Section 4.06); provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or (C) above, Symmetry or such Restricted Subsidiary shall cause the related loan commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this paragraph (b), Symmetry and the Restricted Subsidiaries shall not be required to apply any Net Available Cash from Asset Dispositions in accordance with this paragraph (b) except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this paragraph (b) exceeds $5,000,000. Pending application of Net Available Cash pursuant to this paragraph (b), such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily reduce revolving credit Indebtedness.
(c) For the purposes of this Section 4.06, the following are deemed to be cash or cash equivalents:
(1) the assumption or discharge of Indebtedness of Symmetry or any Restricted Subsidiary may temporarily reduce revolving credit borrowings (other than obligations in respect of Disqualified Stock of Symmetry or otherwise utilize Preferred Stock of a Subsidiary Guarantor or Novamerican Steel) and the release of Symmetry or such Net Available Cash Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition; provided that, with respect to any manner Asset Disposition subject to paragraph (a) above, such liabilities constituted trade payables or First-Priority Obligations; and
(2) any securities received by Symmetry or any Restricted Subsidiary from the transferee that is not prohibited are converted by Symmetry or such Restricted Subsidiary into cash within 90 days after such Asset Disposition, to the extent of the cash received in that conversion. For the purposes of this Section 4.06, any sale by Symmetry or a Restricted Subsidiary of the Capital Stock of a Restricted Subsidiary that owns assets constituting First-Priority Assets, Second-Priority Assets, Non-ABL Intercompany Note Assets or Canadian ABL Assets shall be deemed to be a sale of such First-Priority Assets, Second-Priority Assets, Non-ABL Intercompany Note Assets or Canadian ABL Assets (or, in the event of a Restricted Subsidiary that owns assets that include all or any combination of First-Priority Assets, Second-Priority Assets, Non-ABL Intercompany Note Assets or Canadian ABL Assets, a separate sale of each of such First-Priority Assets, Second-Priority Assets, Non-ABL Intercompany Note Assets and Canadian ABL Assets). If any such sale (or a sale of assets that includes all or any combination of First-Priority Assets, Second-Priority Assets, Non-ABL Intercompany Note Assets and Canadian ABL Assets), the proceeds received by Symmetry and the Restricted Subsidiaries in respect of such sale shall be allocated to the First-Priority Assets, Second-Priority Assets, Non-ABL Intercompany Note Assets and Canadian ABL Assets in accordance with their respective fair market values, which shall be determined by the terms Board of Directors of Symmetry or an independent third party. In addition, for purposes of this IndentureSection 4.06, any sale by Symmetry or any Restricted Subsidiary of the Capital Stock of any Person that does not own any assets constituting First-Priority Assets or Non-ABL Intercompany Note Assets will not be subject to paragraph (a) above, but rather will be subject to paragraph (b) above.
(d) On In the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after event of an Asset DispositionDisposition that requires the purchase of Securities (and, in the case of clause (a)(4)(B) above, Other First-Priority Obligations, and, in the case of clause (b)(3)(C) above, other Senior Indebtedness of the Company) pursuant to clause (a)(4)(B) or (b)(3)(C) above, the Company shall purchase the Securities tendered pursuant to an offer by the Company for the Securities (and such earlier time Other First-Priority Obligations or Senior Indebtedness of the Company, as the Issuer elects, if case may be) (the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders andat a purchase price of 100% of their principal amount (or, to in the extent the Issuer elects, to all event such Other First-Priority Obligations or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess ProceedsCompany was issued with significant original issue discount, at an offer price100% of the accreted value thereof), without premium, plus accrued and unpaid interest (or, in respect of the Notessuch Other First-Priority Obligations or Senior Indebtedness, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestsuch lesser price, if any, toas may be provided for by the terms of such Other First-Priority Obligations or Senior Indebtedness of the Company), but not includingin the case of the Securities, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures (including prorating in the event of oversubscription) set forth in this IndentureSection 4.06(e) (it being understood that the applicable Net Available Cash shall be applied ratably to the Securities and such Other First-Priority Obligations or Senior Indebtedness based on the respective amounts of the Securities and such Other First-Priority Obligations and Senior Indebtedness). If the aggregate purchase price of the Securities and, as applicable, Other First-Priority Obligations or Senior Indebtedness tendered exceeds the Net Available Cash allotted to their purchase, the Company will select the securities to be purchased on a prorata basis but in minimum round denominations, which in the case of the Securities will be denominations of $200,000 1,000 principal amount or multiples thereof. The Company shall not be required to make any such Offer pursuant to this Section 4.06 if the Net Available Cash available therefor is less than $5,000,000 (which lesser amount shall be carried forward for purposes of determining whether such an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition). Upon completion of such Offer, Net Available Cash will be deemed to be reduced by the aggregate amount of such Offer.
(1) Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall deliver to the Trustee and send, by first- class mail to each Holder, a written notice stating that the Holder may elect to have its Securities purchased by the Company either in whole or in part (subject to prorating as described in Section 4.06(d) in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the “Purchase Date”) and shall contain such information concerning the business of the Company which the Company in excess thereofgood faith believes will enable such Holders to make an informed decision (which at a minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), (B) a description of material developments in the Company’s business subsequent to the date of the latest of such Reports, and (C) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to the Offer, together with the information contained in Section 4.06(e)(3).
(e2) Upon completion Not later than the date upon which written notice of any such Asset Disposition Offeran Offer is delivered to the Trustee as provided below, the Company shall deliver to the Trustee an Officers’ Certificate as to (A) the amount of Excess Proceeds that resulted the Offer (the “Offer Amount”), including information as to any other Senior Indebtedness included in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining (B) the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being made and (C) the compliance of such allocation with the provisions of Section 4.06(a) and (b), as applicable. On such date, the Company shall not also 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, maturing on the last day prior to the Purchase Date or on the Purchase Date if funds are immediately available by open of business, an amount equal to the Offer Amount to be deemed Excess Proceeds and held for payment in accordance with the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by provisions of this IndentureSection. If the aggregate amount of Notes and such Offer includes other Senior Indebtedness validly tendered and not properly withdrawn Indebtedness, the deposit described in the preceding sentence may be made with any other paying agent pursuant to an Asset Disposition arrangements satisfactory to the Trustee. Upon the expiration of the period for which the Offer exceeds remains open (the “Offer Period”), the Company shall deliver to the Trustee for cancellation the Securities or portions thereof which have been properly tendered to and are to be accepted by the Company. The Trustee shall, on the Purchase Date, mail or deliver payment (or cause the delivery of payment) to each tendering Holder in the amount of Excess Proceedsthe purchase price. In the event that the aggregate purchase price of the Securities delivered by the Company to the Trustee is less than the Offer Amount applicable to the Securities, the Excess Proceeds Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(3) Holders electing to have a Security purchased shall be allocated among required to surrender the tendering Holders of Notes and such other Senior Indebtedness pro rata based on Security, with an appropriate form duly completed, to the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For Company at the purposes of calculating address specified in the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) notice at least three Business Days prior to the beginning Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a telex, facsimile transmission or letter setting forth the name of the Asset Disposition Offer Period. Upon completion of any Asset Disposition OfferHolder, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, the Security which was delivered for purchase by the Holder and a statement that such ▇▇▇▇▇▇ is withdrawing its election to have such Security purchased. Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (unpurchased portion of the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition OfferSecurities surrendered.
(h4) The Parent and its Restricted Subsidiaries may satisfy At the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior time the Company delivers Securities to the expiration of the relevant 360 days (or such longer period provided above) respect Trustee which are to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05be accepted for purchase, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).Company shall also de
Appears in 1 contract
Sources: Indenture (Novamerican Steel Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(ia) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition is not less than at least equal to the fair market value of the shares and assets disposed of subject to such Asset Disposition, as of such fair market value may be determined (and shall be determined, to the date of entry into binding documentation in respect of extent such Asset Disposition (as determined or any series of related Asset Dispositions involves aggregate consideration in excess of $25.0 million) in good faith by the Parent’s Board of Directors, whose determination shall be conclusive (including as to the value of all noncash consideration); and,
(iib) in the case of any Asset Disposition (or series of related Asset Dispositions) having a fair market value of $15.0 million or more, at least 75% of the consideration therefor (excluding, in the Parent case of an Asset Disposition (or series of related Asset Dispositions), any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise, that are not Indebtedness) received by the Company or such Restricted Subsidiary receives is in respect the form of cash, and
(c) an amount equal to 100% of the Net Proceeds from such Asset Disposition consists of:
described in clause (Ab) cash is applied by the Company (including or any Net Restricted Subsidiary, as the case may be) in accordance with the requirements of Section 2.09(b)(iii): For the purposes of clause (ii) of paragraph (b) above, the following are deemed to be cash: (1) Temporary Cash Proceeds received Investments and Cash Equivalents, (2) the assumption of Indebtedness, other than Indebtedness that is by its terms subordinated to the Obligations, of the Company (other than Disqualified Stock of the Company) or any Restricted Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on payment of the conversion within 180 days principal amount of such Asset Disposition of securities, notes or other obligations received Indebtedness in consideration of connection with such Asset Disposition);
, (B3) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’sIndebtedness, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness)Indebtedness that is by its terms subordinated to the Obligations, as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of the principal amount of such Indebtedness in connection with such Asset Disposition, (i4) has been extinguished securities received by the Issuer Company or any Restricted Subsidiary from the applicable Guarantortransferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days, (5) Additional Assets and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G6) any Designated Non-Cash cash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in an Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant that is at any one time outstandingclause, not to exceed an aggregate amount at any time outstanding equal to the greater of 15$50.0 million and 5.75% of Consolidated EBITDA and $150 million Tangible Assets (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition of any Notes Collateral unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives consideration at the time of such Asset Disposition at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Board of Directors, of the shares and assets subject to such Asset Disposition;
(2) except to the extent the Company or a Restricted Subsidiary receives Additional Assets in exchange for such Asset Disposition is (other than Additional Assets that would not less than be added to the fair market value Notes Collateral as a result of the assets disposed of as of the date of entry into binding documentation proviso contained in respect of such Asset Disposition (as determined by the Parent’s Board of DirectorsSection 4.06(a)(3)(i); and
(ii) ), at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary is in the form of cash or cash equivalents; provided, however, that the terms of this Section 4.06(a)(2) shall not apply to any Specified Asset Sale;
(i) to the extent that the Additional Assets received by the Company and its Restricted Subsidiaries in such Asset Disposition qualify as "Additional Assets" pursuant to clause (1) of the definition thereof, such Additional Assets are concurrently with their acquisition added to the Notes Collateral securing the Securities; provided, however, that Additional Assets that qualify as "Additional Assets" pursuant to clause (1)(B) of the definition thereof shall only be added to the Notes Collateral pursuant to this clause (i) to the extent the terms of the Intercreditor Agreement are amended, modified or terminated to permit the addition of such Additional Assets to the Notes Collateral; and (ii) to the extent that the Additional Assets received by the Company and its Restricted Subsidiaries in such Asset Disposition constitute the Capital Stock of any Person, assets of such Person that qualify as "Additional Assets" pursuant to clause (1) of the definition thereof (excluding Additional Assets that qualify as "Additional Assets" pursuant to clause (1)(B) of the definition thereof unless and until the terms of the Intercreditor Agreement are amended, modified or terminated to permit the addition of such Additional Assets to the Notes Collateral) with a Fair Market Value that is equal to or greater than the Fair Market Value of the Notes Collateral that is the subject of such Asset Disposition are concurrently with the acquisition added to the Notes Collateral securing the Securities; and
(4) an amount equal to 100% of the Net Available Cash from such Asset Disposition is paid directly by the purchaser thereof to the Notes Collateral Agent to be held in trust and applied by the Company (or such Restricted Subsidiary, as the case may be) at the Company's election either:
(A) to acquire Additional Assets (other than Additional Assets that would not be added to the Notes Collateral pursuant to clause (i) of the following proviso) (or to reimburse the Company for customary out-of-pocket costs incurred by the Company and directly related to such acquisition), which Additional Assets are concurrently with their acquisition added to the Notes Collateral securing the Securities; provided, however, that (i) to the extent that the Additional Assets acquired by the Company and its Restricted Subsidiaries in such Asset Disposition qualify as "Additional Assets" pursuant to clause (1) of the definition thereof, such Additional Assets are concurrently with their acquisition added to the Notes Collateral securing the Securities (provided that Additional Assets that qualify as "Additional Assets" pursuant to clause (1)(B) of the definition thereof shall only be added to the Notes Collateral pursuant to this clause (i) to the extent the terms of the Intercreditor Agreement are amended, modified or terminated to permit the addition of such Additional Assets to the Notes Collateral) and (ii) to the extent that the Additional Assets acquired by the Company and its Restricted Subsidiaries in such Asset Disposition constitute the Capital Stock of any Person, assets of such Person that qualify as "Additional Assets" pursuant to clause (1) of the definition thereof (excluding Additional Assets that qualify as "Additional Assets" pursuant to clause (1)(B) of the definition thereof unless and until the terms of the Intercreditor Agreement are amended, modified or terminated to permit the addition of such Additional Assets to the Notes Collateral) with a Fair Market Value that is equal to or greater than the Net Available Proceeds received by the Company or any of its Restricted Subsidiaries in respect of the Notes Collateral that is the subject of such Asset Disposition are concurrently with the acquisition added to the Notes Collateral securing the Securities, or
(B) to make an offer to the holders of the Securities (and if applicable holders of any Pari Passu Debt) to purchase Securities (and such Pari Passu Debt) pursuant to and subject to the conditions contained in the Indenture, in each case within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (B) above, the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 4.06(a), the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this Section 4.06(a), except to the extent that the aggregate Net Available Cash from all Asset Dispositions of Notes Collateral which is not applied in accordance with this Section 4.06(a) exceeds $7.5 million.
(b) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition (other than an Asset Disposition of Notes Collateral) unless:
(1) the Company or such Restricted Subsidiary receives in respect consideration at the time of such Asset Disposition consists of:
(A) cash at least equal to the fair market value (including any Net Cash Proceeds received from as to the conversion within 180 days value of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtednessall non-cash consideration), as a result determined in good faith by the Board of which none Directors, of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer shares and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of assets subject to such Asset Disposition;
(D2) Replacement Assets;except to the extent the Company or a Restricted Subsidiary receives Additional Assets in exchange for such Asset Disposition, at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents; provided, however, that the terms of this Section 4.06(b)(2) shall not apply to any Specified Asset Sale; and
(E3) any Capital Stock or assets an amount equal to 100% of the kind referred to in clause Net Available Cash from such Asset Disposition is applied by the Company (iv) or (vi) of Section 4.05(b);such Restricted Subsidiary, as the case may be):
(FA) consideration consisting first, to the extent the Company elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem or purchase Senior Indebtedness of the Issuer Company or Indebtedness (other than any Guarantor received from Persons who are not the Parent, the Issuer or any Disqualified Stock) of a Restricted Subsidiary (in each case other Restricted Subsidiary, but only than Indebtedness owed to the extent that such Indebtedness (i) has been extinguished by the Issuer Company or the applicable Guarantor, and (ii) is not Subordinated Indebtedness an Affiliate of the Issuer or such Guarantor;
(GCompany) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any within one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of year from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash;
(B) second, to the Parent or its Restricted Subsidiaries may use extent of the balance of such Net Available Cash to:after application in accordance with clause (A), to the extent the Company elects, to acquire Additional Assets within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash (or to reimburse the Company for customary out-of-pocket costs incurred by the Company and directly related to such acquisition); and
(iC) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (aA) prepayand (B), repay, purchase or redeem to make an offer to the holders of the Securities (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any and to holders of other Senior Indebtedness Incurred under of the Company designated by the Company) to purchase securities (and such other Senior Indebtedness of the Company) pursuant to and subject to the conditions contained in Section 4.01(b)(i4.06(d); (b) unless included provided, however, that in the preceding connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (i)(aA) or (C) above, the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 4.06(b), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, Company and its the Restricted Subsidiaries shall not be entitled required to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, apply any Net Available Cash in accordance with this Section 4.06(b) except to the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce extent that the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (cNet Available Cash from all Asset Dispositions subject to this Section 4.06(b) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that which is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (applied in accordance with the procedures set out below);
(iiithis paragraph Section 4.06(b) invest in any Replacement Assets;
(iv) acquire all or substantially all exceeds $7.5 million. Pending application of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to this Section 4.05(b)(i)4.06, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may be applied to temporarily reduce revolving credit borrowings indebtedness or otherwise utilize such Net Available Cash invested in any manner that is not prohibited by the terms of this Indenture.
(dc) On For the 361st day purposes of this Section 4.06, the following are deemed to be cash or cash equivalents:
(1) the assumption of Indebtedness of the Company (other than obligations in respect of Disqualified Stock of the Company) or any Restricted Subsidiary (other than obligations in respect of Disqualified Stock or Preferred Stock of a Subsidiary Guarantor) and the 541st day if a binding commitment as described release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in Section 4.05(b)(viii) is entered into) after an connection with such Asset Disposition, ; and
(2) securities received by the Company or any Restricted Subsidiary from the transferee that are promptly converted by the Company or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders andRestricted Subsidiary into cash, to the extent of cash received in that conversion.
(d) In the Issuer elects, to all or some holders event of other outstanding Senior Indebtedness an Asset Disposition that is Pari Passu Indebtedness, results in an offer to purchase Securities (and any other Indebtedness of the maximum Company) pursuant to Section (a)(4)(B) or (b)(3)(C) above, the Company shall purchase Securities tendered pursuant to an offer by the Company for the Securities (and such other Indebtedness) the ("Offer") at a purchase price of 100% of their principal amount of Notes and any (or, in the event such other Senior Indebtedness that may be purchased out of the Excess ProceedsCompany was issued with significant original issue discount, at an offer price100% of the accreted value thereof) without premium, plus accrued but unpaid interest (or, in respect of the Notes, equal to no less than 100% such other Indebtedness of the principal amount thereof plus accrued and unpaid interestCompany, such lesser price, if any, to, but not including, as may be provided for by the date terms of purchase. The Asset Disposition Offer in respect of Notes will be made such Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this IndentureSection 4.06(e). In each case, if the aggregate purchase price of the securities tendered pursuant to the Offer exceeds the Net Available Cash allotted to their purchase, the Company shall select the securities to be purchased on a pro rata basis but in minimum round denominations, which in the case of the Securities will be denominations of $200,000 and in integral 1,000 principal amount or multiples of $1,000 in excess thereof.
(e) Upon . If any Net Available Cash remains after the completion of any such Asset Disposition Offeroffer to purchase, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries Company may use such Net Available Cash for any purpose not otherwise prohibited by this the Indenture. If Upon completion of any such Offer, Net Available Cash will be deemed to be reduced by the aggregate amount of Notes such Offer.
(1) Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as described in Section 4.06(d) in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain or incorporate by reference such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), (B) a description of material developments in the Company's business subsequent to the date of the latest of such Reports, and (C) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to the Offer, together with the information contained in clause (3).
(2) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided below, the Company shall deliver to the Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer Amount"), including information as to any other Senior Indebtedness validly tendered and not properly withdrawn included in the Offer, (B) the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being made and (C) the compliance of such allocation with the provisions of Section 4.06(a), (b) and (d). On or prior to the last day prior to the Purchase Date, the Company shall also 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, maturing on the last day prior to the Purchase Date or on the Purchase Date if funds are immediately available by open of business, an Asset Disposition amount equal to the Offer exceeds Amount to be held for payment in accordance with the provisions of this Section; provided, however, that such amount shall be reduced by the amount of Excess Proceedsany Trust Moneys held at such time by the Trustee (net of any amounts payable to the Trustee pursuant to Section 7.07) that the Company instructs the Trustee to use for payment in accordance with this Section. If the Offer includes other Senior Indebtedness, the Excess Proceeds deposit described in the preceding sentence may be made with any other paying agent pursuant to arrangements satisfactory to the Trustee. Upon the expiration of the period for which the Offer remains open (the "Offer Period"), the Company shall deliver to the Trustee for cancellation the Securities or portions thereof which have been properly tendered to and are to be accepted by the Company. The Trustee shall, on the Purchase Date, mail or deliver payment (or cause the delivery of payment) to each tendering Holder in the amount of the purchase price. In the event that the aggregate purchase price of the Securities delivered by the Company to the Trustee is less than the Offer Amount applicable to the Securities, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(3) Holders electing to have a Security purchased shall be allocated among required to surrender the tendering Holders Security, with an appropriate form duly completed, to the Company at the address specified in the notice not later than the close of Notes and such other Senior Indebtedness pro rata based business on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) third Business Days prior to the beginning Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than the close of business on the third Business Day prior to the Purchase Date, a telex, facsimile transmission or letter setting forth the name of the Asset Disposition Offer Period. Upon completion of any Asset Disposition OfferHolder, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, the Security which was delivered for purchase by the Holder and a statement that such Holder is withdrawing his election to have such Security purchased. Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (unpurchased portion of the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition OfferSecurities surrendered.
(h4) The Parent and its Restricted Subsidiaries may satisfy At the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior time the Company delivers Securities to the expiration of the relevant 360 days (or such longer period provided above) respect Trustee which are to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05be accepted for purchase, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).Co
Appears in 1 contract
Sources: Indenture (Jacuzzi Brands Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Borrower will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i) the consideration the Parent, the Issuer Borrower or such other Restricted Subsidiary receives for consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition is not less than at least equal to the fair market value of the shares and assets disposed of subject to such Asset Disposition, as of such fair market value may be determined (and shall be determined, to the date of entry into binding documentation in respect of extent such Asset Disposition (as determined or any series of related Asset Dispositions involves aggregate consideration in excess of $10.0 million) in good faith by the Parent’s Board of Directors, whose determination shall be conclusive (including as to the value of all noncash consideration); and,
(ii) in the case of any Asset Disposition (or series of related Asset Dispositions) at least 75% of the consideration therefor (excluding, in the Parent case of an Asset Disposition (or series of related Asset Dispositions) of assets, any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise, that are not Indebtedness) received by the Borrower or such Restricted Subsidiary receives is in respect the form of (a) cash, or (b) Designated Noncash Assets having an aggregate fair market value, taken together with all other Designated Noncash Assets received in consideration for Asset Dispositions pursuant to this clause (b) that are at the time outstanding, not to exceed the greater of (x) 5% of Consolidated Tangible Assets and (y) $35.0 million at the time of receipt of such Designated Noncash Assets; and
(iii) an amount equal to 100% of the Net Available Cash from such Asset Disposition consists ofis applied by the Borrower (or any Restricted Subsidiary, as the case may be) as follows:
(A) cash first, either (including any Net Cash Proceeds received from x) to the conversion extent the Borrower elects to prepay, repay or purchase Indebtedness of the Borrower (other than Subordinated Obligations) ranking pari passu with the Loan or Indebtedness of a Restricted Subsidiary (in each case other than Indebtedness owed to the Borrower or a Restricted Subsidiary) within 180 365 days of such Asset Disposition of securities, notes or other obligations received in consideration after the date of such Asset Disposition), or (y) to the extent the Borrower or such Restricted Subsidiary elects, to reinvest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Borrower or another Restricted Subsidiary) within 365 days from the date of such Asset Disposition;
(B) second, to the extent of the balance of such Net Available Cash Equivalents;after application in accordance with clause (A) above (such balance, the "Excess Proceeds"), to make an offer to repay the Loan and (to the extent the Borrower or such Restricted Subsidiary elects, or is required by the terms thereof) to purchase, redeem or repay any other Indebtedness ranking pari passu in right of payment with the Loan ("Pari Passu Indebtedness"), pursuant and subject to the conditions of this Agreement and the agreements governing such other Indebtedness; and
(C) third, to the assumption by extent of the purchaser balance of such Net Available Cash after application in accordance with clauses (A) and (B) above, to fund (to the extent consistent with any other applicable provision of this Agreement) any general corporate purpose (including but not limited to the repurchase, repayment or other acquisition or retirement of any Subordinated Obligations); provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A)(x) or (B) above, the Borrower or such Restricted Subsidiary will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 6.8, the Borrower and the Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 6.8 except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 6.8 exceeds $15.0 million. If the aggregate principal amount of the Loan and Pari Passu Indebtedness validly tendered and not withdrawn (or otherwise subject to purchase, redemption or repayment) in connection with an offer pursuant to clause (B) above exceeds the Excess Proceeds, the Excess Proceeds will be apportioned between the Loan and such Pari Passu Indebtedness, with the portion of the Excess Proceeds payable in respect of the Loan to equal the lesser of (x) any liabilities recorded on the Parent’sExcess Proceeds amount multiplied by a fraction, the Issuer’s or such other Restricted Subsidiary’s balance sheet or numerator of which is the notes thereto (or, if Incurred since the date outstanding principal amount of the latest balance sheetLoan and the denominator of which is the sum of the outstanding principal amount of the Loan and the outstanding principal amount of the relevant Pari Passu Indebtedness, that would and (y) the aggregate principal amount of Loan validly tendered and not withdrawn. For the purposes of clause (ii) of the first paragraph of this Section 6.8, the following are deemed to be recorded on cash: (1) Temporary Cash Investments and Cash Equivalents, (2) the next balance sheet) assumption of Indebtedness of the Borrower (other than Subordinated Indebtedness), as a result of which none Disqualified Stock of the Parent, the Issuer Borrower) or any Restricted Subsidiary and the release of the other Borrower or such Restricted Subsidiaries remains obligated in respect Subsidiary from all liability on payment of the principal amount of such liabilitiesIndebtedness in connection with such Asset Disposition, or (y3) Indebtedness of a any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that the Borrower and each other Restricted Subsidiary are released from any Guarantee of payment of the principal amount of such Indebtedness in connection with such Asset Disposition, (i4) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration securities received by the Parent Borrower or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant from the transferee that is at any one time outstanding, not to exceed are converted by the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer Borrower or any other such Restricted Subsidiary consummates an Asset Disposition, into cash within 360 180 days (or such period as provided in clause (viii) below, if applicable) of after the later of the date of consummation of such Asset Disposition and receipt (5) consideration consisting of such Net Available Cash, outstanding Indebtedness of the Parent Borrower or its a Restricted Subsidiaries may use the Net Available Cash to:Subsidiary which is then retired.
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in In the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for event of an Asset Disposition Offer, in such an amount as would reduce that requires the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary repayment of the Parent that is not Loan pursuant to clause (iii)(B) of the first paragraph of this Section 6.8, the Borrower will be required to repay the Loan pursuant to an offer by the Borrower to repay the Loan (the "Offer") at a Guarantor (other than purchase price of 100% of the Issuer) or any Indebtedness that is secured Accreted Value thereof on assets that do not constitute Collateral (the date of repayment plus, in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (accrued and unpaid interest in accordance with the procedures (including prorating in the event of oversubscription) set out below);
forth in paragraph (iiic) invest in any Replacement Assets;
(iv) acquire all or substantially all of this Section 6.8. If the aggregate amount of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect Loan and other pari passu Indebtedness tendered pursuant to any such acquisition of Capital Stock, such Person the Offer is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other less than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash allotted to the repayment of the Loan and other Pari Passu Indebtedness tendered, the remaining Net Available Cash will be available to repay the Loan in accordance with clause (iii)(B) or (iii)(C) of the first paragraph of this Section 6.8. The Borrower shall not be required to make an Offer to repay the Loan pursuant to this Section 4.05(b)(i), 6.8 if the Net Available Cash available therefor (after application of the proceeds as provided in clause (iii)(A) of the first paragraph of this Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v6.8) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment is less than $15.0 million for any particular Asset Disposition (which lesser amounts shall be treated as a permitted application carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that dateany subsequent Asset Disposition).
(c) The amount of such Net Available Cash Borrower will, not so used as set forth above constitutes “Excess Proceeds.” Pending later than 45 days after the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof Borrower becomes obligated to make an offer Offer pursuant to this Section 6.8, mail a notice to the Lenders stating: (“1) that an Asset Disposition Offer”that requires the repayment of a portion of the Loan has occurred and that the Lenders have the right (subject to the prorating described below) to all Holders and, require the Borrower to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out repay a portion of the Excess Proceeds, Loan at an offer price, a purchase price in respect of the Notes, cash equal to no less than 100% of the principal amount thereof Accreted Value thereof, plus accrued and unpaid interest, if any, to, but not including, to the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with purchase (subject to Section 3.07); (2) the procedures set forth in this Indenture, in minimum denominations of $200,000 circumstances and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any relevant facts and financial information regarding such Asset Disposition OfferDisposition; (3) the repayment date (which shall be no earlier than 30 days nor later than 60 days from the date such notice is mailed); (4) the instructions determined by the Borrower, consistent with this Section 6.8, that the Lenders must follow in order to have the Loan repaid; and (5) the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(hd) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer Borrower will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase repayment of Notes the Loan pursuant to this IndentureSection 6.8. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.056.8, the Issuer Borrower will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 6.8 by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Loan Agreement (Sirva Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
of any Notes Collateral, unless (i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition at least equal to the Fair Market Value (including as determined by to the Parent’s Board value of Directors)all non-cash consideration) of the shares and assets subject to such Asset Disposition; and
(ii2) except in the case of any Permitted Asset Swap, at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary is in the form of cash or cash equivalents; (3) to the extent that any consideration received by the Company and its Restricted Subsidiaries in such Asset Disposition, including any Permitted Asset Swap, constitute securities or other assets that constitute Notes Collateral, such securities or other assets, including the assets of any Person that becomes a Restricted Subsidiary of the Company as a result of such transaction, are concurrently with their acquisition added to the Notes Collateral securing the Securities, other than Excluded Assets; and (4) the Net Available Cash from such Asset Disposition is paid directly by the purchaser thereof to the Noteholder Collateral Agent to be held in trust in an Asset Sale Proceeds Account for application in accordance with this Section 4.06. Notwithstanding the foregoing provisions of this Section 4.06(a), the Company and its Restricted Subsidiaries will not be required to cause any Net Available Cash to be held in an Asset Sale Proceeds Account in accordance with Section 4.06(a)(4) except to the extent the aggregate Net Available Cash from all Asset Dispositions of Notes Collateral which are not held in an Asset Sale Proceeds Account, or have not been previously applied in accordance with the provisions of the following paragraphs relating to the application of Net Available Cash from Asset Dispositions of Notes Collateral, exceeds $10 million.
(b) Within 365 days after the Note Collateral Agent’s receipt of the Net Available Cash from an Asset Disposition of any Notes Collateral, the Company or such Restricted Subsidiary shall at its option do any one or more of the following:
(1) acquire Additional Assets; provided, however, that such Additional Assets, including the assets of any Person that becomes a Restricted Subsidiary of the Company as a result of such acquisition, are concurrently with their acquisition added to the Notes Collateral securing the Securities; or
(2) make one or more offers to the Holders of the Securities (and, at the option of the Company, the holders of Other Pari Passu Lien Obligations) to purchase Securities (and such Other Pari Passu Lien Obligations) pursuant to and subject to the conditions contained in this Indenture (each, a “Notes Collateral Asset Sale Offer”); provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (2), the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 4.06(b), the Company and Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this Section 4.06(b) until the aggregate Net Available Cash from all Asset Dispositions of Notes Collateral which are not applied in accordance with this Section 4.06(b) exceeds $20 million.
(c) The Company shall commence a Notes Collateral Asset Sale Offer with respect to the Net Available Cash from any Asset Disposition of Notes Collateral not later than 10 Business Days after the later of (x) the 365th day after such Asset Disposition of Notes Collateral to the extent such Net Available Cash has not been used in accordance with Section 4.06(b) and (y) the date that the Net Available Cash from Asset Dispositions of Notes Collateral not applied in accordance with this covenant exceeds $20 million by mailing the notice required pursuant to the terms of this Indenture, with a copy to the Trustee. After the Company or any Restricted Subsidiary has applied the Net Available Cash from any Asset Disposition of any Notes Collateral as provided in, and within the time periods required by, Section 4.06(b) and (c), the balance of such Net Available Cash, if any, from such Asset Disposition of any Notes Collateral shall be released by the Noteholder Collateral Agent to the Company or such Restricted Subsidiary for use by the Company or such Restricted Subsidiary for any purpose not prohibited by the terms of this Indenture and shall cease to constitute Net Available Cash of Asset Dispositions of Notes Collateral subject to the provisions of this Section 4.06. Additionally, the Company may, at its option, make a Notes Collateral Asset Sale Offer using proceeds from any Asset Disposition of Notes Collateral at any time after consummation of such Asset Disposition.
(d) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly consummate an Asset Disposition (other than an Asset Disposition of Notes Collateral) unless:
(1) the Company or such Restricted Subsidiary) receives in respect consideration at the time of such Asset Disposition consists ofat least equal to the Fair Market Value (including as to the value of all non-cash consideration) of the shares and assets subject to such Asset Disposition; and
(2) except in the case of any Permitted Asset Swap, at least 75% of the consideration therefor received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents.
(e) Within 365 days after the Company’s or Restricted Subsidiary’s receipt of the Net Available Cash from an Asset Disposition specified in Section 4.06(d), the Company or such Restricted Subsidiary may at its option do any one or more of the following:
(A1) cash permanently reduce any Indebtedness under the Credit Agreement and/or any Indebtedness secured by a Permitted Lien (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(BCredit Facilities) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer not a Restricted Subsidiary as a result Guarantor (and, in the case of such Asset Dispositionrevolving obligations, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (ivcorrespondingly reduce commitments with respect thereto) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness, in each case other than Indebtedness owed to the Company or a Subsidiary of the Company; provided provided, however, that if the Parent, and its Restricted Subsidiaries Company or any Subsidiary Guarantor shall be entitled to prepay, repay, purchase or redeem such so reduce any Pari Passu Indebtedness, the Company shall equally and ratably reduce Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before under the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) Securities by making an offer to all Holders of Securities to purchase Notesat a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest and additional interest, if any, the pro rata principal amount of the Securities, such offer to be conducted in accordance with the provisions procedures set forth below for an Asset Disposition Offer, Sale Offer but without any further limitation in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoingamount; or
(viii2) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that dateacquire Additional Assets.
(cf) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent Company or any such Restricted Subsidiary of the Company may temporarily reduce Indebtedness under a revolving credit borrowings facility, if any, or otherwise utilize invest such Net Available Cash in Temporary Cash Investments. Any Net Available Cash from any manner Asset Disposition (other than an Asset Disposition of Notes Collateral) that is are not prohibited by applied as provided and within the terms of this Indenture.
(d) On the 361st 365-day (or the 541st day if a binding commitment as described time period set forth in Section 4.05(b)(viii4.06(e) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if will be deemed to constitute “Excess Proceeds”. When the aggregate amount of Excess Proceeds exceeds $60 20 million, the Issuer will be required within twenty (20) Business Days thereof to Company shall make an offer to all Holders of Securities (and, at the option of the Company, to holders of any Pari Passu Indebtedness) (an “Asset Disposition Sale Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes Securities (and any principal amount or accreted value, as applicable, of such other Senior Indebtedness Pari Passu Indebtedness), that is an integral multiple of $1,000 that may be purchased out of the Excess Proceeds, Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof thereof, plus accrued and unpaid interest and additional interest, if any (or, in respect of such Pari Passu Indebtedness, such lesser price, if any, toas may be provided for by the terms of such Pari Passu Indebtedness), but not including, to the date fixed for the closing of purchase. The Asset Disposition Offer in respect of Notes will be made such offer, in accordance with the procedures set forth in this Indenture. The Company shall commence an Asset Sale Offer with respect to Excess Proceeds not later than ten Business Days after the date that Excess Proceeds exceed $20 million by mailing the notice required pursuant to the terms of this Indenture, in minimum denominations with a copy to the Trustee. To the extent that the aggregate amount of $200,000 Securities (and in integral multiples of $1,000 in excess thereof.
(esuch Pari Passu Indebtedness) Upon completion of any such tendered pursuant to an Asset Disposition OfferSale Offer is less than the Excess Proceeds, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenturegeneral corporate purposes. If the aggregate principal amount of Notes Securities (and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer Pari Passu Indebtedness) surrendered by holders thereof exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee shall select the Securities (and the Company or the trustee with respect to such Pari Passu Indebtedness, shall select such Pari Passu Indebtedness) to be allocated among purchased in the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered manner described in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five clause (5g) Business Days prior to the beginning of the Asset Disposition Offer Periodbelow. Upon completion of any such Asset Disposition Sale Offer, the amount of Excess Proceeds which served as the basis for such Asset Sale Offer shall be reset at reduced to zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated. Additionally, the amount thereof payable in respect Company may, at its option, make an Asset Sale Offer using proceeds from any Asset Disposition at any time after consummation of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currencyAsset Disposition.
(g) The If more Securities (and any Other Pari Passu Lien Obligations) are tendered pursuant to a Notes Collateral Asset Disposition OfferSale Offer than the Company is required to purchase, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, the Securities to be purchased will be determined pro rata based on the principal amounts so tendered and the selection of the actual Securities for purchase shall be made by the Trustee on a pro rata basis to the extent it electspracticable; provided, Senior Indebtedness however, that no Securities (or any Other Pari Passu Lien Obligations) of $2,000 or less shall be purchased in part. If more Securities (and Pari Passu Indebtedness) are tendered pursuant to an Asset Sale Offer than the Company is required to purchase, the principal amount of the Securities to be repaid purchased shall be determined pro rata based on the principal amounts so tendered and the selection of the actual Securities for purchase shall be made by the Trustee on a pro rata basis to the extent practicable; provided, however, that no Securities (or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered Indebtedness) of $2,000 or less shall be purchased in response to the Asset Disposition Offerpart.
(h) The Parent For the purposes of Section 4.06, the following shall be deemed to be cash or cash equivalents:
(1) Temporary Cash Investments;
(2) the assumption or discharge of Indebtedness of the Company (other than obligations in respect of Disqualified Stock of the Company) or any Restricted Subsidiary (other than obligations in respect of Disqualified Stock or Preferred Stock of a Subsidiary Guarantor) and its the release of the Company or such Restricted Subsidiaries may satisfy Subsidiary from all liability on such Indebtedness other than, in each case, Indebtedness constituting Subordinated Obligations, in connection with such Asset Disposition; and
(3) securities received by the foregoing obligations with respect to Company or any Net Available Cash Restricted Subsidiary from an Asset Disposition the transferee that are promptly converted by making an Asset Disposition Offer with respect to the Company or such Net Available Cash prior Restricted Subsidiary into cash, to the expiration extent of cash received in that conversion within 90 days of the relevant 360 days (or receipt of such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenturesecurities.
(i) For the purposes of this Section 4.06, any sale by the Company or a Restricted Subsidiary of the Capital Stock of a Restricted Subsidiary that owns assets constituting Notes Collateral or ABL Collateral shall be deemed to be sale of such Notes Collateral or ABL Collateral (or, in the event of a Restricted Subsidiary that owns assets that include any combination of Notes Collateral and ABL Collateral a separate sale of each of such Notes Collateral and ABL Collateral). In the event of any such sale (or a sale of assets that includes any combination of Notes Collateral and ABL Collateral), the proceeds received by the Company and the Restricted Subsidiaries in respect of such sale shall be allocated to the Notes Collateral and ABL Collateral in accordance with their respective fair market values, which shall be determined by the Board of Directors of the Company in good faith or, in the case of an Asset Disposition involving an amount in excess of $25.0 million, an Independent Qualified Party. In addition, for purposes of this covenant, any sale by the Company or any Restricted Subsidiary of the Capital Stock of any Person that does not own any assets constituting Notes Collateral will not be subject to Sections 4.06(a) through (c), but rather will be subject to Section 4.06(d) through (f).
(j) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection 4.06. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.06, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 4.06 by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)securities laws or regulations.
Appears in 1 contract
Sources: Indenture (Affinia Group Intermediate Holdings Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Issuer shall not, and will shall not permit any of the Issuer or any other Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Disposition, unless:
(i1) the consideration the Parent, the Issuer or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by the Parent’s Board of DirectorsDisposition); and
(ii2) at least 75% of the consideration therefor received by the Parent Issuer or such Restricted Subsidiary receives in respect Subsidiary, as the case may be (which, for purposes of this clause (2), consideration will not include any contingent payment obligations related to such Asset Disposition consists Disposition, including, earn-out payments, purchase price adjustments and deferred purchase price payments), is in the form of cash or Cash Equivalents; provided that the amount of:
(A) cash any liabilities, as shown on the Issuer’s or such Restricted Subsidiary’s most recent balance sheet or in the notes thereto, of the Issuer or any of its Restricted Subsidiaries (including other than contingent liabilities and liabilities that are by their terms subordinated to the Notes) (i) that are assumed by the transferee of any Net Cash Proceeds received from such assets, or (ii) in respect of which neither the conversion within 180 days of Issuer nor any Restricted Subsidiary following such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition)has any obligation;
(B) Cash Equivalents;
(C) the assumption any securities or other obligations received by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any such Restricted Subsidiary from such transferee that are converted by the Issuer or such Restricted Subsidiary into cash or Cash Equivalents (to the extent of the other Restricted Subsidiaries remains obligated in respect of such liabilities, cash or (yCash Equivalents received) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if within 180 days following the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result closing of such Asset Disposition;
(D) Replacement Assets;
(EC) any Capital Stock Stock, properties or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b4.11(b)(2);
(FD) consideration consisting cash held in escrow as security for any purchase price settlement, for damages in respect of Indebtedness a breach of representations and warranties or covenants or for payment of other contingent obligations in connection with such Asset Disposition; and
(E) any Designated Noncash Consideration received by the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (E) that is at any one that time outstanding, not to exceed the greater of 15(x) $20.0 million and (y) 2.0% of Consolidated EBITDA and $150 million (the Total Assets of the Issuer at the time of the receipt of such Designated Noncash Consideration, with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination , in each case, shall be deemed to be Cash Equivalents for purposes of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)this provision and for no other purpose.
(b) If Within 365 days after the Parentreceipt of any Net Cash Proceeds of any Asset Disposition, the Issuer or any other such Restricted Subsidiary consummates an Asset DispositionSubsidiary, within 360 days (or such period as provided in clause (viii) belowat its option, if applicable) of may apply the later of the date of consummation of Net Cash Proceeds from such Asset Disposition and receipt to one or more of the following, or any combination,
(1) to reduce or repay:
(A) to permanently repay Secured Indebtedness or unsecured Senior Indebtedness of the Issuer or the Guarantors (or, in each case, make an offer to repurchase or redeem such Indebtedness; provided that such repurchase or redemption or offer for repurchase or redemption closes within 45 days after the end of such Net Available Cash365-day period); provided, that if such debt constitutes revolving Indebtedness, commitments for such revolving Indebtedness must be reduced by an amount equal to such repayment; or
(B) to the Parent extent the property that is subject to such Asset Disposition was sold by a non-Guarantor Subsidiary, Indebtedness of a non-Guarantor Subsidiary, other than Indebtedness owed to the Issuer or another Restricted Subsidiary; or
(2) to make (A) an Investment in any one or more businesses; provided that such Investment in any business is in the form of the acquisition of Capital Stock of a Restricted Subsidiary or results in the Issuer or its Restricted Subsidiaries may use owning an amount of the Net Available Cash to:
Capital Stock of such business such that it constitutes a Restricted Subsidiary, (iB) (a) prepaycapital expenditures in respect of the Issuer, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall or their respective assets or (C) acquisitions of other properties or assets to be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or held by the Issuer makes or its Restricted Subsidiaries (at including assets that replace the business, properties and assets of the Issuer or any of its Restricted Subsidiaries that were the subject of such time Asset Disposition), in the case of each of (A), (B) and (C), used or useful in compliance with this covenanta Related Business; or
(3) an offer to Holders to purchase Notes, reduce or repay Obligations under the Notes in accordance with the provisions provision set forth under Section 3.07, through open market purchases of the Notes or through an offer to purchase Notes (in accordance with the procedures set forth below for an Asset Disposition Offer); provided, in that all Net Cash Proceeds used to make such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers purchase shall be deemed to have been so applied whether or privately negotiated transactions at market prices) any series of Notes pursuant to not accepted by the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) Holders; provided that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Proceeds as set forth in Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v4.11(b)(2) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Issuer or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of the end of such 365-day period (xan “Acceptable Commitment”) and, in the date on which event any Acceptable Commitment is later cancelled or terminated for any reason before the Net Cash Proceeds are applied in connection therewith, then the Issuer or such investment is consummated, and (y) Restricted Subsidiary shall be permitted to apply the 180th day following Net Cash Proceeds in any manner set forth above before the expiration of the aforementioned 360such 180-day periodperiod and, if in the investment has not been consummated by that dateevent the Issuer or such Restricted Subsidiary fails to do so, then such Net Cash Proceeds shall constitute Excess Proceeds (as defined below).
(c) The amount of such Any Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to that are not invested or applied as provided and within the expiration of the relevant 360 days (or such longer time period provided aboveset forth in Section 4.11(b) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).to
Appears in 1 contract
Sources: Indenture
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will not, and Company will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i) the Company receives consideration the Parent(including by way of relief from, the Issuer or such by any other Restricted Subsidiary receives for such Asset Disposition is not less than person assuming responsibility for, any liabilities, contingent or otherwise) at least equal to the fair market value of the assets disposed of as of (such fair market value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (Disposition), as determined in good faith by the Parent’s Board Company, of Directors); andthe shares and assets subject to such Asset Disposition;
(ii) at least (i) 75% for sales of assets that do not constitute Charged Property or (ii) 100% for sales of assets that constitute Charged Property, of the consideration the Parent or such Restricted Subsidiary receives in respect of for such Asset Disposition consists received by the Company is in the form of cash or Cash Equivalents; and provided that, with respect to sales of assets that do not constitute Charged Property, the amount of
(A) the greater of the principal amount and the carrying value of any liabilities (as reflected on the Company’s most recent consolidated balance sheet or in the footnotes thereto or, if Incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been reflected on the Company’s consolidated balance sheet or in the footnotes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Company) of the Company, other than liabilities that are by their terms subordinated to the Facilities, that are (1) assumed by the transferee of any such assets (or a third party in connection with such transfer) pursuant to a written agreement which releases or indemnifies the Company from such liabilities or (2) otherwise cancelled or terminated in connection with the transaction; 212 Project Meria: Senior Facilties Agreement
(B) [Reserved]; and
(C) [Reserved], shall each be deemed to be Cash Equivalents for purposes of this provision and for no other purpose; and
(iii) an amount equal to one hundred (100) per cent. of the Net Available Cash from such Asset Disposition is applied:
(A) cash if the assets sold pursuant to such Asset Disposition constitute Charged Property, the Company shall be required to apply (including I) one hundred (100) per cent. of the Net Available Cash from such Asset Disposition to promptly repay the Facility B2 if, pro forma for such disposition, the Proportionate Net Leverage Ratio is greater than 3.00:1.00; (II) fifty (50) per cent. of the Net Available Cash from such Asset Disposition to repay the Facility B2 if, pro forma for such disposition, the Proportionate Net Leverage Ratio is equal to or less than 3.00:1.00 but greater than 2.50:1.00 and (III); zero (0) per cent. of the Net Available Cash from such Asset Disposition to repay the Facility B2 if, pro forma for such disposition, the Proportionate Net Leverage Ratio is equal to or less than 2.50:1.00. For the avoidance of doubt, any Net Cash Proceeds received from the conversion within 180 days proceeds of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);not required to be applied pursuant to this sub-paragraph (iii)(A) shall not constitute Excess Proceeds and may be used for any purposes not prohibited under this Agreement; and
(B) if the assets sold pursuant to such Asset Disposition do not constitute Charged Property, an amount equal to one hundred (100) per cent. of the Net Available Cash Equivalents;from such Asset Disposition is applied to prepay, repay or purchase any Debt other than Debt owed to the Company or Subordinated Debt and/or to invest in or commit to invest in Additional Assets,
(C1) the assumption by the purchaser in connection with any prepayment, repayment or purchase of Debt pursuant to sub-paragraph (xB) any liabilities recorded on the Parent’sabove, the Issuer’s or Company will retire such other Restricted Subsidiary’s balance sheet or Debt and will cause the notes thereto related commitment (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheetany) (other than Subordinated Indebtednessin the case of any asset-based credit facility) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased provided further that if the Company elects that any repayment of any revolving credit facility shall constitute an application of Net Available Cash under this paragraph (B) (the amount so elected to be applied being, the "RCF Election Amount"), as such repayment shall be accompanied by a result permanent cancellation of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated commitments under such revolving credit facility in respect of an amount at least equal to such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset DispositionRCF Election Amount;
(D2) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses case of sub-paragraph (ii)(AB) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided thatabove, a binding commitment or letter of intent entered into not later than such 365th day shall be treated as a permitted application of the Net Available Cash from the date of such commitment until or letter of intent so long as the earlier Company enters into such commitment or letter of (x) intent with the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by good faith expectation that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “will be applied to satisfy such commitment or letter of intent within the later of such 365th day and one hundred and eighty (180) days of such commitment or letter of intent (an "Acceptable Commitment") or, in the event any Acceptable Commitment is later cancelled or terminated for any reason before the Net Available Cash is applied in connection therewith, the Company enters into another Acceptable Commitment (a "Second Commitment") within one hundred and eighty (180) days of such cancellation or termination; provided further that if any Second Commitment is later cancelled or terminated for any reason before such Net Available Cash is applied, then such Net Available Cash shall constitute Excess Proceeds.” Pending ; and 213 Project Meria: Senior Facilties Agreement
(3) pending the final application of the amount of any such Net Available CashCash in accordance with sub-paragraph (B) above or otherwise in accordance with this Section 4, the Parent or any Restricted Subsidiary Company may temporarily reduce revolving credit borrowings Debt or otherwise utilize use such Net Available Cash in any manner not prohibited by this Agreement.
(b) The amount of Net Available Cash from Asset Dispositions that is not prohibited by the terms of this Indenture.
applied or invested or committed to be applied or invested as provided in paragraph (da) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer above will be required within twenty (20) Business Days thereof deemed to make an offer (“Asset Disposition Offer”) to all Holders andconstitute "Excess Proceeds" under this Agreement; provided that, to the extent the Issuer electsCompany has elected to prepay, repay or purchase any amount of Debt pursuant to sub-paragraph (a)(iii)(B) above (other than Obligations under this Agreement) at a price of no less than one hundred (100) per cent. of the principal amount thereof, and has extended such offer to the Lenders on at least a pro rata basis pursuant to Clause 8.5 (Application of prepayments), to all the extent the creditors in respect of such Debt (including the Lenders) elect not to tender their Debt for such prepayment, repayment or some purchase, the Company will be deemed to have applied an amount of Net Available Cash equal to such amount not tendered under this paragraph (b), and such amount shall not increase the amount of Excess Proceeds.
(c) In the case of sub-paragraph (a)(iii)(B) above, on the 366th day (or such longer period permitted by paragraph (a) above) after the later of an Asset Disposition or the receipt of such Net Available Cash, , the Company will within ten (10) Business Days make an offer (an "Asset Disposition Offer") to each Lender under the Facility, and if required or permitted by the terms of any Debt, to the holders of other such Debt, to prepay the outstanding Senior Indebtedness that Facility (and only to the extent the Facility is Pari Passu Indebtednessoutstanding) held by any such Lender at par, and to purchase the maximum aggregate principal amount (or accreted value, as applicable) of Notes and any such other Senior Indebtedness Debt that may be purchased out of the Excess Proceeds, Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestoffer price required by the terms thereof, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in the agreement(s) governing such Debt.
(d) The Company may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition in the case of sub-paragraph (a)(iii)(B) above, by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant three hundred and sixty-five (365) days (or such longer period provided above) with respect to all or part of the Net Available Cash (the "Advance Portion") in advance of being required to do so by this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereofAgreement (an "Advance Offer").
(e) Other than in the case of sub-paragraph (a)(iii)(A) above, Clause 8.5 (Application of prepayments) shall apply to any prepayment of the Facility.
(f) If the aggregate principal amount (or accreted value, if applicable) of the Facility or other Debt elected to be repaid pursuant to sub-paragraph (a)(iii)(A) above, as the case may be, surrendered by such holders thereof exceeds the amount offered in the Asset Disposition Offer (or in the case of an Advance Offer, the Advance Portion), the Company shall repay the Facility and such Debt, as the case may be, on a pro rata basis based on the aggregate principal amount (or accreted value, if applicable) of the Facility offered to be repaid or such Debt, as the case may be, tendered with adjustments as necessary so that no Facility to be repaid or Debt, as the case may be, will be repurchased in part in an unauthorized denomination. Upon completion of any such Asset Disposition Offer (or Advance Offer), the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (0) (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries Company may use such Net Available Cash for any purpose not prohibited permitted by this IndentureAgreement. If 214 Project Meria: Senior Facilties Agreement
(g) To the extent that the aggregate amount (or accreted value, if applicable) of Notes outstanding Facility prepaid and such other Senior Indebtedness validly Debt, as the case may be, tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds is less than the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered offered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to or, in the beginning case of the Asset Disposition Offer Period. Upon completion of any Asset Disposition an Advance Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”Advance Portion), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries Company may satisfy the foregoing obligations with respect to use any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days remaining Excess Proceeds (or such longer period provided above) respect to all or part in the case of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05an Advance Offer, the Issuer will comply with the applicable securities laws and regulations and will Advance Portion) for any purposes not be deemed to have breached its obligations otherwise prohibited under this Indenture by virtue of such complianceAgreement.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Restricted Subsidiary receives Person repaying or assuming responsibility for, any liabilities, contingent or otherwise) at least equal to the fair market value (such fair market value to be determined on the date of contractually agreeing to such Asset Disposition), as determined in good faith by the Company, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is not less than the fair market value of the assets disposed of as of the date of entry into binding documentation a Permitted Asset Swap);
(2) in respect of any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition (as determined by the Parent’s Board of Directors); and
(iiis a Permitted Asset Swap) at least 75% of the consideration the Parent or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person repaying or assuming responsibility for, any liabilities, contingent or otherwise) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value)Equivalents; orand
(H3) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 365 days (or such period as provided in clause (viii) below, if applicable) of from the later of (A) the date of consummation of such Asset Disposition and (B) the receipt of the Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment or a Second Commitment as set forth below, the “Proceeds Application Period”), an amount equal to 100% of such Net Available CashCash is applied, to the Parent extent the Company or its any Restricted Subsidiaries Subsidiary, as the case may use the Net Available Cash tobe, elects:
(i) (1) to the extent such Net Available Cash is from an Asset Disposition of Collateral, to make an offer (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer) to redeem Notes as described under Section 5.6 hereof, or purchase Notes through open-market purchases or in privately negotiated transactions, (2) to the extent such Net Available Cash is from an Asset Disposition of assets that do not constitute Collateral, (a) to reduce, prepay, repayrepay or purchase any Secured Indebtedness, purchase including Indebtedness under any Credit Facility (or redeem (including through open market purchasesany Refinancing Indebtedness in respect thereof) or any Permitted Funding Indebtedness; provided, voluntary tender offers that Net Available Cash may only be applied to the prepayment or privately negotiated transactions at market prices) any Senior repayment of Permitted Funding Indebtedness Incurred under Section 4.01(b)(i)if it was secured by a Lien on the asset or assets that were subject to such Asset Disposition; (b) unless included in the preceding clause (i)(a)to reduce, prepay, repay, repay or purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that (other than Indebtedness described in clause (a) above) the ParentCompany ratably repays the Notes by redeeming Notes as described under Section 5.6 hereof, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time purchasing Notes through open-market purchases or in compliance with this covenantprivately negotiated transactions, (c) to make an offer to Holders to purchase Notes, (in accordance with the provisions procedures set forth below for an Asset Disposition Offer, in such an amount ) to redeem Notes as would reduce the aggregate principal amount of described under Section 5.6 or purchase Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, through open-market purchases or redemptions; in privately negotiated transactions, or (cd) to reduce, prepay, repay, repay or purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Non-Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any Restricted SubsidiarySubsidiary or Permitted Funding Indebtedness); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (i)(2), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than obligations in respect of any asset-based credit facility to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased;
(iia) purchase to invest (including capital expenditures) in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary); or (b) to invest (including capital expenditures) in any series of Notes pursuant to an offer to all Holders one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such series Asset Disposition, with any such investment made by way of Notesa capital or other lease valued at the present value of the minimum amount of payments under such lease (as reasonably determined by the Company); provided, redeem that any assets acquired (including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricesany Equity Interests) any series of Notes pursuant to the redemption provisions of this Indenture or by making with Net Available Cash from an Asset Disposition Offer to all Holders of the Notes (in accordance Collateral are pledged as Collateral substantially simultaneously with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets ofsuch acquisition; provided, or any Capital Stock offurther, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment agreement shall be treated as a permitted application of the Net Available Cash from the date of such commitment until with the earlier good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (xan “Acceptable Commitment”) and, in the date on which event that any Acceptable Commitment is later cancelled or terminated for any reason before such investment amount is consummatedapplied in connection therewith, and the Company or such Restricted Subsidiary enters into another Acceptable Commitment (ya “Second Commitment”) the 180th day following the expiration within 180 days of the aforementioned 360-day periodsuch cancellation or termination; provided, further, that if the investment has not been consummated by that date.
(c) The any Second Commitment is later cancelled or terminated for any reason before such amount of is applied, then such Net Available Cash not so used as set forth above constitutes “shall constitute Collateral Excess Proceeds or Excess Proceeds.” Pending , as the case may be; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available CashCash pursuant to this Section 3.5 (other than from an Asset Disposition of Collateral, if such Net Available Cash is required to be held separately pursuant to the last sentence of this paragraph), the Parent Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness (including under any Restricted Subsidiary may temporarily reduce revolving credit borrowings Credit Facility) or otherwise utilize apply such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
, and (d2) On the 361st day Company (or any Restricted Subsidiary, as the 541st day if a binding commitment as described case may be) may elect to invest in Section 4.05(b)(viii) is entered into) after an Additional Assets prior to receiving the Net Available Cash attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of notice to the Trustee of the relevant Asset Disposition, or execution of a definitive agreement for the relevant Asset Disposition, and consummation of the relevant Asset Disposition) and deem the amount so invested to be applied pursuant to and in accordance with clause (ii) above with respect to such earlier time Asset Disposition. Any Net Available Cash from an Asset Disposition of Collateral in excess of $15.0 million shall be held separately and pledged as Collateral pending usage as set forth above. If, with respect to any Asset Disposition of Collateral, at the Issuer electsexpiration of the Proceeds Application Period with respect to such Asset Disposition, if there remains Net Available Cash in excess of the aggregate amount greater of $50.0 million (such amount, “Collateral Excess Proceeds exceeds $60 millionProceeds”), then subject to the limitations with respect to Foreign Dispositions set forth below, the Issuer will be required within twenty (20) Business Days thereof to Company shall make an offer (a “Collateral Asset Disposition Offer”) no later than ten business days after the expiration of the Proceeds Application Period to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu IndebtednessNotes, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Notes, that may be purchased out of the such Collateral Excess Proceeds, if any, at an offer price, in respect the case of the Notes, in cash in an amount equal to no less than 100% of the principal amount thereof thereof, plus accrued and unpaid interest, if any, to, but not including, the date fixed for the closing of purchase. The Asset Disposition Offer in respect of Notes will be made such offer, in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 2,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion . Notices of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an a Collateral Asset Disposition Offer shall be reset sent by first class mail or sent electronically, at least 10 days but not more than 60 days before the purchase date to zero (regardless each Holder of whether there are the Notes at such Holder’s registered address or otherwise in accordance with the applicable procedures of DTC. The Company may satisfy the foregoing obligation with respect to any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess from an Asset Disposition by making a Collateral Asset Disposition Offer prior to the expiration of the Proceeds and Application Period (the Parent and its Restricted Subsidiaries may use such “Collateral Advance Offer”) with respect to all or a part of the Net Available Cash (the “Collateral Advance Portion”) in advance of being required to do so by this Indenture. To the extent that the aggregate amount of Notes validly tendered or otherwise surrendered in connection with a Collateral Asset Disposition Offer is less than the amount offered in a Collateral Asset Disposition Offer (or, in the case of a Collateral Advance Offer, the Collateral Advance Portion), the Company may use any remaining Collateral Excess Proceeds (or, in the case of a Collateral Advance Offer, the Collateral Advance Portion) (the “Declined Collateral Excess Proceeds”) for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of the Notes validly tendered pursuant to any Collateral Asset Disposition Offer exceeds the amount of Collateral Excess Proceeds (or, in the case of a Collateral Advance Offer, the Collateral Advance Portion), the Company shall allocate the Collateral Excess Proceeds among the Notes to be purchased on a pro rata basis on the basis of the aggregate principal amount of tendered Notes; provided that no Notes will be selected and purchased in an unauthorized denomination. Upon completion of any Collateral Asset Disposition Offer, the amount of Collateral Excess Proceeds shall be reset at zero. If, with respect to any Asset Disposition of assets that do not constitute Collateral, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $50.0 million (such amount, “Excess Proceeds”), then subject to the limitations with respect to Foreign Dispositions set forth below, the Company shall make an offer (an “Asset Disposition Offer”) no later than ten business days after the expiration of the Proceeds Application Period to all Holders of Notes and, if required by the terms of any Pari Passu Indebtedness, to all holders of such Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and Pari Passu Indebtedness, as appropriate, on a pro rata basis, that may be purchased out of such Excess Proceeds, if any, at an offer price, in the case of the Notes, in cash in an amount equal to 100% of the principal amount thereof (or in the event such other Senior Indebtedness was issued with original issue discount, 100% of the accreted value thereof), plus accrued and unpaid interest, if any (or such lesser price with respect to Pari Passu Indebtedness, if any, as may be provided by the terms of such other Indebtedness), to, but not including, the date fixed for the closing of such offer, in accordance with the procedures set forth in this Indenture and the agreement governing the Pari Passu Indebtedness, as applicable, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices of an Asset Disposition Offer shall be sent by first class mail or sent electronically, at least 10 days but not more than 60 days before the purchase date to each Holder of the Notes at such Holder’s registered address or otherwise in accordance with the applicable procedures of DTC, with a copy to the Trustee. The Company may satisfy the foregoing obligation with respect to the Net Available Cash from an Asset Disposition by making an Asset Disposition Offer prior to the expiration of the Proceeds Application Period (the “Advance Offer”) with respect to all or a part of the Net Available Cash (the “Advance Portion”) in advance of being required to do so by this Indenture.
(b) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered and or otherwise surrendered in connection with an Asset Disposition Offer made with Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) is less than the amount offered in an Asset Disposition Offer, the Company may include any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) (the “Declined Excess Proceeds”) for any purpose not properly withdrawn otherwise prohibited by this Indenture. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Pari Passu Indebtedness validly tendered pursuant to an any Asset Disposition Offer exceeds the amount of Excess ProceedsProceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Pari Passu Indebtedness to be purchased on a pro rata based basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; provided that no Notes or other Senior Pari Passu Indebtedness so tendered will be selected and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered purchased in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Periodunauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(fc) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominatedDollars, the amount thereof payable in respect of such the Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated Dollars that is actually received by the Issuer Company upon converting such portion into Dollars.
(d) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash into such currency.
(g) The of any Asset Disposition Offeris received or deemed to be received by a Foreign Subsidiary (a “Foreign Disposition”) is (x) prohibited or delayed by applicable local law, insofar as it relates (y) restricted by applicable organizational documents or any agreement or (z) subject to other onerous organizational or administrative impediments, in each case, from being repatriated to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”)United States, the Issuer will purchase the principal amount portion of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior so affected will not be required to be applied in compliance with this Section 3.5, and such amounts may be retained by the applicable Foreign Subsidiary so long, but only so long, as the applicable local law, documents or agreements will not permit repatriation to the expiration United States (the Company hereby agreeing to use reasonable efforts (as determined in the Company’s reasonable business judgment) to otherwise cause the applicable Foreign Subsidiary to within one year following the date on which the respective payment would otherwise have been required, promptly take all actions reasonably required by the applicable local law, applicable organizational impediments or other impediment to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required, such repatriation of any of such affected Net Available Cash is permitted under the relevant 360 days applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and the amount of such repatriated Net Available Cash will be promptly (and in any event not later than five Business Days after such repatriation could be made) applied (net of additional Taxes payable or such longer period provided abovereserved against as a result thereof) respect (whether or not repatriation actually occurs) in compliance with this Section 3.5; and
(ii) to the extent that the Company has determined in good faith that repatriation of any of or all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to Foreign Disposition would have breached its obligations under this Indenture by virtue of such compliance.
an adverse Tax consequence (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, which for the avoidance of doubt, includes, but is not limited to, any prepayment out of such Net Available Cash whereby doing so the Company, any of its Subsidiaries, any Parent Entity or any of their respective affiliates and/or equity owners would incur a Tax liability, including as a result of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax), the Net Available Cash so affected may be considered effective if retained by the aggregate principal amount applicable Foreign Subsidiary. The non-application of any prepayment amounts as a consequence of the Notes of consenting Holders represents a majority of foregoing provisions will not, for the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).avoida
Appears in 1 contract
Sources: Indenture (loanDepot, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the Company (or a Restricted Subsidiary, as the case may be) receives consideration at the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than the fair market value time of the assets disposed of Asset Sale at least equal to the Fair Market Value (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by Sale) of the Parent’s Board of Directors)assets or equity interests issued or sold or otherwise disposed of; and
(ii2) at least 75% of the aggregate consideration received in the Parent Asset Sale by the Company or a Restricted Subsidiary and all other Asset Sales since the Issue Date is in the form of cash or Cash Equivalents. For purposes of this provision, each of the following will be deemed to be cash:
(a) any liabilities, as shown on the Company’s most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated in right of payment to the Notes or any Note Guarantee) that are assumed by the transferee or that are otherwise cancelled, forgiven or terminated in connection with the transaction with such transferee;
(b) with respect to any Asset Sale of oil and natural gas properties by the Company or any Restricted Subsidiary where the Company or such Restricted Subsidiary receives retains an interest in respect such property, costs and expenses related to the exploration, development, completion or production of such Asset Disposition consists of:properties and activities related thereto which the transferee (or an Affiliate thereof) agrees to pay;
(Ac) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any Restricted Subsidiary from such transferee that are, within 180 days of the Asset Sale, converted by the Company or such Restricted Subsidiary into cash, to the extent of the cash received in consideration of such Asset Disposition);that conversion; and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(Ed) any Capital Stock or assets of the kind referred to in clause (iv2) or (vi4) of Section 4.05(b);the next paragraph; and
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Ge) any Designated Non-Cash cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant that is at any one time outstandingclause (e), not to exceed the greater of 15an amount equal to 5.0% of the Company’s Adjusted Consolidated EBITDA and $150 million Net Tangible Assets (determined at the time of receipt of such Designated Non-cash Consideration), with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
. Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Company (Hor any Restricted Subsidiary) may apply an amount equal to such Net Proceeds at its option to any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash tofollowing:
(i1) (a) prepay, to repay, purchase repurchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of the Company or a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (Company, in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any Restricted Subsidiary)Guarantor;
(ii2) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets ofassets, or any Capital Stock ofStock, another Person of one or more other Persons primarily engaged in a Similar the Oil and Gas Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted SubsidiarySubsidiary of the Company;
(v3) to make a capital expenditure;expenditures in respect of the Company’s or any Restricted Subsidiaries’ Oil and Gas Business; or
(vi4) to acquire other assets (other than Capital Stock that are not classified as current assets under GAAP and cash or Cash Equivalents) that are used or useful in a Similar the Oil and Gas Business;
. The requirement of clause (vii2) consummate any combination or (4) of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment immediately preceding paragraph shall be treated as deemed to be satisfied if a permitted application bona fide binding contract committing to make the investment, acquisition or expenditure referred to therein is entered into by the Company or any of its Restricted Subsidiaries within the time period specified in the preceding paragraph and such Net Available Cash from Proceeds are subsequently applied in accordance with such contract within 180 days following the date of such commitment until the earlier of (x) the date on which such investment agreement is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” entered into. Pending the final application of any such Net Available CashProceeds, the Parent Company (or any Restricted Subsidiary Subsidiary) may temporarily reduce revolving credit borrowings or otherwise utilize such invest the Net Available Cash Proceeds in any manner that is not prohibited by this Indenture. The amount equal to the terms Net Proceeds from Asset Sales that are not applied or invested as provided in the second paragraph of this IndentureSection 3.5 will constitute “Excess Proceeds.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if ” When the aggregate amount of Excess Proceeds exceeds $60 25.0 million, within five days thereof, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (an “Asset Disposition Sale Offer”) to all Holders and, to of the extent the Issuer elects, to Notes and all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtednesspari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase, prepay or redeem with the proceeds of sales of assets to purchase purchase, prepay or redeem, on a pro rata basis, the maximum principal amount of Notes and any such other Senior pari passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased purchased, prepaid or redeemed out of the Excess Proceeds, at . The Company may satisfy the foregoing obligations with respect to any Net Proceeds from an offer price, in Asset Sale by making an Asset Sale Offer with respect to such Net Proceeds or equivalent amount prior to the time period that may be required by this Indenture with respect to all or a part of the Notes, available Net Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture (an “Advance Offer”). The offer price in any Asset Sale Offer will be equal to no less than 100% of the principal amount thereof amount, plus accrued and unpaid interest, if any, to, but not includingexcluding, the date of purchase. The Asset Disposition Offer in respect , prepayment or redemption, subject to the rights of Holders of the Notes on the relevant record date to receive interest due on the relevant interest payment date, and will be made payable in accordance with cash. If any Excess Proceeds (or in the procedures set forth in this Indenturecase of an Advance Offer, in minimum denominations Advance Portion) remain after consummation of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such an Asset Disposition Sale Offer, the amount of Company or any Restricted Subsidiary may use those Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash Advance Portion) for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and tendered in such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer exceeds the amount of Excess ProceedsProceeds (or in the case of an Advance Offer, the Excess Proceeds shall Advance Portion) allocated to the purchase of Notes, the Trustee will select the Notes to be allocated among the tendering Holders of Notes and such other Senior Indebtedness purchased on a pro rata basis (except that any Notes in global form will be selected by such method as DTC or its nominee or successor may require unless otherwise required by law), based on the aggregate principal amount of Notes and such other Senior Indebtedness so amounts tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consentadjustments as may be deemed appropriate by the Company so that only Notes in denominations of $2,000, for the avoidance or an integral multiple of doubt$1,000 in excess thereof, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).will be
Appears in 1 contract
Sources: Indenture (Earthstone Energy Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a1) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(ia) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (at least equal to the fair market value, as determined in good faith by the Parent’s Board of Directors); and, of the shares and assets subject to such Asset Disposition;
(iib) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash; provided that the following shall be deemed to be cash for purposes of this clause (A) cash b): (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(Ci) the assumption by the purchaser amount of (x) any liabilities recorded (as shown on the Parent’sCompany's, the Issuer’s or such other Restricted Subsidiary’s 's, most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Company or any Restricted Subsidiary (other than Subordinated Indebtedness)liabilities that are by their terms subordinated to the Securities or the Guarantees) that are assumed by the transferee of any such assets, as a result (ii) the amount of which none any securities received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of the Parent, cash received) within 90 days following the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result closing of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(Diii) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of any Telecommunications Assets received by the Company in such Asset Disposition and (iv) the fair market value of any Permitted Joint Venture Interests received by the Company or any Restricted Subsidiary in such Asset Disposition; provided that the aggregate fair market value of all Permitted Joint Venture Interests received pursuant to this clause (iv), valued, in each issue of Designated Non-Cash Consideration being measured case, at the time received of receipt, shall not exceed 10% of Consolidated Net Tangible Assets, (for purposes of this Section 4.06(1)(b), all determinations of fair market value shall be made in good faith by the Board of Directors and without giving effect evidenced by an Officers' Certificate delivered to subsequent changes in valuethe Trustee); orand
(Hc) any combination an amount equal to 100% of the types of consideration specified in Net Available Cash from such Asset Disposition is applied by the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days Company (or such period Restricted Subsidiary, as provided the case may be):
(i) first, to the extent the Company elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem, purchase or otherwise acquire Senior Indebtedness of the Company or Indebtedness (other than any Disqualified Stock) of a Wholly Owned Subsidiary (in clause (viiieach case, other than Indebtedness owed to the Company or an Affiliate of the Company and other than Preferred Stock) below, if applicable) within 180 days of the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) second, to the extent of the balance of Net Available Cash after application in accordance with clause (i) of this Section 4.06(1)(c), to the extent the Company or such Restricted Subsidiary elects to or enters into a binding agreement to, reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with cash in an amount equal to the amount of Net Available Cash received by, or to be received by, the Company or another Restricted Subsidiary) within 180 days of the later of such Asset Disposition or the receipt of such Net Available Cash; and
(iii) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (i) and (ii) of this Section 4.06(l)(c), to make an Offer to purchase Securities pursuant to and subject to the conditions set forth in paragraph (2) below; provided, however, that, if the Company elects (or is required by the terms of any series other Senior Subordinated Indebtedness), such Offer may be made ratably to purchase the Securities and other Senior Subordinated Indebtedness of Notes the Company; provided, however that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (i) or (iii) of this Section 4.06(1)(c), the Company or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased.
(1) except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 4.06(1) exceeds $10,000,000.
(2) In the event of an Asset Disposition that requires the purchase of Securities pursuant to clause (c)(iii) of Section 4.06(1), the Company shall be required to offer to purchase Securities tendered pursuant to an offer to all Holders by the Company for the Securities (an "Offer") at a purchase price of such series 100% of Notestheir principal amount plus accrued and unpaid interest thereon, redeem (including through open market purchasesand Additional Amounts in respect thereof, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant if any, to the redemption provisions date of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (purchase in accordance with the procedures (including prorating in the event of oversubscription) set out below);
forth in Section 4.06(3) and to purchase other Senior Subordinated Indebtedness on the terms and to the extent contemplated thereby. The Company will not be required to make an Offer for Securities (iiiand other Senior Subordinated Indebtedness) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect pursuant to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply this Section 4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (c)(i) and (c)(ii) of Section 4.06(1)) is less than $10,000,000 for any particular Asset Disposition (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(a) Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall be obligated to deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as hereinafter described in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (i) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form l0-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), (ii) a description of material developments in the Company's business subsequent to the date of the latest of such reports, and (iii) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to Section 4.05(b)(ithe Offer, together with the address referred to in clause (c).
(b) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided above, the Company shall deliver to the Trustee an Officers' Certificate as to (i) the amount of the Offer (the "Offer Amount"), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v(ii) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application the allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (iii) the compliance of such commitment until allocation with the earlier provisions of Section 4.06(1). On such date, the Company shall also irrevocably deposit with the Trustee or with a paying agent (xor, if the Company is acting as its own paying agent, segregate and hold in trust) an amount equal to the date on which such investment is consummated, Offer Amount to be invested in Temporary Cash Investments and (y) to be held for payment in accordance with the 180th day following provisions of this Section 4.06. Upon the expiration of the aforementioned 360-day periodperiod for which the Offer remains open (the "Offer Period"), the Company shall deliver to the Trustee for cancelation the Securities or portions thereof that have been properly tendered to and are to be accepted by the Company. The Trustee (or the Paying Agent, if not the investment has not been consummated Trustee) shall, on the date of purchase, mail or deliver payment to each tendering Holder in the amount of the purchase price. In the event that the Offer Amount delivered by that datethe Company to the Trustee is greater than the purchase price of the Securities (and other Senior Subordinated Indebtedness) tendered, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(c) The Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day 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 by the Holder for purchase and a statement that such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending Holder is withdrawing his election to have such Security purchased. If at the final application expiration of the Offer Period the aggregate principal amount of Securities and any such Net Available Cashother Senior Subordinated Indebtedness included in the Offer surrendered by holders thereof exceeds the Offer Amount, the Parent or any Restricted Subsidiary Company shall select the Securities and other Senior Subordinated Indebtedness to be purchased on a pro rata basis (with such adjustments as may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited be deemed appropriate by the terms Company so that only Securities and other Senior Subordinated Indebtedness in denominations of this Indenture$1,000, or integral multiples thereof, shall be purchased). Holders whose Securities are purchased only in part will be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.
(d) On At the 361st day (or time the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as Company delivers Securities to the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 millionTrustee which are to be accepted for purchase, the Issuer will Company shall also deliver an Officers' Certificate stating that such Securities are to be required within twenty (20) Business Days thereof accepted by the Company pursuant to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in terms of this IndentureSection 4.06. A Security shall be deemed to have been accepted for purchase at the time the Trustee, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereofdirectly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g4) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection 4.06. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.06, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); andthe shares and assets subject to such Asset Disposition,
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in the form of cash, assets useful in a Permitted Business or Permitted Securities, or the assumption by the purchaser of liabilities of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) as a result of which the Company and the Restricted Subsidiaries are no longer obligated with respect to those liabilities; provided that the amount of any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Disposition shall be deemed to be cash for the purposes of this provision (but for no other purpose) so long as such amount, taken together with the Fair Market Value when received of all other Designated Noncash Consideration that is at that time outstanding (i.e., that has not been sold for or otherwise converted into cash or Permitted Securities), does not exceed $50,000,000; provided, further, that (A) securities or other assets received by the Company or any Restricted Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days after the closing of such Asset Disposition shall be considered to be cash to the extent of the cash received in that conversion; and (B) any cash consideration paid to the Company or the Restricted Subsidiary in connection with the Asset Disposition that is held in escrow or on deposit to support indemnification, adjustment of purchase price or similar obligations in respect of such Asset Disposition consists ofshall be considered to be cash, and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) within 365 days (or, in the case of a Foreign Disposition as provided in Section 4.10(c), 730 days) after the later of the date of such Asset Disposition and the receipt of such Net Available Cash:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesto prepay, notes repay, purchase, repurchase, redeem, retire, defease or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date otherwise acquire for value Secured Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or a Subsidiary Guarantor (other than any Disqualified Stock or Subordinated Indebtedness), as a result of which none of the Parent, the Issuer Obligations) or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer not a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of in each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (case other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any an Affiliate of the Company;
(B) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes; provided, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(vin accordance with this clause (B) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted an application of the such Net Available Cash from the date of such commitment until if (i) such reinvestment is consummated within 180 days at the earlier end of such 365 day period (x) or, in the date on which such investment is consummatedcase of a Foreign Disposition as provided in Section 4.10(c), and (y) the 180th day following the expiration of the aforementioned 360730-day period) referred to in this clause (3) and (ii) if such reinvestment is not consummated within the period set forth in subclause (i) or such binding commitment is terminated, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such shall constitute available Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.; or
(dC) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”i) to all Holders and, to redeem the extent the Issuer elects, to all Notes or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, make open market purchases thereof at an offer price, in respect of the Notes, equal to no a price not less than 100% of the principal amount thereof or (ii) to make an Asset Disposition Offer to purchase Notes pursuant to and subject to the conditions set forth in Section 4.10(b); provided, however, that if the Company elects (or is required by the terms of any Pari Passu Indebtedness), such Asset Disposition Offer may be made ratably (determined based upon the respective principal amounts of the Notes and such Pari Passu Indebtedness being purchased or repaid) to purchase the Notes and to purchase or otherwise repay such Pari Passu Indebtedness; provided that pending final application of any such Net Available Cash in accordance with clause (3)(A), (B) or (C) above, the Company and the Restricted Subsidiaries may temporarily reduce revolving Indebtedness outstanding under the Credit Agreement or otherwise invest such Net Available Cash in any manner not prohibited by this Indenture. To the extent of the balance of such Net Available Cash after application in accordance with clauses (3)(A), (B) and (C) above, the Company or such Restricted Subsidiary, as the case may be, may use such balance for any general corporate purpose not prohibited by the terms of this Indenture. In connection with any prepayment, repayment, purchase, repurchase, redemption, retirement, defeasance or other acquisition for value of Indebtedness pursuant to clause 3(A) or (C) above, the Company or such Restricted Subsidiary, as the case may be, will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid, purchased, repurchased, redeemed, retired, defeased or otherwise acquired for value. Notwithstanding the foregoing provisions of this Section 4.10, the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this covenant exceeds $50,000,000.
(b) In the event of an Asset Disposition that requires the purchase of Notes pursuant to Section 4.10(a)(3)(C), the Company will be required
(i) to purchase Notes tendered pursuant to an offer by the Company for the Notes (the “Asset Disposition Offer”) at a purchase price of 100% of their principal amount plus accrued and unpaid interest, if any, to, but not including, interest thereon to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made Holders of record on the relevant date to receive interest due on the relevant Interest Payment Date) in accordance with the procedures procedures, including prorating in the event of oversubscription, set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.and
(eii) Upon completion to purchase or otherwise repay Pari Passu Indebtedness of the Company on the terms and to the extent contemplated thereby at the purchase price set forth in the relevant documentation (including accrued and unpaid interest to the date of acquisition, the “purchase price”), provided that to the extent the purchase price of any such Pari Passu Indebtedness exceeds 100% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of acquisition, the Company shall not use any Net Available Cash to pay such purchase price, except as permitted by the next sentence. If the aggregate purchase price of Notes and Pari Passu Indebtedness tendered pursuant to the Asset Disposition OfferOffer is less than the Net Available Cash allotted to the purchase of the Notes and Pari Passu Indebtedness, the amount Company will apply the remaining Net Available Cash for any general corporate purpose not prohibited by the terms of Excess Proceeds that resulted in the requirement this Indenture. The Company will not be required to make an Asset Disposition Offer shall for Notes and Pari Passu Indebtedness pursuant to this Section 4.10 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 4.10(a)(3)(A) and (B)) is less than $50,000,000 for any particular Asset Disposition (which lesser amount will be reset carried forward for purposes of determining whether an Asset Disposition Offer is required with respect to zero (regardless of whether there are the Net Available Cash from any remaining Excess Proceeds upon such completionsubsequent Asset Disposition). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount Net Available Cash in respect of Excess Proceeds any Asset Disposition(s) shall be reset at reduced to zero.
(fc) To Notwithstanding any other provisions of this Section 4.10, to the extent that an amount equal to any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion or all of the Net Available Cash into of any Asset Disposition by a Foreign Subsidiary (a “Foreign Disposition”) is (x) prohibited or delayed by applicable local law, (y) restricted by applicable organizational documents or any agreement or (z) subject to other onerous organizational or administrative impediments from being repatriated to the United States, solely with respect to an amount equal to the portion of such currencyNet Available Cash so affected, the 365-day period set forth in clause (a)(3) above shall be extended to 730 days.
(gi) The Promptly, and in any event within 10 days after the Company becomes obligated to make an Asset Disposition Offer, insofar as it relates the Company shall be obligated to deliver to the Trustee and send or, at the request of the Company have the Trustee send (such notice to be provided to the Trustee at least five Business Days before the Trustee is requested to send such notice. unless a shorter period shall be satisfactory to the Trustee), in the name and on behalf of the Company, by first-class mail to each Holder, or in the case of Global Notes, will remain open for send in accordance with the Applicable Procedures of the Depositary, a period written notice stating that the Holder may elect to have its Notes purchased by the Company either in whole or in part (subject to prorating as hereinafter described in the event the Asset Disposition Offer is oversubscribed) in minimum denominations of $2,000 of principal amount or any greater integral multiple of $1,000 thereof, at the applicable purchase price. The notice shall specify a purchase date not less than five 30 days nor more than 60 days after the date of such notice (5the “Purchase Date”) and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports); provided that in lieu of providing the reports specified in this subclause (1), the Company may, at its option, notify the holders that such reports are available to them in electronic format through the SEC’s ▇▇▇▇▇ system, (2) a description of material developments in the Company’s business subsequent to the date of the latest of such reports, and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Notes pursuant to the Asset Disposition Offer, together with the address referred to in clause (iii).
(ii) Not later than the date upon which written notice of an Asset Disposition Offer is delivered to the Trustee as provided above, the Company shall deliver to the Trustee an Officers’ Certificate as to (1) the amount of the Asset Disposition Offer (the “Asset Disposition Offer Amount”), (2) the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Asset Disposition Offer is being made and (3) the compliance of such allocation with the provisions of Section 4.10 (a) and (b). On the Business Days following Day immediately preceding the Purchase Date, the Company shall irrevocably deposit with the Trustee or with a paying agent (or, if the Company is acting as its commencement own paying agent, segregate and hold in trust) an amount equal to the Asset Disposition Offer Amount to be invested, at the Company’s written directions, in Cash Equivalents and to be held for payment in accordance with the provisions of this Section. Upon the expiration of the period for which the Asset Disposition Offer remains open (the “Asset Disposition Offer Period”), the Company shall deliver to the Trustee for cancellation the Notes or portions thereof that have been properly tendered to and are to be accepted by the Company. No later The Trustee (or the Paying Agent, if not the Trustee) shall, on the Purchase Date, mail or deliver payment to each tendering Holder in the amount of the purchase price for such Holder’s tendered Notes. In the event that the Asset Disposition Offer Amount delivered by the Company to the Trustee is greater than five (5) Business Days the purchase price of the Notes tendered, the Trustee shall deliver the excess to the Company promptly after the termination expiration of the Asset Disposition Offer Period for application in accordance with this Section 4.10.
(iii) Holders electing to have a Note purchased shall be required to surrender the “Asset Disposition Note, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date”). Holders shall be entitled to withdraw their election if the Company receives not later than one Business Day prior to the Purchase Date, a facsimile transmission or letter setting forth the Issuer will purchase name of the Holder, the principal amount of Notes and, the Note which was delivered by the Holder for purchase and a statement that such Holder is withdrawing its election to have such Note purchased. If at the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than expiration of the Asset Disposition Offer Amount has been so validly tendered, all Period the aggregate principal amount of Notes and Senior Indebtedness that is surrendered by holders thereof plus the purchase price of other Pari Passu Indebtedness validly tendered of the Company or the Subsidiary Guarantors being purchased or otherwise repaid exceeds the amount of Net Available Cash, the Company shall select the Notes and other Pari Passu Indebtedness to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes and other Pari Passu Indebtedness in response minimum denominations of $2,000, or integral multiples of $1,000 in excess thereof, shall be purchased). Holders whose Notes are purchased only in part will be issued new Notes equal in principal amount to the Asset Disposition Offerunpurchased portion of the Notes surrendered.
(hiv) The Parent and its Restricted Subsidiaries may satisfy At the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior time the Company delivers Notes to the expiration Trustee that are to be accepted for purchase, the Company shall also deliver an Officers’ Certificate stating that such Notes are to be accepted by the Company pursuant to and in accordance with the terms of this Section. A Note shall be deemed to have been accepted for purchase at the relevant 360 days (time the Trustee, directly or such longer period provided above) respect through an agent, mails or delivers payment therefor to all or part of the Net Available Cash in advance of being required to do so by this Indenturesurrendering Holder.
(iv) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.10. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.10, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 4.10 by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Aecom)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the Company (or a Restricted Subsidiary, as the case may be) receives consideration at the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than the fair market value time of the assets disposed of Asset Sale at least equal to the Fair Market Value (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by Sale) of the Parent’s Board of Directors)assets or equity interests issued or sold or otherwise disposed of; and
(ii2) at least 75% of the aggregate consideration received in the Parent Asset Sale by the Company or a Restricted Subsidiary and all other Asset Sales since the Issue Date is in the form of cash or Cash Equivalents. For purposes of this provision, each of the following will be deemed to be cash:
(a) any liabilities, as shown on the Company’s most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated in right of payment to the Notes or any Note Guarantee) that are assumed by the transferee or that are otherwise cancelled, forgiven or terminated in connection with the transaction with such transferee;
(b) with respect to any Asset Sale of oil and natural gas properties by the Company or any Restricted Subsidiary where the Company or such Restricted Subsidiary receives retains an interest in respect such property, costs and expenses related to the exploration, development, completion or production of such Asset Disposition consists of:properties and activities related thereto which the transferee (or an Affiliate thereof) agrees to pay;
(Ac) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any Restricted Subsidiary from such transferee that are, within 180 days of the Asset Sale, converted by the Company or such Restricted Subsidiary into cash, to the extent of the cash received in consideration of such Asset Disposition);that conversion; and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(Ed) any Capital Stock or assets of the kind referred to in clause (iv2) or (vi4) of Section 4.05(b);the next paragraph; and
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Ge) any Designated Non-Cash cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant that is at any one time outstandingclause (e), not to exceed the greater of 15an amount equal to 5.0% of the Company’s Adjusted Consolidated EBITDA and $150 million Net Tangible Assets (determined at the time of receipt of such Designated Non-cash Consideration), with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
. Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Company (Hor any Restricted Subsidiary) may apply an amount equal to such Net Proceeds at its option to any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash tofollowing:
(i1) (a) prepay, to repay, purchase repurchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of the Company or a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (Company, in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any Restricted Subsidiary)Guarantor;
(ii2) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets ofassets, or any Capital Stock ofStock, another Person of one or more other Persons primarily engaged in a Similar the Oil and Gas Business, if, after giving | effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted SubsidiarySubsidiary of the Company;
(v3) to make a capital expenditure;expenditures in respect of the Company’s or any Restricted Subsidiaries’ Oil and Gas Business; or
(vi4) to acquire other assets (other than Capital Stock that are not classified as current assets under GAAP and cash or Cash Equivalents) that are used or useful in a Similar the Oil and Gas Business;
. The requirement of clause (vii2) consummate any combination or (4) of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment immediately preceding paragraph shall be treated as deemed to be satisfied if a permitted application bona fide binding contract committing to make the investment, acquisition or expenditure referred to therein is entered into by the Company or any of its Restricted Subsidiaries within the time period specified in the preceding paragraph and such Net Available Cash from Proceeds are subsequently applied in accordance with such contract within 180 days following the date of such commitment until the earlier of (x) the date on which such investment agreement is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” entered into. Pending the final application of any such Net Available CashProceeds, the Parent Company (or any Restricted Subsidiary Subsidiary) may temporarily reduce revolving credit borrowings or otherwise utilize such invest the Net Available Cash Proceeds in any manner that is not prohibited by this Indenture. The amount equal to the terms Net Proceeds from Asset Sales that are not applied or invested as provided in the second paragraph of this IndentureSection 3.5 will constitute “Excess Proceeds.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if ” When the aggregate amount of Excess Proceeds exceeds $60 25.0 million, within five days thereof, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (an “Asset Disposition Sale Offer”) to all Holders and, to of the extent the Issuer elects, to Notes and all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtednesspari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase, prepay or redeem with the proceeds of sales of assets to purchase purchase, prepay or redeem, on a pro rata basis, the maximum principal amount of Notes and any such other Senior pari passu Indebtedness (plus all accrued interest on the Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith) that may be purchased purchased, prepaid or redeemed out of the Excess Proceeds, at . The Company may satisfy the foregoing obligations with respect to any Net Proceeds from an offer price, in Asset Sale by making an Asset Sale Offer with respect to such Net Proceeds or equivalent amount prior to the time period that may be required by this Indenture with respect to all or a part of the Notes, available Net Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture (an “Advance Offer”). The offer price in any Asset Sale Offer will be equal to no less than 100% of the principal amount thereof amount, plus accrued and unpaid interest, if any, to, but not includingexcluding, the date of purchase. The Asset Disposition Offer in respect , prepayment or redemption, subject to the rights of Holders of the Notes on the relevant record date to receive interest due on the relevant interest payment date, and will be made payable in accordance with cash. If any Excess Proceeds (or in the procedures set forth in this Indenturecase of an Advance Offer, in minimum denominations Advance Portion) remain after consummation of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such an Asset Disposition Sale Offer, the amount of Company or any Restricted Subsidiary may use those Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash Advance Portion) for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and tendered in such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer exceeds the amount of Excess ProceedsProceeds (or in the case of an Advance Offer, the Excess Proceeds shall Advance Portion) allocated to the purchase of Notes, the Company will select the Notes to be allocated among the tendering Holders of Notes and such other Senior Indebtedness purchased on a pro rata basis (except that any Notes in global form will be selected by such method as DTC or its nominee or successor may require unless otherwise required by law), based on the aggregate principal amount of Notes and amounts tendered (with such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall adjustments as may be converted into its U.S. Dollar Equivalent as of a date selected deemed appropriate by the Issuer Company so that is within the Asset Disposition Offer Period only Notes in denominations of $2,000, or no more than five (5) Business Days prior to the beginning an integral multiple of the Asset Disposition Offer Period$1,000 in excess thereof, will be purchased). Upon completion of any each Asset Disposition Sale Offer (or Advance Offer), the amount of Excess Proceeds shall (or Advance Portion) will be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) . The Asset Disposition Offer, insofar as it relates to the Notes, Company will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other securities laws or and regulations thereunder to the extent those laws and regulations are applicable in connection with the each repurchase of Notes pursuant to this Indenturean Asset Sale Offer or Advance Offer. To the extent that the provisions of any securities laws or regulations conflict | with provisions of this Section 4.053.5, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 3.5 by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Earthstone Energy Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); andthe shares and assets subject to such Asset Disposition,
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in the form of cash, assets useful in a Permitted Business, or the assumption by the purchaser of liabilities of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) as a result of which the Company and the Restricted Subsidiaries are no longer obligated with respect to those liabilities; provided that the amount of any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Disposition shall be deemed to be cash for the purposes of this provision (but for no other purpose) so long as such amount, taken together with the Fair Market Value when received of all other Designated Noncash Consideration that is at that time outstanding (i.e., that has not been sold for or otherwise converted into cash or Permitted Securities), does not exceed the greater of (i) $150,000,000 and (ii) 6% of Consolidated Tangible Assets as of the last day of the most recent fiscal quarter; provided, further, that (A) securities or other assets received by the Company or any Restricted Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days after the closing of such Asset Disposition shall be considered to be cash to the extent of the cash received in that conversion; and (B) any cash consideration paid to the Company or the Restricted Subsidiary in connection with the Asset Disposition that is held in escrow or on deposit to support indemnification, adjustment of purchase price or similar obligations in respect of such Asset Disposition consists ofshall be considered to be cash, and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) within 365 days after the later of the date of such Asset Disposition and the receipt of such Net Available Cash:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesto prepay, notes repay, purchase, repurchase, redeem, retire, defease or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date otherwise acquire for value Secured Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or a Subsidiary Guarantor (other than any Disqualified Stock or Subordinated Indebtedness), as a result of which none of the Parent, the Issuer Obligations) or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer not a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of in each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (case other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any an Affiliate of the Company;
(B) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes; provided, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(vin accordance with this clause (B) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted an application of the such Net Available Cash from the date of such commitment until if (i) such reinvestment is consummated within 180 days at the earlier end of such 365 day period referred to in this clause (x3) the date on which such investment is consummated, and (yii) if such reinvestment is not consummated within the 180th day following period set forth in subclause (i) or such binding commitment is terminated, the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such shall constitute available Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.; or
(dC) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”i) to all Holders and, to redeem the extent the Issuer elects, to all Notes or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, make open market purchases thereof at an offer price, in respect of the Notes, equal to no a price not less than 100% of the principal amount thereof or (ii) to make an Asset Disposition Offer to purchase Notes pursuant to and subject to the conditions set forth in Section 4.10(b); provided, however, that if the Company elects (or is required by the terms of any Pari Passu Indebtedness), such Asset Disposition Offer may be made ratably (determined based upon the respective principal amounts of the Notes and such Pari Passu Indebtedness being purchased or repaid) to purchase the Notes and to purchase or otherwise repay such Pari Passu Indebtedness; provided that pending final application of any such Net Available Cash in accordance with clause (3)(A), (B) or (C) above, the Company and the Restricted Subsidiaries may temporarily reduce revolving Indebtedness outstanding under the Existing Credit Agreement or otherwise invest such Net Available Cash in any manner not prohibited by this Indenture. To the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) above, the Company or such Restricted Subsidiary, as the case may be, may use such balance for any general corporate purpose not prohibited by the terms of this Indenture. In connection with any prepayment, repayment, purchase, repurchase, redemption, retirement, defeasance or other acquisition for value of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary, as the case may be, will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid, purchased, repurchased, redeemed, retired, defeased or otherwise acquired for value. Notwithstanding the foregoing provisions of this Section 4.10, the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this covenant exceeds $100,000,000.
(b) In the event of an Asset Disposition that requires the purchase of Notes pursuant to Section 4.10(a)(3)(C), the Company will be required
(i) to purchase Notes tendered pursuant to an offer by the Company for the Notes (the “Asset Disposition Offer”) at a purchase price of 100% of their principal amount plus accrued and unpaid interest, if any, to, but not including, interest thereon to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made Holders of record on the relevant date to receive interest due on the relevant Interest Payment Date) in accordance with the procedures procedures, including prorating in the event of oversubscription, set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.and
(eii) Upon completion to purchase or otherwise repay Pari Passu Indebtedness of the Company on the terms and to the extent contemplated thereby at the purchase price set forth in the relevant documentation (including accrued and unpaid interest to the date of acquisition, the “purchase price”), provided that to the extent the purchase price of any such Pari Passu Indebtedness exceeds 100% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of acquisition, the Company shall not use any Net Available Cash to pay such purchase price, except as permitted by the next sentence. If the aggregate purchase price of Notes and Pari Passu Indebtedness tendered pursuant to the Asset Disposition OfferOffer is less than the Net Available Cash allotted to the purchase of the Notes and Pari Passu Indebtedness, the amount Company will apply the remaining Net Available Cash for any general corporate purpose not prohibited by the terms of Excess Proceeds that resulted in the requirement this Indenture. The Company will not be required to make an Asset Disposition Offer shall for Notes and Pari Passu Indebtedness pursuant to this Section 4.10 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 4.10(a)(3)(A) and (B)) is less than $100,000,000 for any particular Asset Disposition (which lesser amount will be reset carried forward for purposes of determining whether an Asset Disposition Offer is required with respect to zero (regardless of whether there are the Net Available Cash from any remaining Excess Proceeds upon such completionsubsequent Asset Disposition). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount Net Available Cash in respect of Excess Proceeds any Asset Disposition(s) shall be reset at reduced to zero.
(fc) To (i) Promptly, and in any event within 20 days after the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Company becomes obligated to make an Asset Disposition Offer, insofar as it relates the Company shall be obligated to deliver to the Trustee and send or, at the request of the Company have the Trustee send (such notice to be provided to the Trustee at least five Business Days before the Trustee is requested to send such notice unless a shorter period shall be satisfactory to the Trustee), in the name and on behalf of the Company, by first-class mail to each Holder, or in the case of Global Notes, will remain open for send in accordance with the Applicable Procedures of the Depositary, a period of not less than five written notice stating that the Holder may elect to have its Notes purchased by the Company either in whole or in part (5) Business Days following its commencement (subject to prorating as hereinafter described in the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of event the Asset Disposition Offer Period is oversubscribed) in minimum denominations of $2,000 of principal amount or any greater integral multiple of $1,000 thereof, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the “Asset Disposition Purchase Date”) and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports); provided that in lieu of providing the reports specified in this subclause (1), the Issuer will purchase Company may, at its option, notify the principal amount holders that such reports are available to them in electronic format through the SEC’s ▇▇▇▇▇ system, (2) a description of Notes and, material developments in the Company’s business subsequent to the extent it electsdate of the latest of such reports, Senior Indebtedness required and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to be repaid or purchased by it tender Notes pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, together with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations address referred to in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
clause (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notesiii).
Appears in 1 contract
Sources: Indenture (Qorvo, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Issuer will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition unlessSale:
(i1) the Issuer (or the Restricted Subsidiary, as the case may be) receives consideration at the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than the fair market value time of the assets disposed of Asset Sale at least equal to the Fair Market Value (determined as of the date of entry into binding documentation in respect of contractual agreement to such Asset Disposition Sale) of the assets or Equity Interests issued or sold or otherwise disposed of;
(2) in the case of an Asset Sale of Collateral, the consideration from such Asset Sale is pledged as determined Collateral to secure the Notes (to the extent required by the Parent’s Board of DirectorsNotes Collateral Documents), at least until such time it is otherwise applied in accordance with this Section 3.5; and
(ii3) at least 75% of the consideration received in the Parent Asset Sale by the Issuer or any of its Restricted Subsidiaries is in the form of cash, Cash Equivalents or Replacement Assets. For purposes of this provision, each of the following will be deemed to be cash:
(i) any Indebtedness or liabilities, as shown on the Issuer’s most recent consolidated balance sheet or in the footnotes thereto (or, if incurred or accrued subsequent to the date of such balance sheet, such liabilities that would have been reflected on the Issuer’s most recent consolidated balance sheet or in the footnotes thereto if such incurrence or accrual had taken place on or prior to the date of such balance sheet, as determined in good faith by the Issuer), of the Issuer or any of its Restricted Subsidiaries (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Note Guarantee) that are assumed by the transferee of any such assets and for which the Issuer or such Restricted Subsidiary receives has been released in respect of such Asset Disposition consists of:writing;
(Aii) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any such Restricted Subsidiary from such transferee that are converted by the Issuer or such Restricted Subsidiary into cash or Cash Equivalents within 180 days of the other Restricted Subsidiaries remains obligated receipt thereof, to the extent of the cash or Cash Equivalents received in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Dispositionconversion;
(D) Replacement Assets;
(Eiii) any Capital Stock stock or assets of the kind referred to in clause clauses (iv2) or (vi4) of the succeeding paragraph of this Section 4.05(b);3.5; and
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Giv) any Designated Non-Cash cash Consideration received by the Parent Issuer or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market value, Fair Market Value (with the Fair Market Value of each item of Designated Non-cash Consideration being determined as of the date of contractual agreement to such Asset Sale) taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (d) that is at any one that time outstanding, outstanding not to exceed the greater of 15$10.0 million and 15.0% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in Issuer and its Restricted Subsidiaries for the preceding clauses (ii)(A) through (ii)(G)most recently ended four fiscal quarters for which internal financial statements are available.
(b) If Within 450 days after the Parentreceipt of any Net Proceeds from an Asset Sale, the Issuer or one or more of its Restricted Subsidiaries may apply an amount equal to such Net Proceeds at its option to any combination of the following:
(1) (x) if assets subject to such Asset Sale constitute Collateral, to prepay, repay or purchase (i) Indebtedness and other Obligations under the ABL Credit Agreement (or any Permitted Refinancing Indebtedness in respect thereof), (ii) Obligations in respect of the Notes, (iii) Obligations in respect of Indebtedness that is pari passu with the Notes or (iv) Indebtedness that is secured by the assets which are the subject of such Asset Sale and (y) if assets subject to such Asset Sale do not constitute Collateral, to prepay, repay or purchase Senior Indebtedness of the Issuer or any of its Restricted Subsidiaries (other than Indebtedness owed to the Issuer or another Restricted Subsidiary); provided that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (1), the Issuer or any other such Restricted Subsidiary consummates an Asset Disposition, within 360 days (or will retire such period as provided in clause (viii) below, if applicable) of Indebtedness and will cause the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor related commitment (other than obligations in respect of any asset-based credit facility (including Indebtedness under the Issuer) ABL Credit Agreement or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Sale constituted “borrowing base assets”) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; provided further that is secured on assets that do not constitute Collateral (in each caseconnection with any prepayment, repayment or purchase of Indebtedness other than Subordinated Indebtedness Obligations in respect of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notesclause (1)(x)(iii) or (iv) or (1)(y), redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of the Issuer shall also equally and ratably reduce Indebtedness under the Notes pursuant to the redemption provisions of this Indenture or by making an offer (an “Asset Disposition Offer to all Holders of the Notes Sale Offer”) (in accordance with the procedures set out belowforth below for an Asset Sale Offer with Excess Proceeds) to all Holders to purchase, on a pro rata basis (subject to adjustments to maintain the authorized denominations for the Notes), the principal amount of Notes, in each case, at a purchase price equal to 100% of the principal amount (or accreted value, as applicable) plus accrued and unpaid interest, if any, to, but excluding, the date of purchase;
(iii2) invest in any Replacement Assets;
(iv) to acquire all or substantially all of the assets of, a division or any line of business of or a majority of the Capital Stock of, another Person engaged in a Similar Permitted Business, if, after giving effect to any such acquisition of Capital Stock, such Person the Permitted Business is or becomes a Restricted SubsidiarySubsidiary of the Issuer;
(v3) to make a capital expenditureexpenditure or other expenditures in connection with the construction, operation, maintenance, repair or improvement of existing properties and assets;
(vi4) to acquire other or invest in Replacement Assets or acquire long-term assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar another Permitted Business;; or
(vii5) consummate any combination of the foregoing; or
provided that in the case of clauses (viii2), (3) enter and (4) above, (i) any such acquisition, expenditure or investment in accordance with such clause may be made by means of an acquisition, expenditure or investment by a Restricted Subsidiary in an amount equal to the Net Proceeds received by the Issuer or another Restricted Subsidiary, (ii) if the Issuer or any Restricted Subsidiary enters into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i)within such 450 day period, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a such binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from such Asset Sale if an amount equal to such Net Proceeds is applied within 180 days of the end of the 450 day period (provided further that if such commitment is later terminated or canceled before such Net Proceeds are applied and the Issuer or any Restricted Subsidiary enters into another binding commitment (the “Second Commitment”) within 180 days of such cancellation or termination (or, if later, 450 days from the date receipt of such commitment until Net Proceeds), such Second Commitment shall be treated as a binding commitment; provided further that if any Second Commitment is later terminated or canceled before such Net Proceeds are applied, then such Net Proceeds shall constitute Excess Proceeds if not otherwise applied as provided above within 450 days of the earlier receipt of such Net Proceeds), (xiii) the date on which if assets subject to such Asset Sale constitute Collateral, any assets acquired or investment is consummated, described in clauses (2) and (y4) above shall be pledged as Collateral to secure the 180th day following Notes to the expiration of extent required by the aforementioned 360-day periodNotes Collateral Documents (and pursuant to the terms thereof) and (iv) if assets subject to such Asset Sale constitute Collateral, if any such assets underlying any expenditure described in clause (3) above shall be pledged as Collateral to secure the investment has not been consummated Notes to the extent required by that datethe Notes Collateral Documents (and pursuant to the terms thereof).
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of the amount of any such Net Available CashProceeds, the Parent Issuer or any of its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings or otherwise utilize such apply the Net Available Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. Holders of Notes may not have control of, or a perfected security interest in the Net Proceeds, which could diminish the value of the Collateral.
(d) On the 361st day (The amount of any Net Proceeds from Asset Sales that is not applied or the 541st day if a binding commitment invested as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if above will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $60 15.0 million, within 30 days thereof, unless waived or modified with the consent of the Holders of at least a majority in aggregate principal amount of the Notes then outstanding, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) Sale Offer to all Holders and, of Notes (with a copy to the extent the Issuer elects, to Trustee) and all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, pari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem such Indebtedness with the proceeds of sales of assets to purchase the maximum principal amount of Notes and any such other Senior pari passu Indebtedness that may be purchased out of the Excess Proceeds, at an . The offer price, price in respect of the Notes, any Asset Sale Offer will be equal to no less than 100% of the principal amount thereof being purchased, plus accrued and unpaid interest, if any, to, to but not includingexcluding, the date of purchase, and will be payable in cash. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer obligation with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) Proceeds from Asset Sales by making an Asset Sale Offer with respect to all or part a portion of the available Net Available Cash Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture (the “Advance Offer”). If any Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) remain after consummation of an Asset Sale Offer, the Issuer may use those Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Issuer will select the Notes and such other pari passu Indebtedness to be purchased on a pro rata basis (subject to adjustments to maintain the authorized denominations for the Notes). Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
(ie) The Issuer will comply, to the extent applicable, comply in all material respects with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other securities laws or and regulations thereunder to the extent those laws and regulations are applicable in connection with the each repurchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions of this Section 4.05Indenture, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Asset Sale provisions of this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (CPI Card Group Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Borrower will not, and will not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition Sale unless:
(i) the consideration the Parent, the Issuer Borrower or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition Sale at least equal to the Fair Market Value (including as to the value of all non-cash consideration), as determined in good faith by the Parent’s Board of Directors); and, of the shares and assets subject to such Asset Sale;
(ii) at least 75% of the consideration thereof received by the Parent Borrower or such Restricted Subsidiary receives is in respect the form of cash or cash equivalents or Additional Assets; provided, however, that the 75% limitation set forth in this clause (ii) will not apply to any Asset Sale in which the cash or cash equivalents received therefrom, determined in accordance with paragraph (b) of this Section 6.05, are equal to or greater than the after-tax cash and cash equivalents that would have been received therefrom had such Asset Disposition consists of:provision applied; and
(Aiii) cash (including any an amount equal to 100% of the Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption Sale is applied by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated Borrower in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of accordance with Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)2.13.
(b) If For the Parentpurposes of this Section 6.05, the Issuer following are deemed to be cash or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash tocash equivalents:
(i) (a) prepay, repay, purchase the assumption or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount discharge of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary liabilities of the Parent that is not a Guarantor Borrower (other than obligations in respect of Disqualified Stock of the IssuerBorrower or in respect of liabilities that are by their terms subordinated to the Obligations) or any Indebtedness that is secured on assets that do not constitute Collateral Restricted Subsidiary (in each case, other than Subordinated Indebtedness obligations in respect of Disqualified Stock or Preferred Stock of a Subsidiary Guarantor or in respect of liabilities that are by their terms subordinated to the Subsidiary Guarantee of a Subsidiary Guarantor) and the release of the Issuer Borrower or a Guarantor or Indebtedness owed to the Parent or any such Restricted Subsidiary)Subsidiary from all liability on such liabilities in connection with such Asset Sale;
(ii) purchase securities received by the Borrower or any series Restricted Subsidiary from the transferee that are converted by the Borrower or such Restricted Subsidiary into cash within 180 days of Notes pursuant to an offer to all Holders the receipt of such series of Notessecurities, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders extent of the Notes (cash received in accordance with the procedures set out below);that conversion; and
(iii) invest Designated Noncash Consideration in an amount not to exceed in the aggregate at any Replacement Assets;
one time outstanding the greater of (ivA) acquire all or substantially all $10,000,000 and (B) 2.0% of Consolidated Total Assets as of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination end of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on Borrower's most recent Quarterly Reporting Period for which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that dateinternal financial statements are available.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Term Loan Credit Agreement (Network Communications, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Issuer shall not, and will shall not permit any of the Issuer or any other Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Disposition, unless:
(i1) the consideration the Parent, the Issuer or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by the Parent’s Board of DirectorsDisposition); and
(ii2) at least 75% of the consideration therefor received by the Parent Issuer or such Restricted Subsidiary receives in respect Subsidiary, as the case may be (which, for purposes of this clause (2), consideration will not include any contingent payment obligations related to such Asset Disposition consists Disposition, including, earn-out payments, purchase price adjustments and deferred purchase price payments), is in the form of cash or Cash Equivalents; provided that the amount of:
(A) cash any liabilities, as shown on the Issuer’s or such Restricted Subsidiary’s most recent balance sheet or in the notes thereto, of the Issuer or any of its Restricted Subsidiaries (including other than contingent liabilities and liabilities that are by their terms subordinated to the Notes) (i) that are assumed by the transferee of any Net Cash Proceeds received such assets and from which the conversion within 180 days Issuer or such Restricted Subsidiary has been validly released by all creditors in writing, or (ii) in respect of which neither the Issuer nor any Restricted Subsidiary following such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition)has any obligation;
(B) Cash Equivalents;
(C) the assumption any securities or other obligations received by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any such Restricted Subsidiary from such transferee that are converted by the Issuer or such Restricted Subsidiary into cash or Cash Equivalents (to the extent of the other Restricted Subsidiaries remains obligated in respect of such liabilities, cash or (yCash Equivalents received) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if within 180 days following the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result closing of such Asset Disposition;
(D) Replacement Assets;
(EC) any Capital Stock Stock, properties or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b4.11(b)(2);
(FD) consideration consisting cash held in escrow as security for any purchase price settlement, for damages in respect of Indebtedness a breach of representations and warranties or covenants or for payment of other contingent obligations in connection with such Asset Disposition; and
(E) any Designated Noncash Consideration received by the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (E) that is at any one that time outstanding, not to exceed the greater of 15(x) $20.0 million and (y) 1.5% of Consolidated EBITDA and $150 million (the Total Assets of the Issuer at the time of the receipt of such Designated Noncash Consideration, with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination , in each case, shall be deemed to be Cash Equivalents for purposes of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)this provision and for no other purpose.
(b) If Within 365 days after the Parentreceipt of any Net Cash Proceeds of any Asset Disposition, the Issuer or any other such Restricted Subsidiary consummates an Asset DispositionSubsidiary, within 360 days (or such period as provided in clause (viii) belowat its option, if applicable) of may apply the later of the date of consummation of Net Cash Proceeds from such Asset Disposition and receipt to one or more of such Net Available Cashthe following, the Parent or its Restricted Subsidiaries may use the Net Available Cash toany combination,
(1) to reduce or repay:
(iA) First Lien Claims (aprovided, that if the Issuer or any Restricted Subsidiary shall so reduce First Lien Claims other than the Notes, the Issuer will equally and ratably reduce Obligations under the Notes) prepayand to the extent the Obligations under the Notes are reduced or repaid, repaythey shall be reduced or repaid in accordance with Section 3.07, purchase or redeem (including through open market purchasespurchases of the Notes (provided, voluntary tender offers that such purchases are at or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in above 100% of the preceding clause (i)(aprincipal amount thereof), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out forth below for an Asset Disposition Offer (as defined below)); provided, that all Net Cash Proceeds used to make such an offer to purchase shall be deemed to have been so applied whether or not accepted by the Holders;
(iiiB) invest to the extent the property that is subject to such Asset Disposition was sold by a non-Guarantor Subsidiary, Indebtedness of a non-Guarantor Subsidiary, other than Indebtedness owed to the Issuer or another Restricted Subsidiary; or
(2) to make (A) an Investment in any Replacement Assets;
(iv) acquire all one or substantially all more businesses; provided that such Investment in any business is in the form of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, Stock of a Restricted Subsidiary or results in the Issuer or its Restricted Subsidiaries owning an amount of the Capital Stock of such Person is or becomes business such that it constitutes a Restricted Subsidiary;
(v) make ; provided further, that if such Asset Disposition is of Collateral and such Restricted Subsidiary is not already a capital expenditure;
(vi) acquire other Guarantor, such Restricted Subsidiary shall become a Guarantor and the assets (other than Capital Stock and cash or Cash Equivalents) that are the subject of such Investment shall at the time of such Investment constitute Collateral to the extent they are not Excluded Rigs, (B) capital expenditures in respect of the Issuer, its Restricted Subsidiaries or their respective assets or (C) acquisitions of other properties or assets to be held by the Issuer or its Restricted Subsidiaries (including assets that replace the business, properties and assets of the Issuer or any of its Restricted Subsidiaries that were the subject of such Asset Disposition), in the case of each of (A), (B) and (C), used or useful in a Similar Related Business;
(vii) consummate any combination ; provided, that if such Asset Disposition is of Collateral, in each case the foregoingproperty subject to such acquisitions shall at the time of such acquisitions constitute Collateral to the extent such property is not an Excluded Rig; or
(viii) enter into or provided that a binding commitment to apply the Net Available Cash pursuant to Proceeds as set forth in Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v4.11(b) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Issuer or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of the end of such 365-day period (xan “Acceptable Commitment”) and, in the date on which event any Acceptable Commitment is later cancelled or terminated for any reason before the Net Cash Proceeds are applied in connection therewith, then the Issuer or such investment is consummated, and (y) Restricted Subsidiary shall be permitted to apply the 180th day following Net Cash Proceeds in any manner set forth above before the expiration of the aforementioned 360such 180-day periodperiod and, if in the investment has not been consummated by that dateevent the Issuer or such Restricted Subsidiary fails to do so, then such Net Cash Proceeds shall constitute Excess Proceeds (as defined below).
(c) The amount of such Any Net Available Cash Proceeds from an Asset Disposition that are not so used invested or applied as provided and within the time period set forth above constitutes in Section 4.11(b) will be deemed to constitute “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the ”. The Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to shall make an offer to all Holders of the Notes (an “Asset Disposition Offer”) to and all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Additional First Lien Indebtedness that is Pari Passu Indebtednesscontaining provisions similar to those set forth in this Indenture with respect to offers to purchase, prepay or redeem with the proceeds of sales of assets to purchase purchase, prepay or redeem the maximum aggregate principal amount of the Notes (equal to $2,000 or integral multiples of $1,000 in excess thereof) and any such other Senior Additional First Lien Indebtedness (plus all accrued interest on such Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith), that may be purchased out of the Excess Proceeds, Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof (or, in the event such Notes or Additional First Lien Indebtedness were issued with original issue discount, 100% of the accreted value thereof), plus accrued and unpaid interest, if any, interest to, but not including, the date fixed for the closing of purchase. The Asset Disposition Offer in respect such offer (subject to the rights of Notes will be made Holders on the relevant record date to receive interest due on the relevant interest payment date), in accordance with the procedures set forth in this IndentureIndenture or the agreements governing such Additional First Lien Indebtedness, in minimum denominations as applicable. The Issuer shall commence an Asset Disposition Offer with respect to Excess Proceeds within 30 days after the date that Excess Proceeds exceed $30.0 million by delivering the notice required pursuant to Section 3.10, with a copy to the Trustee. The Issuer may, at its election, satisfy the foregoing obligations with respect to any Net Cash Proceeds from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Cash Proceeds prior to the expiration of $200,000 and in integral multiples of $1,000 in excess thereofthe relevant 365-day period (or such longer period provided above).
(ed) To the extent that the aggregate amount of Notes and Additional First Lien Indebtedness tendered pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Issuer may use any remaining Excess Proceeds for any purpose not prohibited by this Indenture. If the aggregate principal amount of Notes and Additional First Lien Indebtedness surrendered by such holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and the applicable agent or the Issuer shall select such Additional First Lien Indebtedness to be purchased on a pro rata basis based on the accreted value or principal amount of the Notes tendered (with adjustments as necessary so that no Notes will be repurchased in part in an unauthorized denomination) or such Additional First Lien Indebtedness tendered. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero zero.
(regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration e) Pending the final application of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Issuer (or the applicable Restricted Subsidiary) may temporarily reduce revolving credit borrowings or otherwise invest the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of in any such Indebtedness tendered in an Asset Disposition Offer manner that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so prohibited by this Indenture.
(if) The Issuer will comply, to the extent applicable, shall comply with the requirements of Section 14(e) of Rule 14e-l under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Notes pursuant to this Indenturean Asset Disposition Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.05Indenture, the Issuer will shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under described in this Indenture by virtue of such compliance.
(j) Except as otherwise provided thereof. Notwithstanding anything to the contrary in this Section 9.014.11, the provisions of this Indenture relating Issuer shall not, and shall not permit any Restricted Subsidiary, directly or indirectly, to the Issuer’s obligation to make an consummate any Asset Disposition Offer may be waived or modified with the consent that would result in a violation of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)Section 4.22.
Appears in 1 contract
Sources: Indenture
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition of Notes Collateral unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at least equal to the Fair Market Value (such Asset Disposition is not less than the fair market value of the assets disposed of as of Fair Market Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andNotes Collateral subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, ; provided that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash cash Consideration received by the Parent Company or any Restricted Subsidiary in an Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (2) that is at any one that time outstanding, not to exceed the greater of 15$10.0 million and 1.5% of Consolidated EBITDA and $150 million Total Assets at the time of the receipt of such Designated Non-cash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value), shall be deemed to be Cash Equivalents for purposes of this clause (2) and clause (b)(2)(a) below; orand
(H3) any combination of the types of remaining consideration specified from such Asset Disposition that is not in the preceding clauses (ii)(A) through (ii)(G)form of cash or Cash Equivalents is thereupon with its acquisition pledged as the Notes Collateral to secure the Notes.
(b) If the ParentFor purposes of Section 3.5(a)(2) hereof, the Issuer following shall be deemed to be cash: (a) the repayment or assumption of Indebtedness secured by Liens with a priority to the Liens in favor of the Notes and the Note Guarantees (other than Indebtedness incurred in contemplation of such Asset Disposition) and (b) any securities, notes or other obligations received by the Company or any other such Restricted Subsidiary consummates an Asset Dispositionfrom such transferee that are, within 360 180 days (of the disposition of Collateral, converted by the Company or such period as provided Restricted Subsidiary into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents (of the variety described in clause clauses (viii1) below, if applicablethrough (7) of the later definition thereof) received in that conversion.
(c) Any Net Proceeds from any Asset Disposition or Recovery Event in respect of Notes Collateral may be (1) invested by the Company or a Restricted Subsidiary in additional assets constituting Notes Collateral (including, without limitation, through capital expenditures or acquisitions of assets constituting Notes Collateral other than Capital Stock of Foreign Subsidiaries, or in the case of Net Proceeds from any Recovery Event, the performance of a restoration of the affected Collateral) within 365 days of the date of consummation of such Asset Disposition or Recovery Event, which additional assets are thereupon with their acquisition added to the Notes Collateral securing the Notes or (2) used to repay (and correspondingly reduce commitments with respect to) Pari Passu Lien Indebtedness; provided, that the Company will equally and ratably reduce Indebtedness under the Notes by making an offer to all Holders to purchase at a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, such offer to be conducted in accordance with the procedures set forth below for a Collateral Disposition Offer but without any further limitation in amount; provided, further, that in the case of clause (1) above, a binding commitment shall be treated as a permitted application of the Net Proceeds from the date of such commitment so long as the Company or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Proceeds will be applied to satisfy such commitment within 180 days of such commitment and, in the event that such commitment is later cancelled or terminated for any reason before the Net Proceeds are applied in connection therewith, the Company or such Restricted Subsidiary enters into another binding commitment (a “Collateral Proceeds Second Commitment”) within 180 days of such cancellation or termination (or, if later, 365 days after the receipt of such Net Available CashProceeds); provided, further, that if any Collateral Proceeds Second Commitment is later cancelled or terminated for any reason before such Net Proceeds are applied, then such Net Proceeds shall constitute Excess Collateral Proceeds.
(d) The Company and the Guarantors shall not reinvest the proceeds of Asset Dispositions of ABL Collateral in the Capital Stock of Foreign Subsidiaries.
(e) Any Net Proceeds from Asset Dispositions of Notes Collateral or Recovery Events that are not applied or invested as provided in this subsection (a) or in accordance with the Collateral Documents will be deemed to constitute “Excess Collateral Proceeds.” When the aggregate amount of Excess Collateral Proceeds exceeds $20.0 million, within 15 days thereof the Company will be required to make an offer (“Collateral Disposition Offer”) to all Holders and all holders of other Pari Passu Lien Indebtedness containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of Notes Collateral to purchase the maximum principal amount of the Notes and such Pari Passu Lien Indebtedness (on a pro rata basis) to which the Collateral Disposition Offer applies that may be purchased out of the Excess Collateral Proceeds, at an offer price in cash in an amount equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest to the date of purchase, in accordance with the procedures set forth in this Indenture; provided that to the extent the Excess Collateral Proceeds relate to Asset Dispositions of ABL Collateral, the Parent or its Restricted Subsidiaries Company may, prior to making a Collateral Disposition Offer, make a prepayment with respect to the maximum principal amount of Indebtedness that is secured by such Notes Collateral on a first-priority basis that may be prepaid out of such Excess Collateral Proceeds, at a price in cash in an amount equal to 100% of the principal amount of such Indebtedness, plus accrued and unpaid interest, to the date of prepayment, with any Excess Collateral Proceeds not used to prepay such Indebtedness offered to Holders in accordance with this Section 3.5(e). To the extent that the aggregate amount of Notes and other Pari Passu Lien Indebtedness so validly tendered and not properly withdrawn pursuant to a Collateral Disposition Offer is less than the Excess Collateral Proceeds (after giving effect to the prepayment of Indebtedness secured on a first-priority basis in the case of an Asset Disposition of ABL Collateral), the Company may use any remaining Excess Collateral Proceeds for general corporate purposes, subject to the Net Available Cash other covenants contained in this Indenture. If the aggregate principal amount of Notes surrendered by Holders and Pari Passu Lien Indebtedness tendered into such Collateral Disposition Offer exceeds the amount of Excess Collateral Proceeds, the Notes and Pari Passu Lien Indebtedness to be purchased shall be selected on a pro rata basis. Upon completion of such Collateral Disposition Offer, the amount of Excess Collateral Proceeds shall be reset at zero.
(f) The Company will not, and will not permit any Restricted Subsidiary to, make any Asset Disposition (other than Asset Dispositions of Notes Collateral which shall be treated in the manner set forth in Section 3.5(a) above) unless:
(i1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Disposition at least equal to the Fair Market Value of the assets or Equity Interests issued or sold or otherwise disposed of; and
(2) at least 75% of the consideration received in the Asset Disposition by the Company or such Restricted Subsidiary is in the form of cash. For purposes of this provision, each of the following will be deemed to be cash:
(a) prepayCash Equivalents; provided that any Designated Non-cash Consideration received by the Company or any Restricted Subsidiary in an Asset Disposition having an aggregate Fair Market Value, repaytaken together with all other Designated Non-cash Consideration received pursuant to this clause (a) that is at that time outstanding, purchase or redeem not to exceed the greater of $10.0 million and 1.5% of Total Assets at the time of the receipt of such Designated Non-cash Consideration (including through open market purchaseswith the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value), voluntary tender offers or privately negotiated transactions at market pricesshall be deemed to be Cash Equivalents for purposes of this clause (a) any Senior Indebtedness Incurred under and Section 4.01(b)(i); 3.5(a)(2) above;
(b) unless included any liabilities, as shown on the Company’s most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Note Guarantee and Indebtedness incurred in contemplation of such Asset Disposition) that are assumed by the preceding transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary from further liability;
(c) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are, within 180 days of the Asset Disposition, converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents (of the variety described in clauses (1) through (7) of the definition thereof) received in that conversion; and
(d) any stock or assets of the kind referred to in clause (i)(a3) or (5) of Section 3.5(g).
(g) Within 365 days after the receipt of any Net Proceeds from an Asset Disposition subject to Section 3.5(f), prepaythe Company (or the applicable Restricted Subsidiary, repayas the case may be) may apply such Net Proceeds at its option:
(1) to repay Secured Indebtedness secured by a Permitted Lien on the assets (provided that such Permitted Lien is not pari passu with or subordinate to the Lien on such assets in favor of the Holders) subject to such Asset Disposition or Indebtedness of the applicable Restricted Subsidiary of the Company (if such Restricted Subsidiary is not a Guarantor) and if such Indebtedness is revolving credit Indebtedness, purchase or redeem to correspondingly reduce commitments with respect thereto;
(including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices2) any to repay (and correspondingly reduce commitments with respect to) Pari Passu Lien Indebtedness; provided that the Parent, Company will equally and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu ratably reduce Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before under the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) Notes by making an offer to all Holders to purchase Notesat a purchase price equal to 100% of the principal amount thereof, plus accrued and unpaid interest, such offer to be conducted in accordance with the provisions procedures set forth below for an Asset Disposition Offer, Offer but without further limitation in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary)amount;
(ii3) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Permitted Business, if, after giving effect to any such acquisition of Capital Stock, such Person the Permitted Business is or becomes a Restricted SubsidiarySubsidiary of the Company;
(v4) to make a capital expenditure;; or
(vi5) to acquire other assets (other than Capital Stock that are not classified as current assets under GAAP and cash or Cash Equivalents) that are used or useful in a Similar Permitted Business;
; provided, however, that in the cause of clauses (vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i3), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v(4) or Section 4.05(b)(viand (5) or a combination thereof; provided thatabove, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Company or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Proceeds will be applied to satisfy such commitment within 180 days of such commitment and, in the event that such commitment is later cancelled or terminated for any reason before the Net Proceeds are applied in connection therewith, the Company or such Restricted Subsidiary enters into another binding commitment (xa “Second Commitment”) the date on which within 180 days of such investment is consummated, and cancellation or termination (y) the 180th day following the expiration of the aforementioned 360-day periodor, if later, 365 days after the investment has not been consummated by that date.
(c) The amount receipt of such Net Available Cash not so used as set forth above constitutes “Proceeds); provided, further, that if any Second Commitment is later cancelled or terminated for any reason before such Net Proceeds are applied, then such Net Proceeds shall constitute Excess Proceeds.” ;
(h) Pending the final application of any such Net Available CashProceeds, the Parent or any Restricted Subsidiary Company may temporarily reduce revolving credit borrowings or otherwise utilize such invest the Net Available Cash Proceeds in any manner that is not prohibited by the terms of this Indenture.
(di) On the 361st day (Any Net Proceeds from Asset Dispositions that are not applied or the 541st day if a binding commitment invested as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if provided above will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $60 20.0 million, within 15 days thereof, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to and all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, Lien Indebtedness containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets to purchase the maximum principal amount of Notes and any such other Senior Pari Passu Lien Indebtedness that may be purchased out of the Excess Proceeds, at an . The offer price, price in respect of the Notes, any Asset Disposition Offer will be equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes , and will be made payable in accordance with the procedures set forth in this Indenture, in minimum denominations cash. If any Excess Proceeds remain after consummation of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such an Asset Disposition Offer, the amount of Company may use those Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and other Pari Passu Lien Indebtedness tendered into such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among Trustee will select the tendering Holders of Notes and such other Senior Pari Passu Lien Indebtedness to be purchased on a pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Periodbasis. Upon completion of any each Asset Disposition Offer, the amount of Excess Proceeds shall will be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(gj) The Collateral Disposition Offer or Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior (and other Indebtedness required to be repaid or purchased by it pursuant to such offer Section 3.5(e)) and Pari Passu Lien Indebtedness required to be purchased pursuant to this Section 3.5 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes (and Senior other Indebtedness that is required to be purchased pursuant to Section 3.5(e)) and Pari Passu Indebtedness Lien Indebtedness, if applicable, validly tendered in response to the Collateral Disposition Offer or Asset Disposition Offer, as applicable. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest will be paid on such Asset Disposition Purchase Date to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Collateral Disposition Offer or Asset Disposition Offer.
(hk) The Parent and its Restricted Subsidiaries may satisfy Upon the foregoing obligations with respect to any Net Available Cash from an commencement of a Collateral Disposition Offer or Asset Disposition Offer, as applicable, the Company will send, by making an first class mail, a notice to the Trustee and each of the Holders. The notice will contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Collateral Disposition Offer or Asset Disposition Offer, as applicable. The notice, which will govern the terms of the Collateral Disposition Offer or Asset Disposition Offer, as applicable, will state:
(1) that the Collateral Disposition Offer or Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of is being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes made pursuant to this Indenture. To Section 3.5 and the extent that length of time the provisions of any securities laws Collateral Disposition Offer or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived will remain open;
(2) the Asset Disposition Offer Amount, the purchase price and the Asset Disposition Purchase Date;
(3) that any Security not tendered or modified with accepted for payment will continue to accrue interest;
(4) that, unless the consent of Holders of a majority Company defaults in outstanding principal amount of the Notes (with making such consentpayment, any Note accepted for the avoidance of doubt, payment pursuant to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).t
Appears in 1 contract
Sources: Indenture (REV Group, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (at least equal to the Fair Market Value, as determined in good faith by the Parent’s Board of Directors, the determination of which shall be evidenced by a Board Resolution (including as to the value of all non-cash consideration), of the shares and assets subject to such Asset Disposition; and
(ii) at least 7585% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of cash or cash equivalents; (iii) the Company delivers an Officers' Certificate to the Trustee certifying that such Asset Disposition consists of:
complies with clauses (i) and (ii); and (iv) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesfirst, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such the Company elects (or is required by the terms of any Senior Indebtedness or the 10 5/8% Notes), to prepay, repay or purchase Senior Indebtedness or Indebtedness (iincluding the 10 5/8% Notes but other than any Preferred Stock) has been extinguished by of a Wholly Owned Subsidiary (in each case other than Indebtedness owed to the Issuer Company or the applicable Guarantor, and (ii) is not Subordinated Indebtedness an Affiliate of the Issuer or such Guarantor;
(GCompany) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 270 days (or such period as provided in clause (viii) below, if applicable) of from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; (B) second, to the Parent or its Restricted Subsidiaries may use extent of the balance of Net Available Cash to:
after application in accordance with clause (iA), to the extent the Company or such Restricted Subsidiary elects, to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary) within 270 days from the later of such Asset Disposition or the receipt of such Net Available Cash; (C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B) (a) prepaysuch balance being the "Excess Proceeds"), repayto make an Offer to purchase Securities pursuant to and subject to the conditions of the following two paragraphs; provided, however that in connection with any prepayment, repayment or purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior of Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding pursuant to clause (i)(a)A) or (C) above, prepaythe Company or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repayrepaid or purchased. Notwithstanding the foregoing provisions of this provision, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, Company and its Restricted Subsidiaries shall not be entitled required to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, apply any Net Available Cash in accordance with this provision except to the provisions extent that the aggregate Net Available Cash from all Asset Dispositions which are not applied in accordance with this provision exceed $15 million (taking into account income earned on any Excess Proceeds). Pending application of Net Available Cash pursuant to this provision, such Net Available Cash shall be invested in Temporary Cash Investments. Upon an Event of Loss incurred by the Company or any of its Restricted Subsidiaries, the Net Available Cash received from such Event of Loss shall be applied in the same manner as proceeds from Asset Dispositions described above and pursuant to the procedures set forth below for in Section 4.06(c) below.
(b) In the event of an Asset Disposition Offeror Event of Loss that requires the purchase of Securities pursuant to Section 4.06(a)(iv)(C), in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would Company will be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, required to purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes Securities tendered pursuant to an offer to all Holders by the Company for the Securities (the "Offer") which offer shall be in the amount of such series the Allocable Excess Proceeds (as defined below), at a purchase price of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series 100% of Notes pursuant their principal amount plus accrued interest to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (Purchase Date in accordance with the procedures (including prorationing in the event of over subscription) set out below);
(iii) invest forth in any Replacement Assets;
(iv) acquire all or substantially all the next paragraph. If the aggregate purchase price of Securities tendered pursuant to the assets ofOffer is less than the Allocable Excess Proceeds, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply Company may use the remaining Net Available Cash in its general operations and the amount of Excess Proceeds will be reset to zero. The Company shall not be required to make an Offer for Securities pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) this provision if the Excess Proceeds are less than $15 million for any particular Asset Disposition or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment Event of Loss (which lesser amounts shall be treated as a permitted application carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition or Event of Loss). "Allocable Excess Proceeds" means the date of such commitment until the earlier product of (x) the date on which such investment is consummated, Excess Proceeds and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Casha fraction, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that numerator of which is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes Securities outstanding on the date of consenting Holders represents a majority the Offer and the denominator of which is the sum of the aggregate outstanding principal amount of the Notes as a whole Securities outstanding on the date of the Offer and without regard the aggregate principal amount of other Indebtedness of the Company outstanding on the date of the Offer that is pari passu in right of payment with the Securities and subject to terms and conditions in respect of Asset Dispositions similar in all material respects to the level of consent obtained among Holders of each constituent series of Notes)covenant described hereunder and requiring the Company to make an offer to purchase such Indebtedness substantially at the same time as the Offer.
Appears in 1 contract
Sources: Indenture (Rio Hotel & Casino Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i) the consideration the Parent, the Issuer The Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition at least equal to the fair market value, as determined in good faith by the Company (including as to the value of all non-cash consideration), of the shares and assets subject to such Asset Disposition and at least 75.0% of the consideration thereof received, together with all other Asset Dispositions since the Reference Date (on a cumulative basis), by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; provided, however, that in the case of an Asset Disposition (x) involving the disposition of non-core assets (as determined by the Parent’s Board Company in its good faith judgment) acquired as part of Directors); and
any acquisition after the Issue Date or (iiy) at least 75for aggregate consideration of less than $100.0 million, only 50.0% of the consideration therefor must be in the Parent form of cash or such Restricted Subsidiary receives in respect of such Asset Disposition consists ofCash Equivalents; provided further that:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiespromissory notes, notes securities or other obligations or amounts received in consideration by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash within 360 days of such Asset Dispositionthe receipt thereof (to the extent of the cash received) shall be deemed to be cash solely for purposes of this Section 10.16(a)(i);, and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash cash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant Section 10.16(a)(i)(B) that is at any one that time outstanding, not to exceed the greater of 15(x) $225.0 million and (y) 6.0% of Consolidated EBITDA and $150 million Tangible Assets at the time of receipt of such Designated Non-cash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value) shall be deemed to be cash solely for purposes of this Section 10.16(a)(i); and
(ii) an amount equal to 100.0% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be), at its option except as described below:
(A) (x) to the extent the Company elects (or is required by the terms of any Senior Indebtedness or any Indebtedness of any non-Guarantor Subsidiary), to prepay, repay or purchase Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary of the Company within 365 days of such Asset Disposition, (y) at the Company’s election, to the investment by the Company or such Restricted Subsidiary in assets to replace the assets that were the subject of such Asset Disposition or assets that (as determined in good faith by the Company) are directly related to the business of the Company and the Restricted Subsidiaries existing on the Acquisition Closing Date, in each case within 365 days from the date of such Asset Disposition, or (z) a combination of the foregoing purposes within such 365-day period; or
(HB) to make a pro rata offer to purchase Notes at par (and, to the extent required by the instrument governing such Indebtedness, any combination other Senior Indebtedness or Indebtedness of a non-Guarantor Subsidiary designated by the Company, at a price no greater than par) plus accrued and unpaid interest, which offer can be made at the Company’s election at any time during the 365-day period set forth in Section 10.16(a)(ii)(A) or within 10 Business Days after such period; and
(C) to the extent of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt balance of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, after application in accordance with Sections 10.16(a)(ii)(A) and 10.16(a)(ii)(B), for general corporate purposes otherwise permitted under this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to Sections 10.16(a)(ii)(A) or 10.16(a)(ii)(B), the provisions set forth below for an Asset Disposition Offer, Company or such Subsidiary shall retire such Indebtedness and cause the related loan commitment (if any) to be permanently reduced in such an amount as would reduce equal to the aggregate principal amount of Notes then outstanding so prepaid, repaid or purchased; provided, further, that in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) connection with any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash investment pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v10.16(ii)(A)(y) or Section 4.05(b)(vi) or a combination thereof; provided thatabove, a binding commitment entered into during the 365-day period described in Section 10.16(ii)(A) above shall be treated as a permitted application of the Net Available Cash from such Asset Disposition from the date of such commitment until so long as the earlier of (x) Company or such Restricted Subsidiary enters into such commitment with the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360good-day period, if the investment has not been consummated by faith expectation that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes will be applied to satisfy such commitment within 180 days of such commitment (an “Excess Proceeds.” Pending the final application of Acceptable Commitment”); provided, further, that, if any Acceptable Commitment is later cancelled or terminated for any reason before such Net Available CashCash is applied, then the Parent or any Company and its Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize Subsidiaries shall be required to apply such Net Available Cash in accordance with this Section 10.16. Notwithstanding the foregoing provisions of this Section 10.16, the Company and its Restricted Subsidiaries shall not be required to apply any manner Net Available Cash in accordance with this Section 10.16 except to the extent that the aggregate Net Available Cash from all Asset Dispositions (including any Asset Dispositions made since the Issue Date) which are not applied in accordance with this Section 10.16 exceeds the greater of (i) $235.0 million and (ii) 6.0% of Consolidated Tangible Assets as of the date of such Asset Disposition. For the purposes of this Section 10.16, the following is deemed to be cash or Cash Equivalents: the express assumption of Indebtedness (other than any Indebtedness that is not prohibited by its terms subordinated to the terms Notes or to any Subordinated Obligation) of this Indenturethe Company or any Restricted Subsidiary and for which the Company or such Restricted Subsidiary has been validly released by all creditors in writing.
(db) On In the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after event of an Asset DispositionDisposition that results in an offer to purchase the Notes (and other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) pursuant to Section 10.16(a)(ii)(B), the Company or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof Restricted Subsidiary shall purchase Notes tendered pursuant to make an offer by the Company for the Notes (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer electsrequired, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to of any non-Guarantor Subsidiary) at a purchase the maximum price of 100.0% of their principal amount (without premium) plus accrued but unpaid interest (or, in respect of Notes and any such other Senior Indebtedness that may be purchased out or Indebtedness of the Excess Proceedsany non-Guarantor Subsidiary, at an offer such lesser price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, toas may be provided for by the terms of such Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made as applicable) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this IndentureIndenture which shall include, among other things, that the offer shall remain open for 20 Business Days following its commencement. If the aggregate purchase price of Notes (and, to the extent required, any other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) tendered pursuant to such offer is less than the Net Available Cash allotted to the purchase thereof, the Company shall be entitled to apply the remaining Net Available Cash in minimum denominations accordance with Section 10.16(a)(ii)(A) or (C). The Company shall not be required to make such an offer to purchase Notes (and other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) pursuant to this Section 10.16 if the Net Available Cash available therefor is less than the greater of (i) $200,000 235.0 million and (ii) 6.0% of Consolidated Tangible Assets (which lesser amount shall be carried forward for purposes of determining whether such an offer is required with respect to any subsequent Asset Disposition). The Company shall not be required to make such an offer to purchase Notes (and other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) pursuant to this Section 10.16 if a third party (including any of the Company’s Restricted Subsidiaries) makes the offer in integral multiples of $1,000 the manner, at the times and otherwise in excess thereof.
(e) compliance with the requirements set forth in this Indenture applicable to such an offer by the Company and purchases all Notes validly tendered and not withdrawn under such offer. Upon completion of any such Asset Disposition Offeroffer by the Company for Notes, the amount of Excess Proceeds that resulted in the requirement Net Available Cash related to make an such Asset Disposition Offer shall be reset to zero (regardless zero, and during the pendency of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected offer by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Company for Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash being effected in advance of being required to do so by this Indenture, the amount of Net Available Cash the Company is offering to apply in such offer shall be excluded in subsequent calculations of Net Available Cash in respect of subsequent Asset Dispositions. Pending the final application of any Net Available Cash pursuant to Section 10.16(a)(ii), the Company or the applicable Restricted Subsidiary may apply such Net Available Cash temporarily to reduce Indebtedness outstanding under a revolving credit facility or otherwise invest such Net Available Cash in cash and Cash Equivalents or Investment Grade Securities.
(ic) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 10.16. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.0510.16, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 10.16(c) by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Terex Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Borrower shall not, and will shall not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition following the date hereof unless:
(i) the consideration the Parent, the Issuer Borrower or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at least equal to the Fair Market Value (such Asset Disposition is not less than the fair market value of the assets disposed of Fair Market Value to be determined as of the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors)assets subject to such Asset Disposition; and
(ii) at least 75% of the consideration from such Asset Disposition received by the Parent Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents. The Borrower shall determine the Fair Market Value of any consideration from such Asset Disposition that is not cash or Cash Equivalents.
(b) For the purposes of this Section 6.05, the following are deemed to be cash: (x) the assumption of Indebtedness or other liabilities of the Borrower (other than Disqualified Stock or Junior Indebtedness) or Indebtedness or other liabilities of any Restricted Subsidiary (other than Disqualified Stock or Junior Indebtedness) and the release of the Borrower or such Restricted Subsidiary receives from all liability on such Indebtedness or liabilities in respect of connection with such Asset Disposition consists of:
Disposition, (Ay) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other similar obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Borrower or any liabilities recorded on Restricted Subsidiary from the Parent’s, transferee that are converted within 180 days by the Issuer’s Borrower or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, into cash and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gz) any Designated Non-Cash cash Consideration received by the Parent Borrower or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market valueFair Market Value (determined in Good Faith by the Borrower), taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (z) that is at any one that time outstanding, not to exceed $57.5 million at the greater time of 15% the receipt of Consolidated EBITDA and $150 million such Designated Non-cash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Junior Lien Term Loan Credit Agreement (McClatchy Co)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); andthe shares and assets subject to such Asset Disposition,
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in the form of cash, assets useful in a Permitted Business or Permitted Securities, or the assumption by the purchaser of liabilities of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) as a result of which the Company and the Restricted Subsidiaries are no longer obligated with respect to those liabilities; provided that the amount of any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Disposition shall be deemed to be cash for the purposes of this provision (but for no other purpose) so long as such amount, taken together with the Fair Market Value when received of all other Designated Noncash Consideration that is at that time outstanding (i.e., that has not been sold for or otherwise converted into cash or Permitted Securities), does not exceed $50,000,000; provided, further, that (A) securities or other assets received by the Company or any Restricted Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days after the closing of such Asset Disposition shall be considered to be cash to the extent of the cash received in that conversion; and (B) any cash consideration paid to the Company or the Restricted Subsidiary in connection with the Asset Disposition that is held in escrow or on deposit to support indemnification, adjustment of purchase price or similar obligations in respect of such Asset Disposition consists ofshall be considered to be cash, and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) within 365 days after the later of the date of such Asset Disposition and the receipt of such Net Available Cash:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesto prepay, notes repay, purchase, repurchase, redeem, retire, defease or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date otherwise acquire for value Secured Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or a Subsidiary Guarantor (other than any Disqualified Stock or Subordinated Indebtedness), as a result of which none of the Parent, the Issuer Obligations) or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer not a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of in each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (case other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any an Affiliate of the Company;
(B) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes; provided, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(vin accordance with this clause (B) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted an application of the such Net Available Cash from the date of such commitment until if (i) such reinvestment is consummated within 180 days at the earlier end of such 365 day period referred to in this clause (x3) the date on which such investment is consummated, and (yii) if such reinvestment is not consummated within the 180th day following period set forth in subclause (i) or such binding commitment is terminated, the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such shall constitute available Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.; or
(dC) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”i) to all Holders and, to redeem the extent the Issuer elects, to all Notes of either series or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, make open market purchases thereof at an offer price, in respect of the Notes, equal to no a price not less than 100% of the principal amount thereof or (ii) to make an Asset Disposition Offer to purchase Notes of either series pursuant to and subject to the conditions set forth in Section 4.10(b); provided, however, that if the Company elects (or is required by the terms of any Pari Passu Indebtedness), such Asset Disposition Offer may be made ratably (determined based upon the respective principal amounts of the Notes of either series and such Pari Passu Indebtedness being purchased or repaid) to purchase the Notes of either series and to purchase or otherwise repay such Pari Passu Indebtedness; provided that pending final application of any such Net Available Cash in accordance with clause (3)(A), (B) or (C) above, the Company and the Restricted Subsidiaries may temporarily reduce revolving Indebtedness outstanding under the Credit Agreement or otherwise invest such Net Available Cash in any manner not prohibited by this Indenture. To the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) above, the Company or such Restricted Subsidiary, as the case may be, may use such balance for any general corporate purpose not prohibited by the terms of this Indenture. In connection with any prepayment, repayment, purchase, repurchase, redemption, retirement, defeasance or other acquisition for value of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary, as the case may be, will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid, purchased, repurchased, redeemed, retired, defeased or otherwise acquired for value. Notwithstanding the foregoing provisions of this Section 4.10, the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this covenant exceeds $50,000,000.
(b) In the event of an Asset Disposition that requires the purchase of Notes of either series pursuant to Section 4.10(a)(3)(C), the Company will be required
(i) to purchase Notes of such series tendered pursuant to an offer by the Company for the Notes of such series (the “Asset Disposition Offer”) at a purchase price of 100% of their principal amount plus accrued and unpaid interest, if any, to, but not including, interest thereon to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made Holders of record on the relevant date to receive interest due on the relevant Interest Payment Date) in accordance with the procedures procedures, including prorating in the event of oversubscription, set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.and
(eii) Upon completion to purchase or otherwise repay Pari Passu Indebtedness of the Company on the terms and to the extent contemplated thereby at the purchase price set forth in the relevant documentation (including accrued and unpaid interest to the date of acquisition, the “purchase price”), provided that to the extent the purchase price of any such Pari Passu Indebtedness exceeds 100% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of acquisition, the Company shall not use any Net Available Cash to pay such purchase price, except as permitted by the next sentence. If the aggregate purchase price of Notes of either series and Pari Passu Indebtedness tendered pursuant to the Asset Disposition OfferOffer is less than the Net Available Cash allotted to the purchase of the Notes of such series and Pari Passu Indebtedness, the amount Company will apply the remaining Net Available Cash for any general corporate purpose not prohibited by the terms of Excess Proceeds that resulted in the requirement this Indenture. The Company will not be required to make an Asset Disposition Offer shall for Notes of either series and Pari Passu Indebtedness pursuant to this Section 4.10 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 4.10(a)(3)(A) and (B)) is less than $50,000,000 for any particular Asset Disposition (which lesser amount will be reset carried forward for purposes of determining whether an Asset Disposition Offer is required with respect to zero (regardless of whether there are the Net Available Cash from any remaining Excess Proceeds upon such completionsubsequent Asset Disposition). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount Net Available Cash in respect of Excess Proceeds any Asset Disposition(s) shall be reset at reduced to zero.
(fc) To (i) Promptly, and in any event within 10 days after the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Company becomes obligated to make an Asset Disposition Offer, insofar as it relates the Company shall be obligated to deliver to the Trustee and send or, at the request of the Company have the Trustee send (such notice to be provided to the Trustee at least five Business Days before the Trustee is requested to send such notice. unless a shorter period shall be satisfactory to the Trustee), in the name and on behalf of the Company, by first-class mail to each Holder, or in the case of Global Notes, will remain open for send in accordance with the Applicable Procedures of the Depositary, a period written notice stating that the Holder may elect to have its Notes of not less than five either series purchased by the Company either in whole or in part (5) Business Days following its commencement (subject to prorating as hereinafter described in the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of event the Asset Disposition Offer Period is oversubscribed) in minimum denominations of $2,000 of principal amount or any greater integral multiple of $1,000 thereof, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the “Asset Disposition Purchase Date”) and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports); provided that in lieu of providing the reports specified in this subclause (1), the Issuer will purchase Company may, at its option, notify the principal amount holders that such reports are available to them in electronic format through the SEC’s ▇▇▇▇▇ system, (2) a description of Notes and, material developments in the Company’s business subsequent to the extent it electsdate of the latest of such reports, Senior Indebtedness required and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to be repaid or purchased by it tender Notes pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, together with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations address referred to in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
clause (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notesiii).
Appears in 1 contract
Sources: Indenture (Aecom Technology Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
with respect to First-Priority Collateral unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition is not less than at least equal to the fair market value of the Capital Stock and assets disposed of as of the date of entry into binding documentation in respect of subject to such Asset Disposition (as determined by the Parent’s Board of Directors); and
Disposition, (ii) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
(A) cash (including any Net or Temporary Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesInvestments, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption First-Priority Assets to be owned by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent Company or any Restricted Subsidiary having an aggregate and used in a Permitted Business, to the extent they are concurrently with their acquisition added to the First-Priority Collateral securing the Securities, or (C) Capital Stock in one or more Persons engaged in a Permitted Business that are or thereby become Wholly Owned Subsidiaries of the Company and (iii) to the extent Capital Stock of a Person is received by the Company and its Restricted Subsidiaries pursuant to clause (ii)(C) above, assets of such Person that qualify as First-Priority Assets with a fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant value that is at any one time outstanding, not equal to exceed the or greater of 15than (A) 75% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Nonthe First-Cash Consideration being measured at Priority Collateral that is the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation subject of such Asset Disposition less (B) the fair market value of any consideration received by the Company and its Restricted Subsidiaries pursuant to clause (ii)(A) or (B) above are concurrently with the acquisition added to the First-Priority Collateral securing the Securities; and (iv) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be):
(A) first, to the extent the Company or such Restricted Subsidiary elects, to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary or the application by the Company of the Net Available Cash received by a Restricted Subsidiary of the Company), in each case within 365 days (or, in the case of Foreign Subsidiary Asset Dispositions, 545 days) from the later of such Asset Disposition or the receipt of such Net Available Cash, PROVIDED that such Additional Assets constitute (x) First-Priority Assets that are concurrently with their acquisition added to the Parent First-Priority Collateral securing the Securities or its Restricted Subsidiaries may use (y) Capital Stock of a Wholly Owned Subsidiary with assets that qualify as First-Priority Assets to the extent that such First Priority Assets, together with any First-Priority Assets described in clause (x), have a fair market value that is equal to or greater than the Net Available Cash applied pursuant to this clause (A) and such First-Priority Assets are concurrently with the acquisition added to the First-Priority Collateral securing the Securities and PROVIDED FURTHER that pending the final application of any such Net Available Cash, it must be deposited in a Notes Collateral Account and pledged as additional First-Priority Collateral;
(B) second, within 365 days from the later of such Asset Disposition or the receipt of such Net Available Cash (or, in the case of Foreign Subsidiary Asset Dispositions, 545 days), to the extent of the balance of such Net Available Cash after such application in accordance with clause (A), to make an Offer (as defined below) to purchase First-Priority Obligations pursuant to and subject to the conditions set forth in Section 4.06(c); and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) (other than the second proviso thereto) and (B), for any general corporate purpose not restricted by the terms of this Indenture.
(b) The Company will not, and will not permit any Restricted Subsidiary to, make any Asset Disposition (other than an Asset Disposition of First-Priority Collateral) unless:
(i) (a) prepay, repay, purchase the Company or redeem such Restricted Subsidiary receives consideration (including through open by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition at least equal to the fair market purchasesvalue of the Capital Stock and assets subject to such Asset Disposition, voluntary tender offers (ii) at least 75% of the consideration thereof received by the Company or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included such Restricted Subsidiary is in the preceding clause form of (i)(a)A) cash or Temporary Cash Investments, prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricesB) any Pari Passu Indebtedness; provided that properties and assets to be owned by the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any Restricted Subsidiary);
Subsidiary and used in a Permitted Business or (iiC) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers Capital Stock in one or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture more Persons engaged in a Permitted Business that are or by making an Asset Disposition Offer to all Holders thereby become Restricted Subsidiaries of the Notes (in accordance with the procedures set out below);
Company, and (iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect an amount equal to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition is applied by the date Company (or such Restricted Subsidiary, as the case may be):
(A) first, (i) to the extent the Company elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem or purchase any Credit Agreement Obligations or any Indebtedness Incurred by a Subsidiary of the Company that is not a Note Guarantor, or (ii) to the extent the Company or such Restricted Subsidiary elects, to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary or the application by the Company of the Net Available Cash received by a Restricted Subsidiary of the Company), in each case within 365 days (or, in the case of Foreign Subsidiary Asset Dispositions, 545 days) from the later of such commitment until Asset Disposition or the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount receipt of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending Cash, PROVIDED that pending the final application of any such Net Available Cash, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by this Indenture;
(B) second, within 365 days from the later of such Asset Disposition or the receipt of such Net Available Cash (or, in the case of Foreign Subsidiary Asset Dispositions, 545 days), to the extent of the balance of such Net Available Cash after such application in accordance with clause (A), to make an Offer (as defined below) to purchase Securities pursuant to and subject to the conditions set forth in Section 4.06(c); PROVIDED, HOWEVER, that if the Company elects (or is required by the terms of any other Senior Indebtedness) such Offer may be made ratably to purchase the Securities and such other Senior Indebtedness of the Company; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) (other than the proviso thereof) and (B), for any general corporate purpose not restricted by the terms of this Indenture; PROVIDED, HOWEVER, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or (B) above, the Company or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 4.06, the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash from Asset Dispositions that are not Asset Dispositions of First-Priority Collateral in accordance with this Section 4.06 except to the extent that the aggregate Net Available Cash from all such Asset Dispositions since the Original Issue Date that is not applied in accordance with this Section 4.06 exceeds $10.0 million since the Original Issue Date. For the purposes of this Section 4.06, the following are deemed to be cash: (A) the assumption of any liabilities of the Company (other than Disqualified Stock of the Company) or any Restricted Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on such liabilities in connection with such Asset Disposition; PROVIDED that, with respect to any Asset Disposition of First-Priority Collateral, such liabilities constituted Trade Payables or First-Priority Obligations and (B) securities received by the Company or any Restricted Subsidiary from the transferee that are promptly converted by the Company or such Restricted Subsidiary into cash. For the purposes of this Section 4.06, any sale by the Company or a Restricted Subsidiary of the Capital Stock of a Note Guarantor that owns assets constituting First-Priority Collateral or Second-Priority Collateral shall be deemed to be a sale of such First-Priority Collateral or Second-Priority Collateral (or, in the event of a Note Guarantor that owns assets that include both First-Priority Collateral and Second-Priority Collateral, a separate sale of such First-Priority Collateral and a separate sale of such Second-Priority Collateral). In the event of any such sale (or a sale of assets that includes both First-Priority Collateral and Second-Priority Collateral), the proceeds received by the Company and the Restricted Subsidiaries in respect of such sale shall be allocated to the First-Priority Collateral and the Second-Priority Collateral in accordance with their respective fair market values, which shall be determined by Board of Directors or an independent third party as provided by the terms of the Intercreditor Agreement.
(dc) On In the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after event of an Asset Disposition, Disposition that requires the purchase of Securities (and other Senior Indebtedness) pursuant to Section 4.06(a)(iv)(B) or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million4.06(b)(iii)(B), the Issuer will Company shall be required within twenty to purchase Securities (20and other Senior Indebtedness) Business Days thereof tendered pursuant to make an offer by the Company for the Securities (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out Indebtedness) (the "Offer") at a purchase price of (i) in the Excess Proceedscase of Non-Consenting Securities, at an offer price, in respect of the Notes, equal to no less than 100% of the their Accreted Value or principal amount thereof plus accrued and unpaid interest, including Additional Interest, if any, to, but not including, to the date of purchase. The Asset Disposition Offer purchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date) or (ii) in respect the case of Notes will be made all other Securities, 100% of the sum of their principal amount plus accrued and unpaid interest, including Additional Interest, if any, to the date of purchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date), in each case, in accordance with the procedures (including proration in the event of oversubscription) set forth in Section 4.06(d). If the aggregate purchase price of Securities (and other Senior Indebtedness) tendered pursuant to the Offer is less than the Net Available Cash allotted to the purchase of the Securities (and other Senior Indebtedness), the Company shall apply the remaining Net Available Cash for any general corporate purpose not restricted by the terms of this Indenture. The Company shall not be required to make an Offer for Securities (and other Senior Indebtedness) pursuant to this Section 4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 4.06(a)(iv)(A) or 4.06(b)(iii)(A)) is less than $10.0 million for any particular Asset Disposition since the Original Issue Date (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition). Upon completion of the Offer, the amount of Net Available Cash shall be reduced to zero.
(d) (i) Promptly, and in minimum denominations of $200,000 any event within 10 days after the Company becomes obligated to make an Offer, the Company shall be obligated to deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to proration as hereinafter described in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Company which the Company in excess thereof.
(e) Upon completion of any good faith believes will enable such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement Holders to make an Asset Disposition Offer informed decision (which at a minimum shall be reset to zero include (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and 1) the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based most recently filed Annual Report on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five Form 10-K (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(eincluding audited consolidated financial statements) of the Exchange Act Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other securities laws than Current Reports describing Asset Dispositions otherwise described in the offering materials (or regulations corresponding successor reports), (2) a description of material developments in connection the Company's business subsequent to the date of the latest of such reports, and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to the Offer, together with the repurchase of Notes pursuant address referred to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
in clause (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notesd)(iii).
Appears in 1 contract
Sources: Indenture (Uniplast Industries Co)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration at the time of such Asset Disposition at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Board of Directors of the Company, of the shares and assets subject to such Asset Disposition;
(2) other than with respect to any assets contributed by the Company or a Restricted Subsidiary to a joint venture formed by the Company or such Restricted Subsidiary, respectively, at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents; provided, however, that the 75% limitation also will not less than apply to any disposition of assets in exchange for assets used in a Related Business, or a combination of such assets and cash or cash equivalents, in each case having a fair market value comparable to the fair market value of the assets disposed of as by the Company or a Restricted Subsidiary; provided further, however, that in any such exchange of the date Company's or a Restricted Subsidiary's assets with a fair market value in excess of entry into binding documentation $20 million, the Company must obtain an opinion or report from an Independent Qualified Party confirming that the assets, and cash and cash equivalents, if any, received in respect of such Asset Disposition (as determined by exchange have a fair market value at least equal to the Parent’s Board of Directors)assets so exchanged; and
(ii3) at least 75an amount equal to 100% of the consideration Net Available Cash from such Asset Disposition is applied by the Parent Company (or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:Subsidiary, as the case may be)
(A) cash first, to the extent the Company elects (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption is required by the purchaser terms of (x) any liabilities recorded on the Parent’sIndebtedness), the Issuer’s to prepay, repay, redeem or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date purchase Senior Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or Indebtedness (other than Subordinated Indebtedness), as any Disqualified Stock) of a result of which none Wholly Owned Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (yCompany) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released within one year from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash;
(B) second, to the Parent or its Restricted Subsidiaries may use extent of the balance of such Net Available Cash toafter application in accordance with clause (A), to the extent the Company elects, to acquire Additional Assets within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B), to make an Offer to the holders of the Securities (and to holders of other Senior Indebtedness of the Company designated by the Company) to purchase Securities (and such other Senior Indebtedness of the Company) pursuant to and subject to the conditions of this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 4.06, the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 4.06(a) except to the extent that the aggregate Net Available Cash from all Asset Dispositions which is not applied in accordance with this Section 4.06(a) exceeds $20 million. Pending application of Net Available Cash pursuant to this Section 4.06(a), such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily reduce revolving credit indebtedness. For the purposes of this Section 4.06(a), the following are deemed to be cash or cash equivalents:
(i1) the assumption of Indebtedness of the Company (aother than obligations in respect of Disqualified Stock of the Company) prepayor any Restricted Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition; and
(2) securities received by the Company or any Restricted Subsidiary from the transferee that are promptly converted by the Company or such Restricted Subsidiary into cash, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); to the extent of cash received in that conversion.
(b) unless included in In the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for event of an Asset Disposition Offer, in such an amount as would reduce that requires the aggregate principal amount purchase of Notes then outstanding in the same proportion as the aggregate principal amount of such Securities (and other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Senior Indebtedness of the Issuer or a Guarantor or Indebtedness owed Company) pursuant to Section 4.06(a)(3)(C), the Parent or any Restricted Subsidiary);
(ii) Company shall purchase any series of Notes Securities tendered pursuant to an offer to all Holders by the Company for the Securities (and such other Senior Indebtedness) (the "Offer") at a purchase price of 100% of their principal amount (or, in the event such other Senior Indebtedness was issued with significant original issue discount, 100% of the accreted value thereof), without premium, plus accrued but unpaid interest (or, in respect of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders other Senior Indebtedness of the Notes (Company, such lesser price, if any, as may be provided for by the terms of such Senior 66 Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set out belowforth in Section 4.06(c);
. If the aggregate purchase price of Securities (iii) invest in and any Replacement Assets;
(iv) acquire all or substantially all other Senior Indebtedness of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(vCompany) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply tendered exceeds the Net Available Cash allotted to their purchase, the Company shall select the Securities and other Senior Indebtedness to be purchased on a pro rata basis but in round denominations, which in the case of the Securities will be denominations of $1,000 principal amount or multiples thereof. The Company shall not be required to make such an Offer to purchase Securities (and other Senior Indebtedness of the Company) pursuant to this Section 4.05(b)(i4.06 if the Net Available Cash available therefor is less than $20 million (which lesser amount shall be carried forward for purposes of determining whether such an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition). Upon completion of such an offer to purchase, Net Available Cash shall be deemed to be reduced by the aggregate amount of such offer.
(1) Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as described in Section 4.06(b) in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days from the date such notice is mailed (the "Purchase Date") and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), Section 4.05(b)(iii(B) a description of material developments in the Company's business subsequent to the date of the latest of such Reports, and (C) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to the Offer, together with the information contained in clause (3).
(2) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided below, the Company shall deliver to the Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer Amount"), Section 4.05(b)(iv)including information as to any other Senior Indebtedness included in the Offer, Section 4.05(b)(v(B) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application the allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (C) the compliance of such commitment until allocation with the earlier provisions of (xSection 4.06(a) the date on which such investment is consummated, and (yb). On such date, the Company shall also 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, maturing on the 180th last day following prior to the Purchase Date or on the Purchase Date if funds are immediately available by open of business, an amount equal to the Offer Amount to be held for payment in accordance with the provisions of this Section. If the Offer includes other Senior Indebtedness, the deposit described in the preceding sentence may be made with any other paying agent pursuant to arrangements satisfactory to the Trustee. Upon the expiration of the aforementioned 360-day periodperiod for which the Offer remains open (the "Offer Period"), if the investment has not Company shall deliver to the Trustee for cancellation the Securities or portions thereof which have been consummated properly tendered to and are to be accepted by the Company. The Trustee shall, on the Purchase Date, mail or deliver payment (or cause the delivery of payment) to each tendering Holder in the amount of the purchase price. In the event that datethe aggregate purchase price of the Securities (and other Senior Indebtedness of the Company) delivered by the Company to the Trustee is less than the Offer Amount applicable to the Securities, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(c3) The Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a 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 and a statement that such Net Available Cash not so used as set forth above constitutes “Excess ProceedsHolder is withdrawing his election to have such Security purchased. Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.” Pending
(4) At the final application of any such Net Available Cashtime the Company delivers Securities to the Trustee which are to be accepted for purchase, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize Company shall also deliver an Officers' Certificate stating that such Net Available Cash Securities are to be accepted by the Company pursuant to and in any manner that is not prohibited by accordance with the terms of this IndentureSection. A Security shall be deemed to have been accepted for purchase at the time the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer Company shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Section, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)securities laws or regulations.
Appears in 1 contract
Sources: Indenture (Citgo Petroleum Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Disposition, unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (as determined in good faith by an Officer of the Company) of the assets sold or otherwise disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors)of; and
(ii2) except in the case of a Permitted Asset Swap, at least 75% of the consideration therefor received by the Parent Company or such Restricted Subsidiary receives in respect Subsidiary, as the case may be (which, for purposes of this clause (b), consideration will not include any contingent payment obligations related to such Asset Disposition consists Disposition, including, earn-out payments, purchase price adjustments and deferred purchase price payments), is in the form of cash or Cash Equivalents; provided that the amount of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded (as shown on the Parent’s, the IssuerCompany’s or such other Restricted Subsidiary’s most recent balance sheet or in the footnotes thereto, or if Incurred or accrued subsequent to the date of such balance sheet, such liabilities that would have been shown on the Company’s or such Restricted Subsidiary’s balance sheet or in the notes footnotes thereto (or, if Incurred since such Incurrence or accrual had taken place on or prior to the date of the latest such balance sheet, that would be recorded on as determined in good faith by an Officer of the next balance sheetCompany) (of the Company or such Restricted Subsidiary, other than Subordinated Indebtedness)liabilities that are by their terms subordinated to the Notes and the Note Guarantees, as a result that are assumed by the transferee of any such assets and for which none the Company and all of its Restricted Subsidiaries have been validly released in writing;
(B) any securities or other obligations received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents (to the extent of the Parent, cash or Cash Equivalents received) within 180 days following the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result closing of such Asset Disposition;
(D) Replacement Assets;
(EC) any Capital Stock Stock, properties or assets of the kind referred to in clause (iv) or (vib) of Section 4.05(b);the following paragraph; and
(FD) consideration consisting cash held in escrow as security for any purchase price settlement, for damages in respect of Indebtedness a breach of the Issuer representations and warranties or any Guarantor received from Persons who are not the Parentcovenants or for payment of other contingent obligations in connection with such Asset Disposition, the Issuer or any shall be deemed to be Cash Equivalents for purposes of this provision and for no other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)purpose.
(b) If Within 365 days after the Parentreceipt of any Net Cash Proceeds of any Asset Disposition (the “Application Period”), the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (Company or such period as provided in clause (viii) belowRestricted Subsidiary, if applicable) of at its option, may apply the later of the date of consummation of Net Cash Proceeds from such Asset Disposition and receipt to one or more of such Net Available Cashthe following, the Parent or its Restricted Subsidiaries may use the Net Available Cash toany combination,
(1) to reduce or repay:
(iA) First-Priority Lien Obligations;
(aB) prepayObligations under Indebtedness (other than Subordinated Obligations) that is secured by a Lien, repaywhich Lien is permitted by this Indenture; or
(C) Indebtedness of a non-Guarantor Subsidiary, purchase other than Indebtedness owed to the Company or redeem another Restricted Subsidiary; or
(including through open market purchases, voluntary tender offers 2) to make (1) an Investment in any one or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtednessmore businesses; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or Investment in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding any business is in the same proportion as form of the aggregate principal amount acquisition of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness Capital Stock of a Restricted Subsidiary or results in the Company or another of its Restricted Subsidiaries owning an amount of the Parent Capital Stock of such business such that is not it constitutes a Guarantor Restricted Subsidiary, (2) capital expenditures or (3) acquisitions of other than properties or assets, in the Issuercase of each of (1), (2) and (3), used or any Indebtedness that is secured on assets that do not constitute Collateral useful in a Related Business; or
(3) to redeem Notes in each caseaccordance with Section 3.07 hereof, other than Subordinated Indebtedness to make open market purchases of the Issuer or a Guarantor or Indebtedness owed Notes (to the Parent extent such purchases are at or any Restricted Subsidiaryabove 100% of the principal amount thereof);
(ii) purchase any series of Notes pursuant , or to make an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the purchase Notes (in accordance with the procedures set out belowforth below for a Collateral Proceeds Offer or Asset Disposition Offer, as the case may be);
(iii) invest in any Replacement Assets;
(iv) acquire ; provided, that all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect Net Cash Proceeds used to any make such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment an offer to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment purchase shall be treated as a permitted application of deemed to have been so applied whether or not accepted by the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that dateHolders.
(c) The amount Any Net Cash Proceeds from an Asset Disposition of such Net Available Cash Collateral that are not so used invested or applied as provided and within the time period set forth above constitutes in the second paragraph of this covenant will be deemed to constitute “Collateral Excess Proceeds.” Pending The Issuers shall make an offer to all Holders of the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited Notes and if required by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders andany Other Pari Passu Lien Obligations, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is such Other Pari Passu IndebtednessLien Obligations (a “Collateral Proceeds Offer”), to purchase the maximum aggregate principal amount of the Notes and any such other Senior Indebtedness that is in an amount equal to at least $2,000, that may be purchased out of the Collateral Excess Proceeds, Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100100.0% of the principal amount thereof (or accreted value thereof, if less), plus accrued and unpaid interestinterest and Special Interest, if any, toor, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will such Other Pari Passu Lien Obligations, such lesser price, if any, as may be made provided for by the terms of such Other Pari Passu Lien Obligations, to the date fixed for the closing of such offer, in accordance with the procedures set forth in this Indenture. The Issuers will commence a Collateral Proceeds Offer with respect to Collateral Excess Proceeds within ten Business Days after the date that Collateral Excess Proceeds exceed $10.0 million by delivering the notice required pursuant to the terms of this Indenture, with a copy to the Trustee. The Issuers may, at their election, satisfy the foregoing obligations with respect to any Net Cash Proceeds from an Asset Disposition by making a Collateral Sale Offer with respect to such Net Cash Proceeds prior to the expiration of the relevant 365-day period (or such longer period provided above).
(d) To the extent that the aggregate amount of Notes and such Other Pari Passu Lien Obligations tendered pursuant to a Collateral Sale Offer is less than the Collateral Excess Proceeds, the Issuers may use any remaining Collateral Excess Proceeds for any purpose not prohibited by this Indenture. If the aggregate principal amount of Notes or such Other Pari Passu Lien Obligations surrendered by such holders thereof exceeds the amount of Collateral Excess Proceeds, the Trustee shall select the Notes and the Issuers shall select such Other Pari Passu Lien Obligations to be purchased on a pro rata basis based on the accreted value or principal amount of the Notes or such Other Pari Passu Lien Obligations tendered with adjustments as necessary so that no Notes or Other Pari Passu Lien Obligations will be repurchased in minimum denominations part in an unauthorized denomination. Upon completion of $200,000 and any such Collateral Sale Offer, the amount of Collateral Excess Proceeds that resulted in integral multiples of $1,000 in excess thereofthe Collateral Sale Offer shall be reset to zero.
(e) Any Net Cash Proceeds from an Asset Disposition of non-Collateral that are not invested or applied as provided and within the time period set forth in the second paragraph of this covenant will be deemed to constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $5.0 million, the Issuers shall make an offer to all Holders of the Notes and, if required by the terms of any Senior Indebtedness, to the Holders of such other Senior Indebtedness (an “Asset Disposition Offer”), to purchase the maximum aggregate principal amount of the Notes and such Senior Indebtedness that is in an amount equal to at least $2,000, that may be purchased out of the Excess Proceeds at an offer price in cash in an amount equal to 100.0% of the principal amount thereof (or accreted value thereof, if less), plus accrued and unpaid interest and Special Interest, if any, to the date fixed for the closing of such offer, in accordance with the procedures set forth in this Indenture. The Issuers will commence an Asset Disposition Offer with respect to Excess Proceeds within ten Business Days after the date that Excess Proceeds exceed $10.0 million by delivering the notice required pursuant to the terms of this Indenture, with a copy to the Trustee. The Issuers may satisfy the foregoing obligations with respect to any Net Cash Proceeds from an Asset Disposition of non-Collateral by making an Asset Disposition Offer with respect to such Net Cash Proceeds prior to the expiration of the relevant 365-day period (or such longer period provided above) or with respect to Excess Proceeds of $5.0 million or less.
(f) To the extent that the aggregate amount of Notes and such Senior Indebtedness tendered pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Issuers may use any remaining Excess Proceeds for any purpose not prohibited by this Indenture. If the aggregate principal amount of Notes or the Senior Indebtedness surrendered by such holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and the Issuers shall select the Senior Indebtedness to be purchased on a pro rata basis based on the accreted value or principal amount of the Notes or the Senior Indebtedness tendered with adjustments as necessary so that no Notes or Senior Indebtedness will be repurchased in part in an unauthorized denomination. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero zero.
(regardless g) Pending the final application of whether there are any remaining Collateral Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition OfferExcess Proceeds, any remaining Net Available Cash shall not be deemed the Company (or the applicable Restricted Subsidiary) may temporarily reduce revolving credit borrowings or otherwise invest the Collateral Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for or Excess Proceeds in any purpose manner that is not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer Issuers will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Notes pursuant to this Indenturean Asset Disposition Offer or Collateral Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.05Indenture, the Issuer Issuers will comply with the applicable securities laws and regulations and will shall not be deemed to have breached its their obligations under described in this Indenture by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (PRETIUM CANADA Co)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any sale, lease, transfer or other disposition (or series of related sales, leases, transfers or dispositions) by the Company or any Restricted Subsidiary, including any disposition by means of a merger, consolida tion or similar transaction (each referred to for the purposes of this definition as an "Asset Disposition unlessDisposition"), of:
(a) any shares of Capital Stock of a Restricted Subsidiary (other than directors' qualifying shares or shares required by applicable law to be held by a Person other than the Company or a Restricted Subsidiary);
(b) all or substantially all the assets of any division or line of business of the Company or any Restricted Subsidiary;
(c) any other assets of the Company or any Restricted Subsidiary outside of the ordinary course of business of the Company or such Restricted Subsidiary;
(d) any Investment in a Strategic Alliance Client; or
(e) any Excess Spread Receivables; other than, in the case of (a), (b), (c), (d) and (e), above, (i) the consideration the Parent, the Issuer or such other an Asset Disposition by a Restricted Subsidiary receives for such Asset Disposition is not less than to the fair market value of Company or by the assets disposed of as of the date of entry into binding documentation in respect of such Company or a Restricted Subsidiary to a Restricted Subsidiary or (ii) an Asset Disposition (as determined by including related assets) for an aggregate consideration of $1,000,000 or less, unless (A) the Parent’s Board of Directors); and
(ii) at least 75% of the consideration the Parent Company or such Restricted Subsidiary receives in respect consideration at the time of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred at least equal to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value (including the value of each issue all non-cash consideration), as determined in good faith by the Board of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination Directors, of the types shares and assets subject to such Asset Disposition and at least 85% of the consideration specified therefor received by the Company or such Restricted Subsidiary is in the preceding clauses form of cash or cash equivalents, and (ii)(AB) through (ii)(G).
(b) If an amount equal to 100% of the Parent, Net Available Cash from such Asset Disposition is applied by the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days Company (or such period Restricted Subsidiary, as provided in clause the case may be) (viiix) belowto the extent the Company elects, if applicable) of to acquire Additional Assets, either directly or through a Restricted Subsidiary, within 180 days from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash, and (y) to the Parent or its Restricted Subsidiaries may use extent of the balance of such Net Available Cash to:
after application in accordance with clause (i) x), to permanently reduce the Commitments (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included as defined in the preceding clause (i)(a)Credit Agreement) in accordance with Section 2.07 of the Credit Agreement and to make any prepayments required by such Section in connection with such reduction pursuant to the Credit Agreement. Notwithstanding the foregoing provisions of this Section, prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, Company and its the Restricted Subsidiaries shall not be entitled required to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or apply any Net Available Cash in compliance accor dance with this covenant) an offer Section except to Holders to purchase Notes, the extent that the aggregate Net Available Cash from all Asset Dispositions which has not been applied in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount this paragraph exceeds $10,000,000. Pending application of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i)this Section, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used shall be applied (i) to prepay outstanding Loans under and as set forth above constitutes “Excess Proceeds.” Pending defined in the final application Credit Agreement and (ii) to the extent of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such excess of Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating over the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent outstanding Loans (as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds defined in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”Credit Agreement), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition OfferPermitted Investments.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Letter of Credit and Reimbursement Agreement (Contifinancial Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition is not less than at least equal to the fair market value of the shares and assets disposed subject to such Asset Disposition, as such fair market value may be determined (and shall be determined, to the extent such Asset Disposition or any series of related Asset Dispositions involves aggregate consideration in excess of $10,000,000) in good faith by the Board of Directors, whose determination shall be conclusive (including as to the value of all non-cash consideration);
(ii) in the case of any Asset Disposition (or series of related Asset Dispositions) having a fair market value of $10,000,000 or more, at least seventy-five percent (75%) of the consideration therefor (excluding, in the case of an Asset Disposition (or series of related Asset Dispositions) of assets, any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise, that are not Indebtedness) received by the Company or such Restricted Subsidiary is in the form of cash, and provided that this clause (ii) shall not apply to any Asset Disposition (or series of related Asset Dispositions), involving assets that accounted for less than two percent (2%) of Consolidated EBITDA during the period of the most recent four (4) consecutive fiscal quarters ending prior to the date of entry into binding documentation in respect of such Asset Disposition (as determined by for which consolidated financial statements of the Parent’s Board of Directors)Company are available; and
(iiiii) at least 75% an amount equal to one-hundred percent (100%) of the consideration the Parent or such Restricted Subsidiary receives in respect of Net Available Cash from such Asset Disposition consists ofis applied by the Company (or any Restricted Subsidiary, as the case may be) as follows:
(A) cash first, either (including 1) to the extent the Company elects (or is required by the provisions of this Agreement or the terms of the Credit Agreement or of Indebtedness of a Restricted Subsidiary that is not a Note Guarantor of any Net Cash Proceeds received from of the conversion Notes), to prepay, repay or purchase the Notes, the Fund VI Notes, the Bank Indebtedness under the Credit Agreement or such Indebtedness of a Restricted Subsidiary (in each case other than Indebtedness owed to the Company or a Restricted Subsidiary) within 180 365 days after the date of such Asset Disposition or (2) to the extent the Company or such Restricted Subsidiary elects, to reinvest in Additional Assets (including by means of securities, notes an investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or other obligations received in consideration another Restricted Subsidiary) within 365 days from the date of such Asset Disposition), or, if such reinvestment in Additional Assets is a project that is authorized by the Board of Directors that will take longer than such 365 days to complete, the period of time necessary to complete such project;
(B) second, to the extent of the balance of such Net Available Cash Equivalents;after application in accordance with clause (A) above, to make an offer to purchase the Notes pursuant and subject to the conditions of this Section 8.4; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B) above, to fund (to the extent consistent with any other applicable provision of this Agreement) any general corporate purpose (including but not limited to the repurchase, repayment or other acquisition or retirement of any Subordinated Obligations to the extent otherwise permitted hereby); provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A)(1) or (B) above, the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased.
(b) Notwithstanding the foregoing provisions of this Section 8.4, the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 8.4 except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 8.4 exceeds $15,000,000, it being understood that lesser amounts of Net Available Cash shall be carried forward for future application in accordance with this Section 8.4.
(c) For the purposes of clause (ii) of the first paragraph of this Section 8.4, the following are deemed to be cash: (i) Temporary Cash Investments and Cash Equivalents, (ii) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company (other than Subordinated Indebtedness), as a result of which none Disqualified Stock of the Parent, the Issuer Company) or any Restricted Subsidiary and the release of the other Company or such Restricted Subsidiaries remains obligated in respect Subsidiary from all liability on payment of the principal amount of such liabilitiesIndebtedness in connection with such Asset Disposition, or (yiii) Indebtedness of a any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if to the Parent, extent that the Issuer Company and every each other Restricted Subsidiary is are released from any guarantee Guarantee of payment of the principal amount of such Indebtedness as a result of in connection with such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause , (iv) securities received by the Company or any Restricted Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary into cash and (vi) of Section 4.05(b);
(Fv) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On In the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount event of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and that requires the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To clause (iii)(B) of the extent that the provisions of any securities laws or regulations conflict with provisions first paragraph of this Section 4.058.4, the Issuer Company will comply with be required to purchase Notes tendered pursuant to an offer by the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, Company for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).the
Appears in 1 contract
Sources: Investment Agreement (Acterna Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition Sale unless:
(i1) the Company or such Restricted Subsidiary (x) receives consideration at the time of such Asset Sale at least equal to the Fair Market Value of the assets subject to such Asset Sale (which Fair Market Value shall be determined by the Board of Directors for any transaction (or series of transactions) involving consideration in excess of $15,000,000) and (y) the consideration the Parentreceived consists of cash, Cash Equivalents or other non-cash consideration, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition Fair Market Value of which and basis of valuation is not less than the fair market value of the assets disposed of as of the date of entry into binding documentation set forth in respect of such Asset Disposition (as determined by the Parent’s Board of Directors)an Officer's Certificate; and
(ii) PROVIDED, HOWEVER, if at least 75% of the consideration received by the Parent Company or such Restricted Subsidiary receives in respect connection with an Asset Sale is in the form of cash or Cash Equivalents, no such Asset Disposition consists of:
(A) cash (including Officer's Certificate shall be required; and PROVIDED FURTHER, HOWEVER, that any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser Company or a Restricted Subsidiary from such transfers that are converted within 90 days of (x) any liabilities recorded on receipt thereof by the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet Subsidiary into cash or Cash Equivalents (to the notes thereto (orextent so received), if Incurred since shall be deemed to be cash or Cash Equivalents for purposes of this provision AND that the date amount of any Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or such Restricted Subsidiary (other than Subordinated Indebtedness)Obligations) that is actually assumed by the transferee in such Asset Sale and from which the Company or such Restricted Subsidiary is fully and unconditionally released shall be deemed to be cash for purposes of determining the percentage of cash consideration received by the Company or such Restricted Subsidiary;
(2) an amount equal to 100% of the Net Available Cash from such Asset Sale is applied by the Company (or such Restricted Subsidiary, as a result of which none of the Parent, case may be) at its election within 270 days from the Issuer or any of the other Restricted Subsidiaries remains obligated in respect date of such liabilitiesAsset Sale:
(A) to prepay or repay Senior Indebtedness and permanently reduce the commitments, if any, with respect thereto; or
(i) to make an investment in properties or assets that replace the properties or assets that were the subject of such Asset Sale or in properties or assets that will be used in a Related Business or (yii) Indebtedness to acquire the Capital Stock of a Restricted Subsidiary Person that is no longer becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock; PROVIDED that such Person is, at the time it becomes a Restricted Subsidiary, engaged in a Related Business; PROVIDED FURTHER that, in the case of items (i) and (ii), the Company may elect to deem such an investment or acquisition made within 180 days prior to such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released Sale to have been made with Net Available Cash resulting from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock Sale. In determining whether an investment or assets acquisition of the kind type referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness above was made within the applicable time limits, such investment or acquisition shall be deemed to have been made, at the election of the Issuer Company, either on the date the Company or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant actually made the investment or acquisition OR the date the Company or Restricted Subsidiary executed a binding commitment to this covenant that is at any one time outstanding, not to exceed consummate such investment or acquisition and the greater closing of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination such investment or acquisition occurs within 90 days of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)date such commitment is executed.
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period Any Net Available Cash not applied as provided in clause (viii) below, if applicable2) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) paragraph (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall above will be entitled deemed to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “"Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if ". When the aggregate amount of Excess Proceeds exceeds $60 10 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and(an "Asset Sale Offer") to purchase, to on a pro rata basis, the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of equal in amount to the Excess ProceedsProceeds (and not just the amount thereof that exceeds $10 million) (the "Asset Sale Offer Amount"), at a purchase price in cash in an offer price, in respect of the Notes, amount equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, interest thereon to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made each Holder of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date), in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.accordance with the following standards:
(e1) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate principal amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer surrendered by Holders thereof exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee shall select the Notes to be purchased on a pro rata basis, based on the principal amount of Notes tendered, with such adjustments as may be deemed appropriate by the Trustee, so that only Notes in denominations of $1.00 or integral multiples thereof shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on purchased.
(2) If the aggregate principal amount of Notes and tendered pursuant to such other Senior Indebtedness so tendered and not properly withdrawn. For Asset Sale Offer is less than the purposes of calculating Excess Proceeds, the principal amount of Company may use any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by remaining Excess Proceeds following the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning completion of the Asset Disposition Sale Offer Periodfor general corporate purposes (subject to the other provisions of this Indenture). Upon completion of any an Asset Disposition Sale Offer, the amount of Excess Proceeds then required to be otherwise applied in accordance with this covenant shall be reset to zero, subject to any subsequent Asset Sale.
(c) In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01 below, the successor shall be deemed to have sold the properties and assets of the Company and its Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the Fair Market Value of such properties and assets of Company or its Subsidiaries deemed to be sold shall be deemed to be Net Available Cash for purposes of this covenant.
(d) If at zeroany time any non-cash consideration received by the Company or any Subsidiary in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash, then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Available Cash thereof shall be applied in accordance with this covenant.
(e) Each Asset Sale Offer will be mailed to the record Holders as shown on the register of Holders within 30 days following the date the amount of Excess Proceeds exceeded $10 million, with a copy to the Trustee, and shall comply with the procedures set forth herein. Upon receiving notice of the Asset Sale Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1.00 in exchange for cash. To the extent Holders of Notes and holders of other Senior Subordinated Indebtedness, if any, which are or is the subject of an Asset Sale Offer properly tender Notes or such other Senior Subordinated Indebtedness in an aggregate amount exceeding the amount of unapplied Excess Proceeds, Notes of tendering Holders and such other Senior Subordinated Indebtedness of tendering holders will be purchased on a PRO RATA basis (based on amounts tendered).
(f) To Upon surrender and cancellation of a Certificated Note that is purchased in part, the extent that any Company shall promptly issue and the Trustee shall authenticate and deliver to the surrendering Holder of such Certificated Note, a new Certificated Note equal in principal amount to the unpurchased portion of Net Available Cash payable in respect of the Notes is denominated such surrendered Certificated Note; PROVIDED that each such new Certificated Note shall be in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net principal amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency$1.00 or an integral multiple thereof.
(g) The Asset Disposition OfferUpon surrender of a Global Note that is purchased in part, insofar as it relates the Paying Agent shall forward such Global Note to the Notes, will remain open for Trustee who shall make a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase notation on Schedule A thereof to reduce the principal amount of Notes andsuch Global Note, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”as provided in Section 2.05(c) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offerhereof.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.11. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Section, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 4.11 by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Paragon Trade Brands Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a1) The Parent will Issuer shall not, and will shall not permit the Issuer or any other Restricted of its Subsidiary to, consummate Guarantors to make any Asset Disposition Sale of Collateral unless:
(ia) the consideration the Parent, the Issuer or such other Restricted Subsidiary Guarantor, as the case may be, receives for such Asset Disposition is not less than consideration at least equal to the fair market value of the assets disposed of as of (such fair market value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition Sale) of the shares and assets subject to such Asset Sale;
(as b) in the case of Asset Sales involving consideration in excess of $5.0 million, the fair market value is determined in good faith by the Parent’s Board of DirectorsDirectors (including as to the value of all non-cash consideration); and;
(iic) at least 75% of the consideration the Parent or such Restricted Subsidiary receives in respect of from such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds Sale received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable such Subsidiary Guarantor, as the case may be, is in the form of cash or Cash Equivalents; and
(d) the remaining consideration (other than Excluded Assets) from such Asset Sale that is not in the form of cash or Cash Equivalents is substantially simultaneously with its acquisition pledged under the Collateral Documents, with the Lien on such Collateral securing the Notes being of the same priority with respect to the Notes as the Lien on the assets disposed of. Subject to the terms of the Intercreditor Agreement and any Credit Agreement Obligation, an amount equal to 100% of the Net Available Cash from any Asset Sales of Collateral or Recovery Event shall, within 365 days from the later of (i) the date of such Asset Sale or Recovery Event and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, at the Parent Issuer’s election, (a) be used by the Issuer or a Subsidiary Guarantor to invest in Additional Assets (which may include performance of a restoration of the affected Collateral in the event of a Recovery Event), which Additional Assets are substantially simultaneously with their acquisition pledged under the Collateral Documents (or, in the case of real property, mortgaged as and when required by Section 10.05), with the Lien on such Collateral securing the Notes being of the same priority with respect to the Notes as the Lien on the assets disposed of, (b) be used to permanently prepay or permanently repay any Indebtedness constituting Credit Agreement Obligations or other First Priority Lien Obligations or (c) be applied toward an Asset Sale Offer as Excess Proceeds (as defined and as provided below); provided, however, that if the Issuer or any Subsidiary Guarantor completes an Asset Sale of Collateral (other than any Current Premises) constituting a Sale/Leaseback Transaction within 270 days from initiating the investment in the property subject to such Sale/Leaseback Transaction (the total amount of such investment in such property during such 270 day period shall be referred to as the “Initial Investment”), the Issuer shall only be required to, within 365 days of such Sale/Leaseback Transaction, apply an amount of Designated Sale/Leaseback Consideration received from such Sale/Leaseback Transaction equal to (A) the Net Available Cash from such Sale/Leaseback Transaction minus (B) an amount equal to the Initial Investment in accordance with clauses (a), (b) or (c) above. In the case of any application of Net Available Cash or Designated Sale/Leaseback Consideration pursuant to clause (a) of the preceding paragraph, a binding commitment shall be treated as a permitted application of the Net Available Cash or Designated Sale/Leaseback Consideration, as the case may be, from the date of such commitment so long as the Issuer or the applicable Subsidiary Guarantor enters into such commitment (a “Collateral Acceptable Commitment”) with the good faith expectation that such Net Available Cash or Designated Sale/Leaseback Consideration, as the case may be, will be applied to satisfy such commitment within 180 days of such commitment and, in the event any Collateral Acceptable Commitment is later cancelled or terminated for any reason before the Net Available Cash or Designated Sale/Leaseback Consideration, as the case may be, is applied in connection therewith, the Issuer or such Subsidiary Guarantor enters into another Collateral Acceptable Commitment (a “Collateral Second Commitment”) within 90 days of such cancellation or termination and with the good faith expectation that such Net Available Cash or Designated Sale/Leaseback Consideration, as the case may be, will be applied within 180 days of such Collateral Second Commitment, it being understood that if a Collateral Second Commitment is later cancelled or terminated for any reason before such Net Available Cash or Designated Sale/Leaseback Consideration, as the case may be, is applied, then such Net Available Cash or Designated Sale/Leaseback Consideration, as the case may be, shall constitute (and be applied as) Excess Proceeds. Pending the final application of any such Net Available Cash in accordance with this Section 4.10(1), the Issuer and its Restricted Subsidiaries may use temporarily reduce Indebtedness or otherwise invest such Net Available Cash in any manner not prohibited by this Indenture, the Collateral Documents or any Credit Agreement Obligation.
(2) The Issuer will not, and will not permit any of its Restricted Subsidiaries to, make any Asset Sale of assets or property not constituting Collateral unless:
(a) the Issuer or such Restricted Subsidiary, as the case may be, receives consideration at least equal to the fair market value (such fair market value to be determined on the date of contractually agreeing to such Asset Sale), of the shares and assets subject to such Asset Sale;
(b) in the case of Asset Sales involving consideration in excess of $5.0 million, the fair market value is determined in good faith by the Board of Directors (including as to the value of all non-cash consideration);
(c) at least 75% of the consideration from such Asset Sale received by the Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(d) an amount equal to 100% of the Net Available Cash tofrom such Asset Sale is applied by the Issuer or such Restricted Subsidiary, as the case may be, within 365 days from the later of the date of such Asset Sale and the receipt of such Net Available Cash, as follows:
(iA) to permanently reduce (aand permanently reduce commitments with respect thereto) prepay, repay, purchase Credit Agreement Obligations or redeem other First Priority Lien Obligations;
(including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricesB) any Senior to permanently reduce obligations under other Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or of the Issuer makes (at such time other than any Disqualified Stock or in compliance with this covenantSubordinated Obligations) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuerany Disqualified Stock or Guarantor Subordinated Obligations) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, case other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Issuer or any Restricted Subsidiaryan Affiliate of the Issuer);
(ii) purchase any series of ; provided that the Issuer shall equally and ratably reduce obligations under the Notes pursuant to an offer to all Holders of such series of Notes, redeem (including as provided under Section 3.07 through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture purchases or by making an Asset Disposition Offer to all Holders of the Notes offer (in accordance with the procedures set out below)forth below for an Asset Sale Offer) to all Holders to purchase their Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of Notes that would otherwise be prepaid;
(iiiC) to invest in Additional Assets; provided that, to the extent such Additional Assets are of the type that would constitute Collateral under the Collateral Documents, such Additional Assets are concurrently added to the Collateral securing the Notes and the Note Guarantees in the manner and to the extent required in this Indenture or any Replacement Assetsof the Collateral Documents;
(ivD) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect applied as Excess Proceeds to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;make an Asset Sale Offer (as defined and as provided below); or
(vE) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
. In the case of clause (viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(iC), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until so long as the earlier of (x) Issuer or such other Restricted Subsidiary enters into such commitment with the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by good faith expectation that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”) and, in the event any Acceptable Commitment is later cancelled or terminated for any reason before the Net Available Cash is applied in connection therewith, the Issuer or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 90 days of such cancellation or termination and with the good faith expectation that such Net Available Cash will be applied within 180 days of such Second Commitment, it being understood that if a Second Commitment is later cancelled or terminated for any reason before such Net Available Cash is applied, then such Net Available Cash shall constitute Excess Proceeds.” . Pending the final application of any such Net Available CashCash in accordance with clause (A), (B), (C), (D) or (E) above, the Parent or any Issuer and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner not prohibited by this Indenture, the Collateral Documents or any Credit Agreement Obligation.
(3) For the purposes of clauses (1)(c) and (2)(c) above and for no other purpose, the following will be deemed to be cash:
(a) any liabilities (as shown on the Issuer’s or such Restricted Subsidiary’s most recent balance sheet) of the Issuer or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes or the Note Guarantees) that are assumed by the transferee of any such assets and from which the Issuer and all Restricted Subsidiaries have been validly released;
(b) any securities, notes or other obligations received by the Issuer or any Restricted Subsidiary from the transferee that are converted by the Issuer or such Restricted Subsidiary into cash (to the extent of the cash received) within 180 days following the closing of such Asset Sale; and
(c) Designated Non-cash Consideration received by the Issuer or any of its Restricted Subsidiaries in such Asset Sale having an aggregate fair market value (as determined in good faith by the Issuer), taken together with all other Designated Non-cash Consideration received pursuant to this clause (3) that is at that time outstanding not to exceed an amount equal to the greater of (x) $5.0 million and (y) 3.0% of Consolidated Net Tangible Assets at the time of the receipt of such Designated Non-cash Consideration (with the fair market value of each item of Designated Non-cash Consideration being measured at the time received without giving effect to subsequent change in value).
(4) Any Net Available Cash from Asset Sales (including Asset Sales of Collateral) or Recovery Events that is not prohibited by applied or invested as provided in the terms preceding subsections (1) and (2) of this IndentureSection 4.10 or in accordance with the Collateral Documents will be deemed to constitute “Excess Proceeds.
(d) ” On or before the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset DispositionSale or Recovery Event, or such earlier time as the Issuer electsmay be extended as described above, if the aggregate amount of Excess Proceeds exceeds $60 20.0 million, the Issuer will be required within twenty (20) Business Days thereof to shall make an offer (“Asset Disposition Sale Offer”) in accordance with the procedures set forth in Section 3.09 to all Holders and, of Notes and to the extent required by the Issuer electsterms of other Pari Passu Lien Obligations, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu IndebtednessLien Obligations outstanding with similar provisions requiring the Issuer to make an offer to purchase such Pari Passu Lien Obligations with the proceeds from any Asset Sale or Recovery Event (“Pari Passu Notes”), to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Sale Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this IndentureIndenture or the agreements governing the Pari Passu Notes, as applicable, in minimum each case in denominations of $200,000 2,000 and in integral multiples of $1,000 1.00 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, . To the amount of Excess Proceeds extent that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness Pari Passu Notes so validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer is less than the Excess Proceeds, the Issuer may use any remaining Excess Proceeds for general corporate purposes, subject to other covenants contained in this Indenture. If the aggregate principal amount of Notes surrendered by Holders thereof and other Pari Passu Notes surrendered by Holders or lenders, collectively, exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness Pari Passu Notes to be purchased on a pro rata based basis on the basis of the aggregate principal amount of tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Sale Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Senior Secured Notes Indenture (Lri Holdings, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company and QS Wholesale shall not, and will the Company shall not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
: (i1) the consideration the ParentCompany, the Issuer QS Wholesale or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value of the assets disposed of as of (such fair market value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (Disposition), as determined in good faith by the Parent’s Board Company (including as to the value of Directorsall non-cash consideration), of the shares and assets subject to such Asset Disposition; and
(ii2) except in the case of Permitted Asset Swaps, at least 75% of the consideration from such Asset Disposition received by the Parent Company, QS Wholesale or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of cash or Cash Equivalents; (3) if such Asset Disposition consists of:
involves the disposition of Notes Priority Collateral, an amount equal to the Net Available Cash thereof in excess of $10,000,000 attributable to Notes Priority Collateral (Ain the good faith determination of the Company as described in paragraph (g) of this Section 3.7) shall be deposited with the Collateral Agent for deposit into the Notes Loan Priority Account pending application in accordance with the provisions described below, and, if any property other than cash or Cash Equivalents is included in such Net Available Cash attributable to Notes Priority Collateral (including any in the good faith determination of the Company as described in paragraph (g) of this Section 3.7), substantially all of such assets shall be made subject to the Note Liens; and (4) an amount equal to 100% of the Net Available Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption is applied by the purchaser Company, QS Wholesale or such Restricted Subsidiary, as the case may be, at the option of the Company, QS Wholesale or such Restricted Subsidiary, as the case may be: (a) to the extent such Net Available Cash constitutes proceeds from an Asset Disposition of (x) any liabilities recorded on ABL Priority Collateral or assets that are not Collateral, to prepay, repay or purchase Indebtedness under the Parent’s, ABL Credit Facility as required by the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, terms thereof or (y) assets of a Restricted Subsidiary that is not a Subsidiary Guarantor, to prepay, repay or purchase Indebtedness of a Restricted Subsidiary that is no longer not a Restricted Subsidiary Guarantor as a result of such Asset Disposition, if required by the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee terms of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness in each case of clauses (ix) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in valuey); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 365 days (or such period as provided in clause (viii) below, if applicable) of from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Parent Company, QS Wholesale or its such Restricted Subsidiaries may use Subsidiary shall retire such Indebtedness and shall cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (b) to repay or purchase Notes or Permitted Additional Pari Passu Obligations at a price equal to or higher than 100% of the principal amount thereof within 365 days from the later of the date of such Asset Disposition or the receipt of such Net Available Cash to:
Cash; provided, that if an Issuer or any Restricted Subsidiary shall so repay Permitted Additional Pari Passu Obligations, the Issuers will reduce (ior, as applicable, offer to purchase) obligations under the Notes on a pro rata basis by, at its option, (aA) prepayredeeming Notes pursuant to Section 5.1, repay, purchase or redeem (including B) purchasing Notes through open market purchases, voluntary tender offers at a price as a percentage of the principal amount thereof equal to or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in higher than the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any price paid for such Permitted Additional Pari Passu Indebtedness; provided Obligations, in a manner that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance complies with this covenantIndenture and applicable securities law or (C) making an offer to Holders to purchase Notes, (in accordance with the provisions procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon; (c) to acquire Additional Assets or make capital expenditures within 365 days from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; provided that, to the extent such Net Available Cash is received in respect of Notes Priority Collateral (other than Non-Core Asset Proceeds), such Net Available Cash is applied to acquire assets substantially all of which constitute Notes Priority Collateral or such capital expenditures relate to Notes Priority Collateral; provided, further that, in case of the acquisition of Additional Assets, such an amount as would reduce Additional Assets are thereupon pledged to the aggregate principal amount of Notes then outstanding extent required by the Security Documents (subject to the exclusions and exceptions therein) and otherwise in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptionscompliance with Section 3.19; or (cd) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that to do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending pending the final application of any such Net Available CashCash (other than Trust Monies) in accordance with clause (a), (b), (c) or (d) above, the Parent or any Company, QS Wholesale and the Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture; provided further that the Company and QS Wholesale will be deemed to have complied with the provision described in clause (c) above if, and to the extent that, within 365 days after the Asset Disposition that generated the Net Available Cash, the Company, QS Wholesale or any Restricted Subsidiary has entered into and not abandoned or rejected a binding agreement to acquire Additional Assets or make such capital expenditures, and that acquisition is thereafter completed or the capital expenditures thereafter made within 180 days after the end of such 365-day period.
(db) Any Net Available Cash from Asset Dispositions that are not applied or invested as provided in paragraph (a) of this Section 3.7 shall be deemed to constitute “Excess Proceeds.” On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time as extended pursuant to the Issuer electsproviso in paragraph (a) of this Section 3.7), if the aggregate amount of Excess Proceeds exceeds $60 million25,000,000 (or its equivalent in another currency), the Issuer will Issuers (with respect to the Notes) and the Company, QS Wholesale or Boardriders, as the case may be (with respect to any Permitted Additional Pari Passu Notes or any Other Pari Passu Notes (each as defined below), as required by such Permitted Additional Pari Passu Notes or Other Pari Passu Notes, as the case may be) shall be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders andand (x) in the case of Net Available Cash from an Asset Disposition of Notes Priority Collateral, to the extent required by the Issuer electsterms of other Permitted Additional Pari Passu Obligations, to all or some holders of other Permitted Additional Pari Passu Obligations outstanding Senior Indebtedness with similar provisions requiring the Company or QS Wholesale, as the case may be, to make an offer to purchase such Permitted Additional Pari Passu Obligations with the proceeds from any Asset Disposition (“Permitted Additional Pari Passu Notes”), to purchase the maximum principal amount of the Notes and any such Permitted Additional Pari Passu Notes to which the Asset Disposition Offer applies that is may be purchased out of the Excess Proceeds or (y) in the case of any other Net Available Cash, to the extent required by the terms of other Pari Passu Indebtedness, to all holders of other Pari Passu Indebtedness outstanding with similar provisions requiring the Company, QS Wholesale or Boardriders, as the case may be, to make an offer to purchase such Pari Passu Indebtedness with the proceeds from any Asset Disposition (“Other Pari Passu Notes” and, together with the Permitted Additional Pari Passu Notes, the “Pari Passu Notes”), to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an . The offer priceprice shall, in respect of the Noteseach case, be cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, interest to but not including, including the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this IndentureIndenture or the agreements governing the Pari Passu Notes, as applicable, in each case, in minimum denominations of $200,000 2,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, . To the amount of Excess Proceeds extent that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness Pari Passu Notes so validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds for general corporate purposes, subject to the other covenants contained in this Indenture. If the aggregate principal amount of Notes surrendered by Holders thereof and other Pari Passu Notes surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness the Pari Passu Notes will be purchased on a pro rata basis based on the aggregate principal amount of tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at to zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) . The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries Issuers may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 365 days (or such longer period provided above) or with respect to Excess Proceeds of $25,000,000 or less.
(c) The Asset Disposition Offer shall remain open for a period of 20 Business Days following its commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuers shall purchase the principal amount of Notes and the Company, QS Wholesale or Boardriders, as the case may be, will purchase the principal amount of Pari Passu Notes required to be purchased pursuant to this Section 3.7 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Pari Passu Notes validly tendered in response to the Asset Disposition Offer.
(d) If the Asset Disposition Purchase Date is on or part after an interest record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Asset Disposition Offer.
(e) On or before the Asset Disposition Purchase Date, the Company, QS Wholesale or Boardriders, as the case may be, shall, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in each case, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. The Company shall deliver to the Trustee an Officer’s Certificate stating that such Notes or portions thereof were accepted for payment by the Issuers in accordance with the terms of this Section 3.7 and, in addition, the Company, QS Wholesale or Boardriders, as the case may be, shall deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company, QS Wholesale, Boardriders or the Paying Agent, as the case may be, shall promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company, QS Wholesale or Boardriders, as the case may be, for purchase, and the Issuers shall promptly issue a new Note, and the Trustee, upon delivery of an Officer’s Certificate from the Company, shall authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note shall be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition, the Company, QS Wholesale or Boardriders, as the case may be, shall take any and all other actions, if any, required by the agreements governing the Pari Passu Notes. Any Note not so accepted shall be promptly mailed or delivered by the Issuers to the Holder thereof. The Issuers shall publicly announce the results of the Asset Disposition Offer on the Asset Disposition Purchase Date.
(f) For the purposes of this Section 3.7, the following shall be deemed to be cash: (x) the assumption by the transferee of Indebtedness (other than Subordinated Obligations or Disqualified Stock) of the Company or QS Wholesale or Indebtedness of a Wholly Owned Subsidiary (other than Guarantor Subordinated Obligations or Disqualified Stock of any Wholly Owned Subsidiary that is a Subsidiary Guarantor) and the release of the Company, QS Wholesale or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition (in which case the Issuers shall, without further action, be deemed to have applied such deemed cash to Indebtedness in accordance with clause (a) of this Section 3.7); (y) securities, notes or other obligations or assets received by the Company, QS Wholesale or any Restricted Subsidiary of the Company from the transferee that are converted by the Company, QS Wholesale or such Restricted Subsidiary into cash or Cash Equivalents within 180 days after receipt; and (z) any Designated Non-cash Consideration received by the Company, QS Wholesale or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market value (as determined in good faith by the Company), taken together with all other Designated Non-cash Consideration received pursuant to this clause (z) that is at that time outstanding, not to exceed the greater of (i) $25,000,000 and (ii) 2.0% of the Company’s Consolidated Tangible Assets at the time of receipt of such Designated Non-cash Consideration, with the fair market value of each item of Designated Non-cash Consideration being measured at the time received and without giving effect to subsequent changes in value.
(g) The Company shall determine in good faith whether, and to what extent, an Asset Disposition is in respect of Notes Priority Collateral and to what extent the Net Available Cash received from an Asset Disposition of Notes Priority Collateral are used to acquire or are invested in advance Notes Priority Collateral taking into account all relevant factors, including without limitation, the existence of being required structurally senior claims against the Notes Priority Collateral and the assets of an entity whose Capital Stock is subject to do so by this Indenturesuch Asset Disposition or acquired with such Net Available Cash.
(ih) The Issuer will Issuers shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 3.7. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.053.7, the Issuer will Issuers shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its their obligations under this Indenture by virtue of such complianceany conflict.
(ji) Except as otherwise provided in Section 9.01, For the provisions purposes of this Indenture relating Section 3.7, Holders electing to have a Note purchased shall be required to surrender the Note, with an appropriate form duly completed, to the Issuer’s obligation Issuers at the address specified in the notice at least three Business Days prior to make an Asset Disposition Offer may the purchase date. Each Holder shall be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, entitled to be considered effective withdraw its election if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard Issuers receive, not later than one Business Day prior to the level of consent obtained among Holders of each constituent series of Notes).purchase dat
Appears in 1 contract
Sources: Indenture (Quiksilver Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition Sale unless:
(i1) the Company or such Restricted Subsidiary (x) receives consideration at the time of such Asset Sale at least equal to the Fair Market Value of the assets subject to such Asset Sale (which Fair Market Value shall be determined by the Board of Directors for any transaction (or series of transactions) involving consideration in excess of $15,000,000) and (y) the consideration the Parentreceived consists of cash, Cash Equivalents or other non-cash consideration, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition Fair Market Value of which and basis of valuation is not less than the fair market value of the assets disposed of as of the date of entry into binding documentation set forth in respect of such Asset Disposition (as determined by the Parent’s Board of Directors)an Officer's Certificate; and
(ii) PROVIDED, HOWEVER, if at least 75% of the consideration received by the Parent Company or such Restricted Subsidiary receives in respect connection with an Asset Sale is in the form of cash or Cash Equivalents, no such Asset Disposition consists of:
(A) cash (including Officer's Certificate shall be required; and PROVIDED FURTHER, HOWEVER, that any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser Company or a Restricted Subsidiary from such transfers that are converted within 90 days of (x) any liabilities recorded on receipt thereof by the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet Subsidiary into cash or Cash Equivalents (to the notes thereto (orextent so received), if Incurred since shall be deemed to be cash or Cash Equivalents for purposes of this provision AND that the date amount of any Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or such Restricted Subsidiary (other than Subordinated Indebtedness)Obligations) that is actually assumed by the transferee in such Asset Sale and from which the Company or such Restricted Subsidiary is fully and unconditionally released shall be deemed to be cash for purposes of determining the percentage of cash consideration received by the Company or such Restricted Subsidiary;
(2) an amount equal to 100% of the Net Available Cash from such Asset Sale is applied by the Company (or such Restricted Subsidiary, as a result of which none of the Parent, case may be) at its election within 270 days from the Issuer or any of the other Restricted Subsidiaries remains obligated in respect date of such liabilitiesAsset Sale:
(A) to prepay or repay Senior Indebtedness and permanently reduce the commitments, if any, with respect thereto; or
(i) to make an investment in properties or assets that replace the properties or assets that were the subject of such Asset Sale or in properties or assets that will be used in a Related Business or (yii) Indebtedness to acquire the Capital Stock of a Restricted Subsidiary Person that is no longer becomes a Restricted Subsidiary as a result of the acquisition of such Capital Stock; PROVIDED that such Person is, at the time it becomes a Restricted Subsidiary, engaged in a Related Business; PROVIDED FURTHER that, in the case of items (i) and (ii), the Company may elect to deem such an investment or acquisition made within 180 days prior to such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released Sale to have been made with Net Available Cash resulting from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock Sale. In determining whether an investment or assets acquisition of the kind type referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness above was made within the applicable time limits, such investment or acquisition shall be deemed to have been made, at the election of the Issuer Company, either on the date the Company or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant actually made the investment or acquisition or the date the Company or Restricted Subsidiary executed a binding commitment to this covenant that is at any one time outstanding, not to exceed consummate such investment or acquisition and the greater closing of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination such investment or acquisition occurs within 90 days of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)date such commitment is executed.
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period Any Net Available Cash not applied as provided in clause (viii) below, if applicable2) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) paragraph (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall above will be entitled deemed to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “"Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if ". When the aggregate amount of Excess Proceeds exceeds $60 10 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and(an "Asset Sale Offer") to purchase, to on a pro rata basis, the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of equal in amount to the Excess ProceedsProceeds (and not just the amount thereof that exceeds $10 million) (the "Asset Sale Offer Amount"), at a purchase price in cash in an offer price, in respect of the Notes, amount equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, interest thereon to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made each Holder of record on the relevant Record Date to receive interest due on the relevant Interest Payment Date), in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.accordance with the following standards:
(e1) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate principal amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer surrendered by Holders thereof exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee shall select the Notes to be purchased on a pro rata basis, based on the principal amount of Notes tendered, with such adjustments as may be deemed appropriate by the Trustee, so that only Notes in denominations of $1.00 or integral multiples thereof shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on purchased.
(2) If the aggregate principal amount of Notes and tendered pursuant to such other Senior Indebtedness so tendered and not properly withdrawn. For Asset Sale Offer is less than the purposes of calculating Excess Proceeds, the principal amount of Company may use any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by remaining Excess Proceeds following the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning completion of the Asset Disposition Sale Offer Periodfor general corporate purposes (subject to the other provisions of this Indenture). Upon completion of any an Asset Disposition Sale Offer, the amount of Excess Proceeds then required to be otherwise applied in accordance with this covenant shall be reset to zero, subject to any subsequent Asset Sale.
(c) In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries as an entirety to a Person in a transaction permitted under Section 5.01 below, the successor shall be deemed to have sold the properties and assets of the Company and its Subsidiaries not so transferred for purposes of this covenant, and shall comply with the provisions of this covenant with respect to such deemed sale as if it were an Asset Sale. In addition, the Fair Market Value of such properties and assets of Company or its Subsidiaries deemed to be sold shall be deemed to be Net Available Cash for purposes of this covenant.
(d) If at zeroany time any non-cash consideration received by the Company or any Subsidiary in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash, then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Available Cash thereof shall be applied in accordance with this covenant.
(e) Each Asset Sale Offer will be mailed to the record Holders as shown on the register of Holders within 30 days following the date the amount of Excess Proceeds exceeded $10 million, with a copy to the Trustee, and shall comply with the procedures set forth herein. Upon receiving notice of the Asset Sale Offer, Holders may elect to tender their Notes in whole or in part in integral multiples of $1.00 in exchange for cash. To the extent Holders of Notes and holders of other Senior Subordinated Indebtedness, if any, which are or is the subject of an Asset Sale Offer properly tender Notes or such other Senior Subordinated Indebtedness in an aggregate amount exceeding the amount of unapplied Excess Proceeds, Notes of tendering Holders and such other Senior Subordinated Indebtedness of tendering holders will be purchased on a pro rata basis (based on amounts tendered).
(f) To Upon surrender and cancellation of a Certificated Note that is purchased in part, the extent that any Company shall promptly issue and the Trustee shall authenticate and deliver to the surrendering Holder of such Certificated Note, a new Certificated Note equal in principal amount to the unpurchased portion of Net Available Cash payable in respect of the Notes is denominated such surrendered Certificated Note; PROVIDED that each such new Certificated Note shall be in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net principal amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency$1.00 or an integral multiple thereof.
(g) The Asset Disposition OfferUpon surrender of a Global Note that is purchased in part, insofar as it relates the Paying Agent shall forward such Global Note to the Notes, will remain open for Trustee who shall make a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase notation on Schedule A thereof to reduce the principal amount of Notes andsuch Global Note, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”as provided in Section 2.05(c) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offerhereof.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.11. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Section, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 4.11 by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Paragon Trade Brands Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); andthe shares and assets subject to such Asset Disposition,
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in the form of cash, assets useful in a Permitted Business or Permitted Securities, or the assumption by the purchaser of liabilities of the Company or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Notes) as a result of which the Company and the Restricted Subsidiaries are no longer obligated with respect to those liabilities; provided that the amount of any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Disposition shall be deemed to be cash for the purposes of this provision (but for no other purpose) so long as such amount, taken together with the Fair Market Value when received of all other Designated Noncash Consideration that is at that time outstanding (i.e., that has not been sold for or otherwise converted into cash or Permitted Securities), does not exceed the greater of (i) $150,000,000 and (ii) 6% of Consolidated Tangible Assets as of the last day of the most recent fiscal quarter; provided, further, that (A) securities or other assets received by the Company or any Restricted Subsidiary from the transferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days after the closing of such Asset Disposition shall be considered to be cash to the extent of the cash received in that conversion; and (B) any cash consideration paid to the Company or the Restricted Subsidiary in connection with the Asset Disposition that is held in escrow or on deposit to support indemnification, adjustment of purchase price or similar obligations in respect of such Asset Disposition consists ofshall be considered to be cash, and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) within 365 days after the later of the date of such Asset Disposition and the receipt of such Net Available Cash:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesto prepay, notes repay, purchase, repurchase, redeem, retire, defease or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date otherwise acquire for value Secured Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company or a Subsidiary Guarantor (other than any Disqualified Stock or Subordinated Indebtedness), as a result of which none of the Parent, the Issuer Obligations) or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer not a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of in each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (case other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any an Affiliate of the Company;
(B) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes; provided, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(vin accordance with this clause (B) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted an application of the such Net Available Cash from the date of such commitment until if (i) such reinvestment is consummated within 180 days at the earlier end of such 365 day period referred to in this clause (x3) the date on which such investment is consummated, and (yii) if such reinvestment is not consummated within the 180th day following period set forth in subclause (i) or such binding commitment is terminated, the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such shall constitute available Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.; or
(dC) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”i) to all Holders and, to redeem the extent the Issuer elects, to all Notes or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, make open market purchases thereof at an offer price, in respect of the Notes, equal to no a price not less than 100% of the principal amount thereof or (ii) to make an Asset Disposition Offer to purchase Notes pursuant to and subject to the conditions set forth in Section 4.10(b); provided, however, that if the Company elects (or is required by the terms of any Pari Passu Indebtedness), such Asset Disposition Offer may be made ratably (determined based upon the respective principal amounts of the Notes and such Pari Passu Indebtedness being purchased or repaid) to purchase the Notes and to purchase or otherwise repay such Pari Passu Indebtedness; provided that pending final application of any such Net Available Cash in accordance with clause (3)(A), (B) or (C) above, the Company and the Restricted Subsidiaries may temporarily reduce revolving Indebtedness outstanding under the Existing Credit Agreement or otherwise invest such Net Available Cash in any manner not prohibited by this Indenture. To the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) above, the Company or such Restricted Subsidiary, as the case may be, may use such balance for any general corporate purpose not prohibited by the terms of this Indenture. In connection with any prepayment, repayment, purchase, repurchase, redemption, retirement, defeasance or other acquisition for value of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary, as the case may be, will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid, purchased, repurchased, redeemed, retired, defeased or otherwise acquired for value. Notwithstanding the foregoing provisions of this Section 4.10, the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this covenant exceeds $100,000,000.
(b) In the event of an Asset Disposition that requires the purchase of Notes pursuant to Section 4.10(a)(3)(C), the Company will be required
(i) to purchase Notes tendered pursuant to an offer by the Company for the Notes (the “Asset Disposition Offer”) at a purchase price of 100% of their principal amount plus accrued and unpaid interest, if any, to, but not including, interest thereon to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made Holders of record on the relevant date to receive interest due on the relevant Interest Payment Date) in accordance with the procedures procedures, including prorating in the event of oversubscription, set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.and
(eii) Upon completion to purchase or otherwise repay Pari Passu Indebtedness of the Company on the terms and to the extent contemplated thereby at the purchase price set forth in the relevant documentation (including accrued and unpaid interest to the date of acquisition, the “purchase price”), provided that to the extent the purchase price of any such Pari Passu Indebtedness exceeds 100% of the principal amount thereof, plus accrued and unpaid interest thereon to the date of acquisition, the Company shall not use any Net Available Cash to pay such purchase price, except as permitted by the next sentence. If the aggregate purchase price of Notes and Pari Passu Indebtedness tendered pursuant to the Asset Disposition OfferOffer is less than the Net Available Cash allotted to the purchase of the Notes and Pari Passu Indebtedness, the amount Company will apply the remaining Net Available Cash for any general corporate purpose not prohibited by the terms of Excess Proceeds that resulted in the requirement this Indenture. The Company will not be required to make an Asset Disposition Offer shall for Notes and Pari Passu Indebtedness pursuant to this Section 4.10 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 4.10(a)(3)(A) and (B)) is less than $100,000,000 for any particular Asset Disposition (which lesser amount will be reset carried forward for purposes of determining whether an Asset Disposition Offer is required with respect to zero (regardless of whether there are the Net Available Cash from any remaining Excess Proceeds upon such completionsubsequent Asset Disposition). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount Net Available Cash in respect of Excess Proceeds any Asset Disposition(s) shall be reset at reduced to zero.
(fc) To (i) Promptly, and in any event within 20 days after the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Company becomes obligated to make an Asset Disposition Offer, insofar as it relates the Company shall be obligated to deliver to the Trustee and send or, at the request of the Company have the Trustee send (such notice to be provided to the Trustee at least five Business Days before the Trustee is requested to send such notice unless a shorter period shall be satisfactory to the Trustee), in the name and on behalf of the Company, by first-class mail to each Holder, or in the case of Global Notes, will remain open for send in accordance with the Applicable Procedures of the Depositary, a period of not less than five written notice stating that the Holder may elect to have its Notes purchased by the Company either in whole or in part (5) Business Days following its commencement (subject to prorating as hereinafter described in the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of event the Asset Disposition Offer Period is oversubscribed) in minimum denominations of $2,000 of principal amount or any greater integral multiple of $1,000 thereof, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the “Asset Disposition Purchase Date”) and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports); provided that in lieu of providing the reports specified in this subclause (1), the Issuer will purchase Company may, at its option, notify the principal amount holders that such reports are available to them in electronic format through the SEC’s ▇▇▇▇▇ system, (2) a description of Notes and, material developments in the Company’s business subsequent to the extent it electsdate of the latest of such reports, Senior Indebtedness required and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to be repaid or purchased by it tender Notes pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, together with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations address referred to in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
clause (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notesiii).
Appears in 1 contract
Sources: Indenture (Qorvo, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Holdings will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) Holdings (or the Restricted Subsidiary, as the case may be) receives consideration at the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than the fair market value time of the assets disposed of Asset Sale at least equal to the Fair Market Value (determined as of the date of entry into binding documentation in respect of contractual agreement to such Asset Disposition Sale) of the assets or Equity Interests issued or sold or otherwise disposed of;
(2) in the case of an Asset Sale of Collateral, the consideration from such Asset Sale is pledged as determined Collateral to secure the Notes (to the extent required by the Parent’s Board of DirectorsNotes Collateral Documents), at least until such time it is otherwise applied in accordance with this Section 3.5; and
(ii3) at least 75% of the consideration received in the Parent Asset Sale by Holdings or any of its Restricted Subsidiaries is in the form of cash, Cash Equivalents or Replacement Assets. For purposes of this provision, each of the following will be deemed to be cash:
(i) any Indebtedness or liabilities, as shown on Holdings’ most recent consolidated balance sheet or in the footnotes thereto (or, if incurred or accrued subsequent to the date of such balance sheet, such liabilities that would have been reflected on Holdings’ most recent consolidated balance sheet or in the footnotes thereto if such incurrence or accrual had taken place on or prior to the date of such balance sheet, as determined in good faith by Holdings), of Holdings or any of its Restricted Subsidiaries (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Note Guarantee) that are assumed by the transferee of any such assets and for which Holdings or such Restricted Subsidiary receives has been released in respect of such Asset Disposition consists of:writing;
(Aii) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by Holdings or any such Restricted Subsidiary from such transferee that are converted by Holdings or such Restricted Subsidiary into cash or Cash Equivalents within 180 days of the receipt thereof, to the extent of the cash or Cash Equivalents received in consideration of such Asset Disposition)that conversion;
(B) Cash Equivalents;
(C) the assumption by the purchaser of (xiii) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock stock or assets of the kind referred to in clause clauses (iv2) or (vi4) of Section 4.05(b3.5(b);; and
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Giv) any Designated Non-Cash cash Consideration received by the Parent Holdings or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market value, Fair Market Value (with the Fair Market Value of each item of Designated Non-cash Consideration being determined as of the date of contractual agreement to such Asset Sale) taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (d) that is at any one that time outstanding, outstanding not to exceed the greater of 15(x) $10.0 million and (y) 15.0% of Consolidated EBITDA of Holdings and $150 million (with its Restricted Subsidiaries for the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)most recently ended four fiscal quarters for which internal financial statements are available.
(b) If Within 360 days after the Parent, the Issuer or receipt of any other Restricted Subsidiary consummates Net Proceeds from an Asset DispositionSale, within 360 days (Holdings or such period as provided in clause (viii) below, if applicable) one or more of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use apply an amount equal to such Net Proceeds at its option to any combination of the Net Available Cash tofollowing:
(i1) (ax) prepayif assets subject to such Asset Sale constitute Collateral, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repayrepay or purchase (i) Indebtedness and other Obligations under the ABL Credit Agreement (or any Permitted Refinancing Indebtedness in respect thereof), purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before (ii) Obligations in respect of the Notes’ Stated Maturity only if the Parent or the Issuer makes , (at such time or iii) Obligations in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount respect of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured by a Lien on the Collateral or (iv) Indebtedness that is secured by the assets that which are the subject of such Asset Sale and (y) if assets subject to such Asset Sale do not constitute Collateral Collateral, to prepay, repay or purchase Senior Indebtedness of Holdings or any of its Restricted Subsidiaries (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Holdings or any another Restricted Subsidiary);
; provided that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (ii1), Holdings or any such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than obligations in respect of any asset-based credit facility (including Indebtedness under the ABL Credit Agreement or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Sale constituted “borrowing base assets”) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; provided further that in connection with any prepayment, repayment or purchase any series of Indebtedness other than Obligations in respect of the Notes pursuant to an offer to all Holders of such series of Notesclause (1)(x)(iii) or (iv) or (1)(y), redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of the Issuer shall also equally and ratably reduce Indebtedness under the Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes offer (in accordance with the procedures set out belowforth below for an Asset Sale Offer with Excess Proceeds) to all Holders to purchase, on a pro rata basis (subject to adjustments to maintain the authorized denominations for the Notes), the principal amount of Notes, in each case, at a purchase price equal to 100.000% of the principal amount (or accreted value, as applicable) plus accrued and unpaid interest, if any, to, but excluding, the date of purchase;
(iii2) invest in any Replacement Assets;
(iv) to acquire all or substantially all of the assets of, a division or any line of business of or a majority of the Capital Stock of, another Person engaged in a Similar Permitted Business, if, after giving effect to any such acquisition of Capital Stock, such Person the Permitted Business is or becomes a Restricted SubsidiarySubsidiary of Holdings;
(v3) to make a capital expenditureexpenditure or other expenditures in connection with the construction, operation, maintenance, repair or improvement of existing properties and assets;
(vi4) to acquire other or invest in Replacement Assets or acquire long-term assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar another Permitted Business;; or
(vii5) consummate any combination of the foregoing; or
provided that in the case of clauses (viii2), (3) enter and (4) above, (i) any such acquisition, expenditure or investment in accordance with such clause may be made by means of an acquisition, expenditure or investment by a Restricted Subsidiary in an amount equal to the Net Proceeds received by Holdings or another Restricted Subsidiary, (ii) if Holdings or any Restricted Subsidiary enters into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i)within such 360 day period, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a such binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from such Asset Sale if an amount equal to such Net Proceeds is applied within 180 days of the end of the 360 day period (provided further that if such commitment is later terminated or canceled before such Net Proceeds are applied and Holdings or any Restricted Subsidiary enters into another binding commitment (the “Second Commitment”) within 180 days of such cancellation or termination (or, if later, 360 days from the date receipt of such commitment until Net Proceeds), such Second Commitment shall be treated as a binding commitment; provided further that if any Second Commitment is later terminated or canceled before such Net Proceeds are applied, then such Net Proceeds shall constitute Excess Proceeds if not otherwise applied as provided above within 360 days of the earlier receipt of such Net Proceeds), (xiii) the date on which if assets subject to such Asset Sale constitute Collateral, any assets acquired or investment is consummated, described in clauses (2) and (y4) above shall be pledged as Collateral to secure the 180th day following Notes to the expiration of extent required by the aforementioned 360-day periodNotes Collateral Documents (and pursuant to the terms thereof) and (iv) if assets subject to such Asset Sale constitute Collateral, if any such assets underlying any expenditure described in clause (3) above shall be pledged as Collateral to secure the investment has not been consummated Notes to the extent required by that datethe Notes Collateral Documents (and pursuant to the terms thereof).
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of the amount of any such Net Available CashProceeds, the Parent Holdings or any of its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings or otherwise utilize such apply the Net Available Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. Holders of Notes may not have control of, or a perfected security interest in the Net Proceeds, which could diminish the value of the Collateral.
(d) On the 361st day (The amount of any Net Proceeds from Asset Sales that is not applied or the 541st day if a binding commitment invested as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if above will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds the greater of (x) $60 million15.0 million and (y) 17.0% of Consolidated EBITDA, within 30 days thereof, unless waived or modified with the consent of the Holders of at least a majority in aggregate principal amount of the Notes then outstanding, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) Sale Offer to all Holders and, of Notes (with a copy to the extent the Issuer elects, to Trustee) and all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, pari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem such Indebtedness with the proceeds of sales of assets to purchase the maximum principal amount of Notes and any such other Senior pari passu Indebtedness that may be purchased out of the Excess Proceeds, at Proceeds (an “Asset Sale Offer”). The offer price, price in respect of the Notes, any Asset Sale Offer will be equal to no less than 100100.000% of the principal amount thereof being purchased, plus accrued and unpaid interest, if any, to, to but not includingexcluding, the date of purchase, and will be payable in cash. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer obligation with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) Proceeds from Asset Sales by making an Asset Sale Offer with respect to all or part a portion of the available Net Available Cash Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture (the “Advance Offer”). If any Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) remain after consummation of an Asset Sale Offer, the Issuer may use those Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Issuer will select the Notes and such other pari passu Indebtedness to be purchased on a pro rata basis (subject to adjustments to maintain the authorized denominations for the Notes). Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
(ie) The Issuer will comply, to the extent applicable, comply in all material respects with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other securities laws or and regulations thereunder to the extent those laws and regulations are applicable in connection with the each repurchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions of this Section 4.05Indenture, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Asset Sale provisions of this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (CPI Card Group Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is consideration (both cash and non cash) equal to not less than the fair market value of the assets disposed of as of Fair Market Value (such Fair Market Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andshares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents or Replacement Assets. For purposes of this clause (2), each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the face of the Company’s or such Restricted Subsidiary’s then most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and Subordinated Obligations) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:from further liability;
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in consideration that conversion) within 180 days of the closing of such Asset Disposition);; and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gc) any Designated Non-Cash Noncash Consideration received by the Parent Company or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value (as determined in good faith by the Board of Directors of the Company), taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (c) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 100.0 million (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); orand
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant3) an offer amount equal to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition:
(a) first, is applied by the Company or such Restricted Subsidiary, as the case may be,
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Bank Indebtedness) to prepay, repay or purchase Bank Indebtedness of the Company or of a Restricted Subsidiary within 365 days from the date of such commitment until the earlier of Asset Disposition (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of “Application Period”), unless to the extent such Net Available Cash not is otherwise used in accordance with clause (ii); provided, however, that, in connection with any prepayment, repayment or purchase of any such Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so used prepaid, repaid or purchased, or
(ii) to the extent the Company or any Restricted Subsidiary, as the case may be, elects, to invest in Replacement Assets within the applicable Application Period; and
(b) second, to the extent of the balance of the Net Available Cash after application in accordance with (a) above (such balance, “Excess Proceeds”), is applied by the Company or such Restricted Subsidiary, as the case may be, toward an offer to purchase Notes as set forth above constitutes “Excess Proceeds.” Pending in the next succeeding paragraph; provided, however, that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) . On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time date, if any, as the Issuer electsBoard of Directors of the Company or such Restricted Subsidiary determines that the Net Available Cash will not be applied in accordance with clause (3)(a) of the first paragraph of this Section 4.15), if the aggregate amount of Excess Proceeds exceeds $60 50.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (an “Asset Disposition Offer”) to all Holders of Notes and, to the extent required by the Issuer electsterms of other Senior Indebtedness, to all or some holders of other outstanding Senior Indebtedness that is outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Indebtedness with the proceeds from any Asset Disposition (“Pari Passu Indebtedness, Notes”) to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indentureherein or the agreements governing the Pari Passu Notes, as applicable, in minimum denominations of $200,000 and each case in integral multiples of $1,000 in excess thereof.
principal amount (e) Upon completion provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such Asset Disposition Offer, other integral multiples as may be specified in the agreements governing the Pari Passu Notes. To the extent that the aggregate amount of Excess Proceeds that resulted in the requirement Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offerfor general corporate purposes, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by subject to other covenants contained in this Indenture. If the aggregate principal amount of Notes and such other Senior Indebtedness Pari Passu Notes validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee, in accordance with (in the case of Global Notes) the applicable procedures of the Depository, shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness the holders, trustees or similar representatives, as the case may be, of Pari Passu Notes shall select the Pari Passu Notes to be purchased on a pro rata based basis on the basis of the aggregate principal amount of such tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The . Each Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness and Pari Passu Notes required to be repaid or purchased by it pursuant to such offer this Section 4.15 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness Notes validly tendered in response to the Asset Disposition Offer.. Upon the commencement of an Asset Disposition Offer, the Company shall send, by first class mail, a notice to the Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Asset Disposition Offer. Any Asset Disposition Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:
(h1) that the Asset Disposition Offer is being made pursuant to this Section 4.15;
(2) the Asset Disposition Offer Amount and the Asset Disposition Purchase Date;
(3) that any Notes not tendered or accepted for payment shall continue to accrete or accrue interest;
(4) that, unless the Company defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrete or accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to the Asset Disposition Offer may only elect to have all of such Note purchased and may not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Asset Disposition Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by book-entry transfer, to the Company, a depository, if appointed by the Company, or the Paying Agent at the address specified in the notice at least three days before the Asset Disposition Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the Company, the Depository or the Paying Agent, as the case may be, receives, not later than the second business day prior to the Asset Disposition Purchase Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased);
(9) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(10) all other procedures, if any, determined by the Company, consistent with this Indenture, that a Holder must follow in order to have its Notes purchased in the Asset Disposition Offer. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, any accrued and unpaid interest will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of such Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in each case in integral multiples of $1,000 in principal amount (provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such other integral multiples as may be specified in the agreements governing such Pari Passu Notes. The Parent Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4.15 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Notes. Any Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Disposition Offer on or promptly following the Asset Disposition Purchase Date. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries may satisfy as an entirety to a Person in a transaction permitted under Article 5, which transaction does not constitute a Change of Control, the foregoing obligations successor company shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Disposition. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Available Cash prior to the expiration for purposes of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) Section 4.15. The Issuer Company will comply, to the extent applicable, with the requirements of Section Rule 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).Section
Appears in 1 contract
Sources: Indenture (Southwest Atlanta Dialysis Centers, LLC)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition following the Issue Date unless:
(i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at least equal to the Fair Market Value (such Asset Disposition is not less than the fair market value of the assets disposed of Fair Market Value to be determined as of the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors)assets subject to such Asset Disposition; and
(ii) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents. The Company shall determine the Fair Market Value of any consideration from such Asset Disposition that is not cash or Cash Equivalents.
(b) For the purposes of this Section 3.07, the following are deemed to be cash: (x) the assumption of Indebtedness or other liabilities of the Company (other than Disqualified Stock or Junior Indebtedness) or Indebtedness or other liabilities of any Restricted Subsidiary (other than Disqualified Stock or Junior Indebtedness) and the release of the Company or such Restricted Subsidiary receives from all liability on such Indebtedness or liabilities in respect of connection with such Asset Disposition consists of:
Disposition, (Ay) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other similar obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Company or any liabilities recorded on Restricted Subsidiary from the Parent’s, transferee that are converted within 180 days by the Issuer’s Company or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, into cash and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gz) any Designated Non-Cash cash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market valueFair Market Value (determined in Good Faith by the Company), taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (z) that is at any one that time outstanding, not to exceed $57.5 million at the greater time of 15% the receipt of Consolidated EBITDA and $150 million such Designated Non-cash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (McClatchy Co)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition following the Issue Date unless:
(i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is not less than consideration at least equal to the fair market value of the assets disposed of (such fair market value to be determined as of the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (Disposition), as determined in Good Faith by the Parent’s Board Company (including as to the value of Directorsall non-cash consideration); and, of the assets subject to such Asset Disposition;
(ii) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of cash or Cash Equivalents; and
(iii) in the case of an Asset Disposition of Collateral, the remaining consideration from such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)form of cash or Cash Equivalents is thereupon with its acquisition pledged as Collateral to secure the Notes.
(b) If Any Net Available Cash received by the Parent, the Issuer Company or any other Restricted Subsidiary consummates from any Asset Disposition:
(1) in the case of (A) the first $100.0 million of Net Available Cash received by the Company or any Restricted Subsidiary following the Issue Date from all Asset Dispositions (other than any Sale/Leaseback Transaction) consummated after the Issue Date, (B) 75% of any Net Available Cash received by the Company or any Restricted Subsidiary from any other Asset Disposition (other than any Sale/Leaseback Transaction) consummated after the Issue Date shall be applied (x) in the case of any Asset Disposition by a Non-Guarantor Subsidiary or consisting of Capital Stock of a Non-Guarantor Subsidiary, to repay Indebtedness of a Non-Guarantor Subsidiary within 30 days of receipt of such Net Available Cash or (y) otherwise, to make an Asset DispositionDisposition Offer in accordance with the following paragraph and (C) 50% of any Net Available Cash received by the Company or any Restricted Subsidiary from any Sale/Leaseback Transaction constituting an Asset Disposition consummated after the Issue Date shall be applied (x) in the case of any Asset Disposition by a Non-Guarantor Subsidiary or consisting of Capital Stock of a Non-Guarantor Subsidiary, to repay Indebtedness of a Non-Guarantor Subsidiary within 360 30 days of receipt of such Net Available Cash or (y) otherwise, to make an Asset Disposition Offer in accordance with Section 3.8(c); and
(2) in the case of any Net Available Cash received by the Company or such period any Restricted Subsidiary that is not required to be applied as provided in clause (viii1) belowabove, if applicablewithin 365 days to (x) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included reinvest in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Related Business;
(vii) consummate any combination of , provided that to the foregoing; or
(viii) enter into a binding commitment extent the assets subject to apply the Net Available Cash pursuant to Section 4.05(b)(i)such Asset Disposition were Collateral, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) such newly acquired assets shall also be Collateral or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) in the 180th day following the expiration case of the aforementioned 360an Asset Disposition by a Non-day periodGuarantor Subsidiary or consisting of Capital Stock of a Non-Guarantor Subsidiary, if the investment has not been consummated by that dateto repay Indebtedness of a Non-Guarantor Subsidiary.
(c) The amount of such All Net Available Cash that is not so used applied or invested as provided in subclause (1)(B)(x) or (1)(C)(x) or clause (2) of Section 3.8(b) within the time periods set forth above constitutes therein will be deemed to constitute “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if When the aggregate amount of Excess Proceeds exceeds $60 10.0 million, the Issuer will Company shall be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, apply such Excess Proceeds to purchase the maximum principal amount of the Notes and any such other Senior Indebtedness (on a pro rata basis) that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes, plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the rights of Notes will be made Holders of record on any record date to receive payments of interest on the related Interest Payment Date), in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and Indenture in integral multiples of $1,000 (except that no Note will be purchased in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, part if the remaining principal amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall would be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completionless than $2,000). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and To the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If extent that the aggregate amount of Notes and such other Senior Indebtedness so validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of is less than such Excess Proceeds, the Company may use any remaining portion of such Excess Proceeds shall be allocated among that is not applied to purchase Notes (“Unutilized Excess Proceeds”) for general corporate purposes or as otherwise required pursuant to its other contractual requirements, subject to the tendering Holders of Notes and such other Senior Indebtedness pro rata based on covenants contained in this Indenture. If the aggregate principal amount of Notes and surrendered by Holders exceeds the amount of such other Senior Indebtedness so tendered and not properly withdrawn. For Excess Proceeds, the purposes Notes to be purchased shall be selected on a pro rata basis on the basis of calculating the aggregate principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodNotes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(gi) The Asset Disposition Offer, insofar as it relates to the Notes, will Offer shall remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will Company shall purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer this Section 3.8 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(hii) If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid on such Asset Disposition Purchase Date to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Asset Disposition Offer.
(iii) On or before the Asset Disposition Purchase Date, the Company shall, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes or portions of Notes validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes validly tendered and not properly withdrawn, in each case in denominations of $1,000 (except that no Note shall be purchased in part if the remaining principal amount would be less than $2,000). The Parent Company or the Paying Agent, as the case may be, shall promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes an amount equal to the purchase price of the Notes validly tendered and its Restricted Subsidiaries may satisfy not properly withdrawn by such holder and accepted by the foregoing obligations with respect Company for purchase, and the Company shall promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, shall authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any Net Available Cash from unpurchased portion of the Note surrendered; provided that each such new Note shall be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. Any Note not so accepted shall be promptly mailed or delivered by the Company to the Holder thereof. The Company shall publicly announce the results of the Asset Disposition Offer on the Asset Disposition Purchase Date.
(e) For the purposes of this Section 3.8, the following are deemed to be cash: (x) except in the case of an Asset Disposition by making an of Collateral, the assumption of Indebtedness of the Company (other than Disqualified Stock or Subordinated Obligations) or Indebtedness of any Restricted Subsidiary (other than Guarantor Subordinated Indebtedness or Disqualified Stock of any Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition Offer with respect to such Net Available Cash prior to and (y) securities, notes or similar obligations received by the expiration of Company or any Restricted Subsidiary from the relevant 360 transferee that are converted within 90 days (by the Company or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this IndentureRestricted Subsidiary into cash.
(if) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 3.8. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.053.8, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture by virtue of such complianceIndenture.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Blockbuster Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted of its Subsidiary to, consummate any Asset Disposition unlessSale unless the following conditions are met:
(i) the Company (or the Subsidiary, as the case may be) receives consideration at the Parent, the Issuer or such other Restricted Subsidiary receives for time of such Asset Disposition is not less than Sale at least equal to the fair market value Fair Market Value (as determined in good faith by the Company) of the assets or Equity Interests issued or sold or otherwise disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors)of; and
(ii) at least 75% of the consideration therefor received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists ofcash or cash equivalents, provided that, for purposes of this provision, each of the following shall be deemed to be cash:
(A) cash any liabilities (including as shown on the Company’s or such Subsidiary’s most recent balance sheet) of the Company or any Net Cash Proceeds received Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes and liabilities that are owed to the Company or any Affiliate of the Company) that are assumed by the transferee of any such assets by operation of law or pursuant to a customary written novation agreement or an indemnification arrangement that releases or covers the Company or such Subsidiary from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);further liability; and
(B) Cash Equivalents;
any securities or other obligations (Cother than promissory notes) the assumption received by the purchaser Company or any such Subsidiary from such transferee that are within 180 days (subject to ordinary settlement periods) converted by the Company or such Subsidiary into cash (to the extent of the cash or cash equivalents received in that conversion). Within 365 days after the receipt of any net proceeds from an Asset Sale, the Company may apply an amount equal to such net proceeds at its option: (x) any liabilities recorded on the Parent’sto prepay, the Issuer’s repay or such other Restricted repurchase (1) Indebtedness of a Subsidiary’s balance sheet , or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet2) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, 2027 Notes; or (y) Indebtedness of to invest in (or enter into a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred legally binding agreement to in clause (ivinvest in) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer purchase replacement assets or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash expenditure in or Cash Equivalents) that are is used or useful in a Similar Business;
(vii) consummate any combination the business of the foregoingCompany; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i)provided, Section 4.05(b)(iii)however, Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted that if after application of the net proceeds from an Asset Sale, the remaining unapplied Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day periodProceeds, if the investment has not been consummated by that date.
any (c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash”), exceed $5,000,000, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will Company shall be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Sale Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase repurchase on a pro rata basis the maximum principal amount of Notes and any up to the amount of such other Senior Indebtedness that may be purchased out of the Excess Proceeds, Proceeds at an offer price, in respect of the Notes, equal to no less than 100% of the outstanding principal amount thereof of Notes to be redeemed, plus accrued and unpaid interest, if any, principal or interest thereon to, but not includingexcluding, the date of purchase. The Asset Disposition Offer in respect purchase (subject to the rights of Notes will be made Holders of record on any record date to receive payments of principal and interest on the related Quarterly Payment Date), in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and Indenture in integral multiples of $1,000 (except that no Note will be purchased in excess thereofpart if the remaining principal amount would be less than $2,000).
(e1) Upon completion of any such Asset Disposition Offer, To the amount of Excess Proceeds extent that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness so validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer exceeds is less than the amount of Excess Proceeds, the Company may use any remaining portion of such Excess Proceeds shall be allocated among that is not applied to purchase Notes (“Unutilized Excess Proceeds”) for general corporate purposes, the tendering Holders repayment of Notes and such Indebtedness or as otherwise required pursuant to its other Senior Indebtedness pro rata based on contractual requirements, subject to the terms of this Indenture. If the aggregate principal amount of Notes surrendered by Holders exceeds the Excess Proceeds, the Notes to be purchased shall be selected in accordance with the policies and such other Senior Indebtedness so tendered and not properly withdrawn. For procedures of the purposes applicable depositary on a pro rata basis on the basis of calculating the aggregate principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zeroNotes.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g2) The Asset Disposition Offer, insofar as it relates to the Notes, will Sale Offer shall remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Sale Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Sale Offer Period (the “Asset Disposition Sale Purchase Date”), the Issuer will Company shall purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer this Section 3.17 (the “Asset Disposition Sale Offer Amount”) or, if less than the Asset Disposition Sale Offer Amount has been so validly tenderedtendered and not properly withdrawn, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Sale Offer.
(h3) On or before the Asset Sale Purchase Date, the Company shall, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Sale Offer Amount of Notes or portions of Notes validly tendered and not properly withdrawn pursuant to the Asset Sale Offer, or if less than the Asset Sale Offer Amount has been validly tendered and not properly withdrawn, all Notes validly tendered and not properly withdrawn, in each case in minimum denominations of $1,000 (except that no Note shall be purchased in part if the remaining principal amount would be less than $2,000). The Parent Company or the Paying Agent, as the case may be, shall promptly (but in any case not later than five Business Days after termination of the Asset Sale Offer Period) pay to each tendering Holder of Notes an amount equal to the purchase price of the Notes validly tendered and its Restricted Subsidiaries may satisfy not properly withdrawn by such holder and accepted by the foregoing obligations with respect Company for purchase, and the Company shall promptly issue a new Note, and the Trustee, upon receipt of an Authentication Order, shall authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any Net Available Cash from unpurchased portion of the Note surrendered; provided that each such new Note shall be in a minimum principal amount of $2,000 or an Asset Disposition integral multiple of $1,000 in excess thereof. Any Note not so accepted shall be promptly mailed or delivered by making an Asset Disposition Offer with respect to such Net Available Cash prior the Company to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this IndentureHolder thereof.
(i4) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 3.17. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.053.17, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture by virtue of such complianceSection 3.17.
(jb) Except as Neither the Company nor any of its Subsidiaries shall issue, sell, transfer or otherwise provided in dispose of any Capital Stock of a Subsidiary, except to the Company or one of its other Subsidiaries that agrees to hold the transferred shares subject to the terms of this Section 9.013.17, unless (1) the Company sells, transfers or otherwise disposes of the entire Capital Stock of the Subsidiary at the same time for cash or property that is at least equal to the Fair Market Value of the Capital Stock or (2) the Company sells, transfers or otherwise disposes of any Capital Stock of a Subsidiary for at least Fair Market Value and, after giving effect thereto, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount Company and its Subsidiaries would own more than 80% of the Notes (with issued and outstanding Voting Stock of such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount Subsidiary. For purposes of the Notes foregoing, Fair Market Value shall be as determined by the Company or the Board of consenting Holders represents a majority Directors of the aggregate outstanding principal amount Company, as set forth in the definition of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)Fair Market Value.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition of any assets that do not constitute ABL Priority Collateral (“Non-ABL Priority Collateral”) unless:
: (i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition at least equal to the Fair Market Value (including as determined by to the Parent’s Board value of Directors)all non-cash consideration) of the shares and other assets subject to such Asset Disposition; and
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary is in the form of cash or Temporary Cash Investments; (3) without limitation of the provisions described under Section 4.15, to the extent that any consideration received by the Company or any Restricted Subsidiary from such Asset Disposition consists of assets that constitute Notes Priority Collateral, such assets, including any such assets of any Person that becomes a Subsidiary Guarantor as a result of such transaction, are concurrently with their acquisition added to the Notes Priority Collateral; (4) the Net Available Cash from any such Asset Disposition of Notes Priority Collateral is either (i) paid directly by the purchaser thereof to the Noteholder Collateral Agent to be held in trust in the Asset Sale Proceeds Account or (ii) deposited to the Asset Sale Proceeds Account within five Business Days after receipt thereof, in each case, for application in accordance with this Section 4.06; (5) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) within 365 days of the receipt of such Net Available Cash: (A) to make one or more offers to the Holders (and, at the option of the Company, the holders of Other Pari Passu Lien Obligations) to purchase Securities (and such Other Pari Passu Lien Obligations) pursuant to and subject to the conditions contained in this Indenture (each, an “Asset Disposition Offer”); provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (A), the Company or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; provided further that if the
(b) The Company shall not, and shall not permit any Restricted Subsidiary to, make any Asset Disposition of any ABL Priority Collateral, unless: (1) the Company or such Restricted Subsidiary receives in respect consideration at the time of such Asset Disposition consists of:
(A) cash at least equal to the Fair Market Value (including any Net Cash Proceeds received from as to the conversion within 180 days value of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(Ball non-cash consideration) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (shares and other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of assets subject to such Asset Disposition;
(D4) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Any Net Available Cash from the date of such commitment until the earlier of (xan Asset Disposition covered by this Section 4.06(b) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (invested or the 541st day if a binding commitment applied, or committed to be invested or applied, as described provided in Section 4.05(b)(viii4.06(b)(3) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if will be deemed to constitute “Excess ABL Proceeds”. When the aggregate amount of Excess ABL Proceeds exceeds $60 million15,000,000, within 30 days thereof, the Issuer will be required within twenty (20) Business Days thereof to Company shall make an offer (an “ABL Asset Disposition Offer”) to all Holders Holders, and, if required by the terms of any Other Pari Passu Lien Obligations to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is such Other Pari Passu IndebtednessLien Obligations, to purchase the maximum aggregate principal amount of Notes the Securities and any such other Senior Indebtedness Other Pari Passu Lien Obligations, that may be purchased out of the Excess Proceeds, ABL Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Securities and Other Pari Passu Lien Obligations, in each case, plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect , subject to, without duplication, the right of Notes will be made Holders of record on the relevant record date to receive interest due on the relevant interest payment date, in accordance with the procedures set forth in this IndentureIndenture or the agreements governing the Other Pari Passu Lien Obligations, as applicable, and, with respect to the Securities, in minimum denominations of $200,000 2,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make . The Company shall commence an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an ABL Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).Excess ABL Proceeds
Appears in 1 contract
Sources: Indenture (Us Concrete Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition of Collateral unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is not less than consideration at least equal to the fair market value of the assets disposed of as of (such fair market value to be determined on the date of entry into binding documentation contractually agreeing to such Asset Disposition), as determined in respect good faith by the Board of Directors (including as to the value of all non-cash consideration), of the Collateral subject to such Asset Disposition (as determined notwithstanding the foregoing, the consideration received by the Parent’s Board Company or any of Directorsits Restricted Subsidiaries from the sale of the Uhrichsville, Ohio facility on terms materially consistent with the terms, as in effect as of the Issue Date, set forth in Exhibit G to the Supply Agreement by and among Commonwealth Aluminum Corporation, IMCO Recycling of Ohio Inc. and IMCO Recycling Inc., dated as of April 1, 1999, or the sale of the Saginaw, Michigan facility on terms materially consistent with the terms, as in effect as of the Issue Date, set forth in Exhibit 5 to the Long Term Agreement between General Motors Corporation and Alchem Aluminum Inc., dated as of February 26, 1999, shall, in each case, be deemed to be fair market value for purposes of this paragraph); and;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of cash or Cash Equivalents and 100% of the Net Available Cash therefrom is deposited directly by the Company into the Collateral Account; and
(3) the remaining consideration from such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary not in the form of cash or Cash Equivalents is thereupon with its acquisition pledged as a result of such Asset DispositionCollateral to secure the Securities; provided, if the Parenthowever, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that the Credit Facility Collateral Documents restrict the Company's ability to pledge such Indebtedness (i) has been extinguished by other consideration as Collateral, the Issuer Company shall either pledge other property or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary assets as Collateral having an aggregate a fair market value, taken together with all other Designated Non-Cash Consideration received pursuant as determined in good faith by the Board of Directors, at least equal to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue such other consideration or deposit an amount of Designated Non-cash or Cash Consideration being measured Equivalents into the Collateral Account having a value at least equal to the time received and without giving effect fair market value of such other consideration (which Cash or Cash Equivalents may be withdrawn by the Company from the Collateral Account to subsequent changes be invested in valueAdditional Assets in the manner set forth under this subsection (a)); or
provided, further, that prior to such pledge, deposit or withdrawal, the Company shall have delivered to the Trustee an Officers' Certificate stating, as applicable, that (Hi) in accordance with this clause (3), other property or assets may be pledged as Collateral having the fair market value required by said clause, (ii) in accordance with this clause (3), cash or Cash Equivalents are to be deposited into the Collateral Account having the fair market value required by said clause or (iii) funds to be withdrawn from the Collateral Account are to be invested in Additional Assets in compliance with this clause (3) and that, in the case of clause (i), (ii) or (iii), all conditions precedent provided for in this Indenture to such pledge, deposit or withdrawal have been complied with. Any Net Available Cash deposited into the Collateral Account from any combination Asset Dispositions of Collateral, Recovery Events (as described in the next paragraph), Asset Swaps involving the transfer of Collateral (as described in Section 3.5(d) below) or prepayments of the types of consideration specified Intercompany Note may be withdrawn by the Company to be invested by the Company in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, Additional Assets within 360 days (or such period as provided in clause (viii) below, if applicable) of from the later of the date of consummation of (x) such Asset Disposition Disposition, Recovery Event, Asset Swap or prepayments and (y) the receipt of such Net Available Cash, which Additional Assets are thereupon with their acquisition added to the Parent Collateral securing the Notes; provided, however, to the extent that the Credit Facility Collateral Documents restrict the Company's ability to pledge such Additional Assets as Collateral, the Company shall either pledge other property or its Restricted Subsidiaries may use assets as Collateral having a fair market value, as determined in good faith by the Net Available Board of Directors, at least equal to the fair market value of such Additional Assets or deposit an amount of cash or Cash to:
Equivalents into the Collateral Account having a value at least equal to the fair market value of such Additional Assets; provided, further, that prior to such investment (and the related withdrawal from the Collateral Account), pledge or deposit, the Company shall have delivered to the Trustee an Officers' Certificate stating, as applicable, that (i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included funds to be withdrawn from the Collateral Account are to be invested in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or Additional Assets in compliance with this covenantparagraph, (ii) an offer to Holders to purchase Notes, in accordance with this paragraph, other property or assets may be pledged as Collateral having the provisions set forth below for an Asset Disposition Offerfair market value required by said paragraph or (iii) in accordance with this paragraph, cash or Cash Equivalents are to be deposited into the Collateral Account having the fair market value required by said paragraph and that, in such an amount as would reduce the aggregate principal amount case of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepaymentsclause (i), repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to or (iii), all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of conditions precedent provided for in this Indenture to such investment, pledge or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application deposit have been complied with. All of the Net Available Cash received by the Company or such Restricted Subsidiary, as the case may be, from any Recovery Event shall be deposited directly into the Collateral Account and may be withdrawn by the Company or such Restricted Subsidiary to be invested in Additional Assets (which may include performance of a Restoration of the affected Collateral) in accordance with the preceding paragraph within 360 days from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount receipt of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such . Any Net Available Cash from Asset Dispositions of Collateral, Asset Swaps involving the transfer of Collateral, Recovery Events or prepayments of the Intercompany Note that are not applied or invested as provided in any manner that is not prohibited by this subsection (a) or in accordance with the terms of this IndentureCollateral Documents will be deemed to constitute "Excess Collateral Proceeds.
(d) " On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Asset Swap, Recovery Event or such earlier time as prepayment of the Issuer electsIntercompany Note pursuant to this subsection (a), if the aggregate amount of Excess Collateral Proceeds exceeds $60 5.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset "Collateral Disposition Offer”") to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, Securities to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Securities to which the Collateral Disposition Offer applies that may be purchased out of the Excess Collateral Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Securities plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and Indenture in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, 1,000. To the amount of Excess Proceeds extent that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness Securities so validly tendered and not properly withdrawn pursuant to an Asset a Collateral Disposition Offer is less than the Excess Collateral Proceeds, the Company may use any remaining Excess Collateral Proceeds for general corporate purposes, free and clear of any Liens created by the Collateral Documents, subject to other covenants contained in this Indenture. If the aggregate principal amount of Securities surrendered by Holders thereof exceeds the amount of Excess Collateral Proceeds, the Excess Proceeds Trustee shall select the Securities to be allocated among the tendering Holders of Notes and such other Senior Indebtedness purchased on a pro rata based basis on the basis of the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Imco Recycling Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition unless: (1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Disposition which, taken as a whole, is at least equal to the fair market value of the assets or Equity Interests issued or sold or otherwise disposed of; (2) such fair market value is determined by the Company's Board of Directors and evidenced by a resolution of such Board of Directors set forth in an Officers' Certificate delivered to the Agent; (3) at least 75% of the consideration therefor received by the Company or such Restricted Subsidiary is in the form of cash or Cash Equivalents or Marketable Securities and (4) an amount equal to 100% of the Net Proceeds from such Asset Disposition are applied by the Company or such Restricted Subsidiary, as the case may be, (A) first, to the extent the Company or any Restricted Subsidiary is required by the terms of any Senior Indebtedness (other than the Cash Pay Loans or Exchange Notes), to prepay, repay or purchase such Senior Indebtedness; and (B) second, to prepay or redeem the Loans and Exchange Notes at par, plus accrued and unpaid interest, if any, thereon, in accordance with Section 2.5(e); provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to the preceding clause (4)(A), the Company or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment, if any, to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased.
(b) For purposes of this provision, each of the following shall be deemed to be cash:
(i1) any liabilities (as shown on the Company's or such Restricted Subsidiary's most recent balance sheet) of the Company or any Restricted Subsidiary that are assumed by the transferee of any such assets (other than contingent liabilities and liabilities that are by their terms subordinated to all Senior Indebtedness) (in which case the Company shall, without further action, be deemed to have applied such assumed liabilities in accordance with clause 4(A) of Section 6.4(a)); and
(2) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted, sold or exchanged by the Company or such Restricted Subsidiary into cash or Cash Equivalents within 30 (or, after the Conversion Date, 90) days of the related Asset Disposition (to the extent of the cash received in that conversion).
(c) Notwithstanding the foregoing provisions, the Company and its Restricted Subsidiaries will not be required to apply any Net Proceeds in accordance herewith except to the extent that the Net Proceeds from all Asset Dispositions which are not applied in accordance with this covenant exceeds €5,000,000 prior to the Conversion Date and €25,000,000 after the Conversion Date.
(d) The Company will not, and will not permit any of its Restricted Subsidiaries to, engage in any Asset Swaps, unless the Conversion Date shall have occurred and:
(1) at the time of entering into such Asset Swap and immediately after giving effect to such Asset Swap, no Default or Event of Default shall have occurred and be continuing or would occur as a consequence thereof;
(2) the consideration the Parent, the Issuer or such other Restricted Subsidiary receives for terms of such Asset Disposition Swap have been approved by a majority of the members of the Board of Directors of the Company; and
(3) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of such Asset Swap which, taken as a whole, is not less than at least equal to the fair market value of the assets disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors); and
(ii) at least 75% of the consideration the Parent or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)Asset Swap.
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Company, of the shares and assets disposed of as of the date of entry into binding documentation in respect of subject to such Asset Disposition (as determined by the Parent’s Board of Directors); andDisposition;
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash or cash equivalents; provided that the amount of (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded (as shown on the Parent’s, the Issuer’s Company's or such other Restricted Subsidiary’s 's most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Company or any Restricted Subsidiary (other than Subordinated Indebtednessliabilities that are by their terms subordinated to the Securities), as a result that are assumed by the transferee of which none of any such assets (provided that the Parent, the Issuer Company or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from all liability with respect thereto), (B) any guarantee notes, other obligations or securities received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of such Indebtedness as a result the cash received) within 180 days following the closing of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, Disposition and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(GC) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market value, when taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (C) of this paragraph (a) of this Section 4.07 that is at any one that time outstanding, not to exceed the greater $5.0 million at time of 15% receipt of Consolidated EBITDA and $150 million such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value), shall be deemed to be cash for purposes of this provision and for no other purpose; orand
(H3) any combination an amount equal to 100% of the types of consideration specified in Net Available Cash from such Asset Disposition is applied by the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days Company (or such period Restricted Subsidiary, as provided in clause the case may be)
(viiiA) belowto the extent the Company elects (or is required by the terms of any Indebtedness), if applicableto prepay, repay, redeem or purchase Senior Indebtedness or Indebtedness (other than any Disqualified Stock) of a Restricted Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Company) within one year from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash;
(B) to the extent the Company elects, to acquire Additional Assets within one year from the Parent later of the date of such Asset Disposition or its Restricted Subsidiaries may use the receipt of such Net Available Cash;
(C) to the extent of the balance of such Net Available Cash to:after application in accordance with clauses (A) and (B) of this paragraph (a)(3) of this Section 4.07, to make an offer to the holders of the Securities (and to holders of other Senior Subordinated Indebtedness designated by the Company) to purchase Securities (and such other Senior Subordinated Indebtedness) pursuant to and subject to the conditions contained in this Indenture; and
(iD) to the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) of this paragraph (a) prepayof this Section 4.07, repayfor any general corporate purpose permitted pursuant to the terms of this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or redeem (including through open market purchasesC) of this paragraph (a) of this Section 4.07, voluntary tender offers the Company or privately negotiated transactions at market pricessuch Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this paragraph (a) of this Section 4.07 the Company and the Restricted Subsidiaries will not be required to apply any Senior Indebtedness Incurred under Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions which is not applied in accordance with this covenant exceeds $15.0 million. Pending application of Net Available Cash pursuant to this Section 4.01(b)(i); 4.07, such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily reduce revolving credit indebtedness.
(b) unless included in In the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for event of an Asset Disposition Offer, in such an amount as would reduce that requires the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor Securities (and other than Senior Subordinated Indebtedness) pursuant to clause (3)(C) of paragraph (a) of Section 4.07, the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) Company will purchase any series of Notes Securities tendered pursuant to an offer to all Holders by the Company for the Securities (and such other Senior Subordinated Indebtedness) (the "Offer") at a purchase price of 100% of their principal amount (or, in the event such other Senior Subordinated Indebtedness was issued with significant original issue discount, 100% of the accreted value thereof), without premium, plus accrued but unpaid interest (or, in respect of such series other Senior Subordinated Indebtedness, such lesser price, if any, as may be provided for by the terms of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricessuch Senior Subordinated Indebtedness) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures (including prorating in the event of oversubscription) set out below);
(iii) invest forth in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
paragraph (c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).Section
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is consideration (both cash and non-cash) equal to not less than the fair market value of the assets disposed of as of Fair Market Value (such ▇▇▇▇ ▇▇▇▇▇▇ Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andshares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents or Replacement Assets. For purposes of this clause (2), each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the face of the Company’s or such Restricted Subsidiary’s then most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and Subordinated Obligations) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:from further liability; and
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of Company or any such Restricted Subsidiary from such transferee that are contemporaneously (xsubject to ordinary settlement periods) any liabilities recorded on converted by the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
into cash (D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;cash received in that conversion); and
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant3) an offer amount equal to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition:
(a) first, is applied by the Company or such Restricted Subsidiary, as the case may be,
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Senior Indebtedness or Guarantor Senior Indebtedness) to prepay, repay or purchase such Senior Indebtedness or Guarantor Senior Indebtedness (other than Disqualified Stock and other than Indebtedness owed to the Company or an Affiliate of the Company) within 395 days from the date of such commitment until the earlier of Asset Disposition (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of “Application Period”), unless to the extent such Net Available Cash not is otherwise used in accordance with clause (ii); provided, however, that, in connection with any prepayment, repayment or purchase of any such Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so used prepaid, repaid or purchased, or
(ii) to the extent the Company or such Restricted Subsidiary elects, to invest in Replacement Assets within the applicable Application Period; and
(b) second, to the extent of the balance of the Net Available Cash after application in accordance with (a) above, is applied by the Company or such Restricted Subsidiary, as the case may be, toward an offer to purchase Notes as set forth above constitutes “Excess Proceeds.” Pending in the next succeeding paragraph; provided, however, that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
; provided, further, that clauses (d1) and (2) above shall not apply with respect to any Permitted Divestiture. On the 361st 396th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time date, if any, as the Issuer electsBoard of Directors of the Company or such Restricted Subsidiary determines that the Net Available Cash will not be applied in accordance with clause (3)(a) of the first paragraph of this Section 4.15), if the aggregate amount of Excess Proceeds not used to purchase Senior Notes and Senior Pari Passu Notes pursuant to a Senior Asset Disposition Offer (such balance, “Excess Proceeds”) exceeds $60 35.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders of Notes and, to the extent required by the Issuer electsterms of other Senior Subordinated Indebtedness, to all or some holders of other Senior Subordinated Indebtedness outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Subordinated Indebtedness that is with the proceeds from any Asset Disposition (“Pari Passu Indebtedness, Notes”) to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indentureherein or the agreements governing the Pari Passu Notes, as applicable, in minimum denominations of $200,000 and each case in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, 1,000. To the amount of Excess Proceeds extent that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness Pari Passu Notes so validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds for general corporate purposes, subject to other covenants contained in this Indenture. If the aggregate principal amount of Notes surrendered by Holders thereof and other Pari Passu Notes surrendered by holders or lenders of such Pari Passu Notes, collectively, exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness Pari Passu Notes to be purchased on a pro rata based basis on the basis of the aggregate principal amount of tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The . Each Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness and Pari Passu Notes required to be repaid or purchased by it pursuant to such offer this Section 4.15 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness Notes validly tendered in response to the Asset Disposition Offer.. Upon the commencement of an Asset Disposition Offer, the Company shall send, by first class mail, a notice to the Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Asset Disposition Offer. Any Asset Disposition Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:
(h1) that the Asset Disposition Offer is being made pursuant to this Section 4.15;
(2) the Asset Disposition Offer Amount and the Asset Disposition Purchase Date;
(3) that any Notes not tendered or accepted for payment shall continue to accrete or accrue interest;
(4) that, unless the Company defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrete or accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to the Asset Disposition Offer may only elect to have all of such Note purchased and may not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Asset Disposition Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by book-entry transfer, to the Company, a depository, if appointed by the Company, or the Paying Agent at the address specified in the notice at least three days before the Asset Disposition Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the Company, the Depository or the Paying Agent, as the case may be, receives, not later than the second business day prior to the Asset Disposition Purchase Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased);
(9) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(10) all other procedures, if any, determined by the Company, consistent with this Indenture, that a Holder must follow in order to have its Notes purchased in the Asset Disposition Offer. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, any accrued and unpaid interest will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of such Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in each case in integral multiples of $1,000. The Parent Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4.15 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount of $1,000 or an integral multiple of $1,000. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Notes. Any Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Disposition Offer on or promptly following the Asset Disposition Purchase Date. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries may satisfy as an entirety to a Person in a transaction permitted under Article 5, which transaction does not constitute a Change of Control, the foregoing obligations successor company shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Disposition. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Available Cash prior to the expiration for purposes of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) Section 4.15. The Issuer Company will comply, to the extent applicable, with the requirements of Section Rule 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.15. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.15, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such complianceany conflict.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Davita Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will not, and Company will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i) the Company receives consideration the Parent(including by way of relief from, the Issuer or such by any other Restricted Subsidiary receives for such Asset Disposition is not less than person assuming responsibility for, any liabilities, contingent or otherwise) at least equal to the fair market value of the assets disposed of as of (such fair market value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (Disposition), as determined in good faith by the Parent’s Board Company, of Directors); andthe shares and assets subject to such Asset Disposition;
(ii) at least (i) 75% for sales of assets that do not constitute Charged Property or (ii) 100% for sales of assets that constitute Charged Property, of the consideration the Parent or such Restricted Subsidiary receives in respect of for such Asset Disposition consists received by the Company is in the form of cash or Cash Equivalents; and provided that, with respect to sales of assets that do not constitute Charged Property, the amount of
(A) the greater of the principal amount and the carrying value of any liabilities (as reflected on the Company’s most recent consolidated balance sheet or in the footnotes thereto or, if Incurred or increased subsequent to the date of such balance sheet, such liabilities that would have been reflected on the Company’s consolidated balance sheet or in the footnotes thereto if such incurrence or increase had taken place on or prior to the date of such balance sheet, as determined by the Company) of the Company, other than liabilities that are by their terms subordinated to the Facilities, that are (1) assumed by the transferee of any such assets (or a third party in connection with such transfer) pursuant to a written agreement which releases or indemnifies the Company from such liabilities or (2) otherwise cancelled or terminated in connection with the transaction; 211 Project Meria: Senior Facilties Agreement
(B) [Reserved]; and
(C) [Reserved], shall each be deemed to be Cash Equivalents for purposes of this provision and for no other purpose; and
(iii) an amount equal to one hundred (100) per cent. of the Net Available Cash from such Asset Disposition is applied:
(A) cash if the assets sold pursuant to such Asset Disposition constitute Charged Property, the Company shall be required to apply (including I) one hundred (100) per cent. of the Net Available Cash from such Asset Disposition to promptly repay the Facility B2 if, pro forma for such disposition, the Proportionate Net Leverage Ratio is greater than 3.00:1.00; (II) fifty (50) per cent. of the Net Available Cash from such Asset Disposition to repay the Facility B2 if, pro forma for such disposition, the Proportionate Net Leverage Ratio is equal to or less than 3.00:1.00 but greater than 2.50:1.00 and (III); zero (0) per cent. of the Net Available Cash from such Asset Disposition to repay the Facility B2 if, pro forma for such disposition, the Proportionate Net Leverage Ratio is equal to or less than 2.50:1.00. For the avoidance of doubt, any Net Cash Proceeds received from the conversion within 180 days proceeds of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);not required to be applied pursuant to this sub-paragraph (iii)(A) shall not constitute Excess Proceeds and may be used for any purposes not prohibited under this Agreement; and
(B) if the assets sold pursuant to such Asset Disposition do not constitute Charged Property, an amount equal to one hundred (100) per cent. of the Net Available Cash Equivalents;from such Asset Disposition is applied to prepay, repay or purchase any Debt other than Debt owed to the Company or Subordinated Debt and/or to invest in or commit to invest in Additional Assets, provided that:
(C1) the assumption by the purchaser in connection with any prepayment, repayment or purchase of Debt pursuant to sub-paragraph (xB) any liabilities recorded on the Parent’sabove, the Issuer’s or Company will retire such other Restricted Subsidiary’s balance sheet or Debt and will cause the notes thereto related commitment (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheetany) (other than Subordinated Indebtednessin the case of any asset-based credit facility) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased provided further that if the Company elects that any repayment of any revolving credit facility shall constitute an application of Net Available Cash under this paragraph (B) (the amount so elected to be applied being, the "RCF Election Amount"), as such repayment shall be accompanied by a result permanent cancellation of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated commitments under such revolving credit facility in respect of an amount at least equal to such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset DispositionRCF Election Amount;
(D2) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses case of sub-paragraph (ii)(AB) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided thatabove, a binding commitment or letter of intent entered into not later than such 365th day shall be treated as a permitted application of the Net Available Cash from the date of such commitment until or letter of intent so long as the earlier Company enters into such commitment or letter of (x) intent with the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by good faith expectation that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “will be applied to satisfy such commitment or letter of intent within the later of such 365th day and one hundred and eighty (180) days of such commitment or letter of intent (an "Acceptable Commitment") or, in the event any Acceptable Commitment is later cancelled or terminated for any reason before the Net Available Cash is applied in connection therewith, the Company enters into another Acceptable Commitment (a "Second Commitment") within one hundred and eighty (180) days of such cancellation or termination; provided further that if any Second Commitment is later cancelled or terminated for any reason before such Net Available Cash is applied, then such Net Available Cash shall constitute Excess Proceeds.” Pending ; and 212 Project Meria: Senior Facilties Agreement
(3) pending the final application of the amount of any such Net Available CashCash in accordance with sub-paragraph (B) above or otherwise in accordance with this Section 4, the Parent or any Restricted Subsidiary Company may temporarily reduce revolving credit borrowings Debt or otherwise utilize use such Net Available Cash in any manner not prohibited by this Agreement.
(b) The amount of Net Available Cash from Asset Dispositions that is not prohibited by the terms of this Indenture.
applied or invested or committed to be applied or invested as provided in paragraph (da) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer above will be required within twenty (20) Business Days thereof deemed to make an offer (“Asset Disposition Offer”) to all Holders andconstitute "Excess Proceeds" under this Agreement; provided that, to the extent the Issuer electsCompany has elected to prepay, repay or purchase any amount of Debt pursuant to sub-paragraph (a)(iii)(B) above (other than Obligations under this Agreement) at a price of no less than one hundred (100) per cent. of the principal amount thereof, and has extended such offer to the Lenders on at least a pro rata basis pursuant to Clause 8.5 (Application of prepayments), to all the extent the creditors in respect of such Debt (including the Lenders) elect not to tender their Debt for such prepayment, repayment or some purchase, the Company will be deemed to have applied an amount of Net Available Cash equal to such amount not tendered under this paragraph (b), and such amount shall not increase the amount of Excess Proceeds.
(c) In the case of sub-paragraph (a)(iii)(B) above, on the 366th day (or such longer period permitted by paragraph (a) above) after the later of an Asset Disposition or the receipt of such Net Available Cash, , the Company will within ten (10) Business Days make an offer (an "Asset Disposition Offer") to each Lender under the Facility, and if required or permitted by the terms of any Debt, to the holders of other such Debt, to prepay the outstanding Senior Indebtedness that Facility (and only to the extent the Facility is Pari Passu Indebtednessoutstanding) held by any such Lender at par, and to purchase the maximum aggregate principal amount (or accreted value, as applicable) of Notes and any such other Senior Indebtedness Debt that may be purchased out of the Excess Proceeds, Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestoffer price required by the terms thereof, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in the agreement(s) governing such Debt.
(d) The Company may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition in the case of sub-paragraph (a)(iii)(B) above, by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant three hundred and sixty-five (365) days (or such longer period provided above) with respect to all or part of the Net Available Cash (the "Advance Portion") in advance of being required to do so by this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereofAgreement (an "Advance Offer").
(e) Other than in the case of sub-paragraph (a)(iii)(A) above, Clause 8.5 (Application of prepayments) shall apply to any prepayment of the Facility.
(f) If the aggregate principal amount (or accreted value, if applicable) of the Facility or other Debt elected to be repaid pursuant to sub-paragraph (a)(iii)(A) above, as the case may be, surrendered by such holders thereof exceeds the amount offered in the Asset Disposition Offer (or in the case of an Advance Offer, the Advance Portion), the Company shall repay the Facility and such Debt, as the case may be, on a pro rata basis based on the aggregate principal amount (or accreted value, if applicable) of the Facility offered to be repaid or such Debt, as the case may be, tendered with adjustments as necessary so that no Facility to be repaid or Debt, as the case may be, will be repurchased in part in an unauthorized denomination. Upon completion of any such Asset Disposition Offer (or Advance Offer), the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (0) (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries Company may use such Net Available Cash for any purpose not prohibited permitted by this IndentureAgreement. If 213 Project Meria: Senior Facilties Agreement
(g) To the extent that the aggregate amount (or accreted value, if applicable) of Notes outstanding Facility prepaid and such other Senior Indebtedness validly Debt, as the case may be, tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds is less than the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered offered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to or, in the beginning case of the Asset Disposition Offer Period. Upon completion of any Asset Disposition an Advance Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”Advance Portion), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries Company may satisfy the foregoing obligations with respect to use any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days remaining Excess Proceeds (or such longer period provided above) respect to all or part in the case of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05an Advance Offer, the Issuer will comply with the applicable securities laws and regulations and will Advance Portion) for any purposes not be deemed to have breached its obligations otherwise prohibited under this Indenture by virtue of such complianceAgreement.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Company, of the shares and assets disposed of as of the date of entry into binding documentation in respect of subject to such Asset Disposition (as determined by the Parent’s Board of Directors); andDisposition;
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash or cash equivalents; provided that the amount of (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded (as shown on the Parent’s, the Issuer’s Company's or such other Restricted Subsidiary’s 's most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Company or any Restricted Subsidiary (other than Subordinated Indebtednessliabilities that are by their terms subordinated to the Securities), as a result that are assumed by the transferee of which none of any such assets (provided that the Parent, the Issuer Company or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from all liability with respect thereto), (B) any guarantee notes, other obligations or securities received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of such Indebtedness as a result the cash received) within 180 days following the closing of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, Disposition and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(GC) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market value, when taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (C) of this paragraph (a) of this Section 4.07 that is at any one that time outstanding, not to exceed the greater $5.0 million at time of 15% receipt of Consolidated EBITDA and $150 million such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value), shall be deemed to be cash for purposes of this provision and for no other purpose; orand
(H3) any combination an amount equal to 100% of the types of consideration specified in Net Available Cash from such Asset Disposition is applied by the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days Company (or such period Restricted Subsidiary, as provided in clause the case may be)
(viiiA) belowto the extent the Company elects (or is required by the terms of any Indebtedness), if applicableto prepay, repay, redeem or purchase Senior Indebtedness or Indebtedness (other than any Disqualified Stock) of a Restricted Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Company) within one year from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash;
(B) to the extent the Company elects, to acquire Additional Assets within one year from the Parent later of the date of such Asset Disposition or its Restricted Subsidiaries may use the receipt of such Net Available Cash;
(C) to the extent of the balance of such Net Available Cash to:after application in accordance with clauses (A) and (B) of this paragraph (a)(3) of this Section 4.07, to make an offer to the holders of the Securities (and to holders of other Senior Subordinated Indebtedness designated by the Company) to purchase Securities (and such other Senior Subordinated Indebtedness) pursuant to and subject to the conditions contained in this Indenture; and
(iD) to the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) of this paragraph (a) prepayof this Section 4.07, repayfor any general corporate purpose permitted pursuant to the terms of this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or redeem (including through open market purchasesC) of this paragraph (a) of this Section 4.07, voluntary tender offers the Company or privately negotiated transactions at market pricessuch Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this paragraph (a) of this Section 4.07 the Company and the Restricted Subsidiaries will not be required to apply any Senior Indebtedness Incurred under Net Available Cash in accordance with this covenant except to the extent that the aggregate Net Available Cash from all Asset Dispositions which is not applied in accordance with this covenant exceeds $15.0 million. Pending application of Net Available Cash pursuant to this Section 4.01(b)(i); 4.07, such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily reduce revolving credit indebtedness.
(b) unless included in In the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for event of an Asset Disposition Offer, in such an amount as would reduce that requires the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor Securities (and other than Senior Subordinated Indebtedness) pursuant to clause (3)(C) of paragraph (a) of Section 4.07, the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) Company will purchase any series of Notes Securities tendered pursuant to an offer to all Holders by the Company for the Securities (and such other Senior Subordinated Indebtedness) (the "Offer") at a purchase price of 100% of their principal amount (or, in the event such other Senior Subordinated Indebtedness was issued with significant original issue discount, 100% of the accreted value thereof), without premium, plus accrued but unpaid interest (or, in respect of such series other Senior Subordinated Indebtedness, such lesser price, if any, as may be provided for by the terms of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricessuch Senior Subordinated Indebtedness) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures (including prorating in the event of oversubscription) set out below);
forth in paragraph (iiic) invest in any Replacement Assets;
(iv) acquire all or substantially all of Section 4.07. If the aggregate purchase price of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply securities tendered exceeds the Net Available Cash allotted to their purchase, the Company will select the securities to be purchased on a pro rata basis but in round denominations, which in the case of the Securities will be denominations of EURO 1,000 principal amount or multiples thereof. The Company shall not be required to make such an Offer to purchase Securities (and other Senior Subordinated Indebtedness) pursuant to this Section 4.05(b)(i4.07 if the Net Available Cash available therefor is less than $15.0 million (which lesser amount shall be carried forward for purposes of determining whether such an offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(1) Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall be obligated to deliver to the Trustee and send, by first-class mail to each Holder, and, as long as the Securities are listed on the Luxembourg Stock Exchange, publish in a Luxembourg newspaper of general circulation, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as hereinafter described in the event the Offer is oversubscribed) in integral multiples of EURO 1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum will include (i) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), Section 4.05(b)(iii(ii) a description of material developments in the Company's business subsequent to the date of the latest of such Reports, and (iii) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to the Offer, together with the information contained in clause (3).
(2) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided below, the Company shall deliver to the Trustee an Officers' Certificate as to (i) the amount of the Offer (the "Offer Amount"), Section 4.05(b)(iv), Section 4.05(b)(v(ii) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application the allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (iii) the compliance of such commitment until allocation with the earlier provisions of paragraph (xa) of Section 4.07. On such date, the date Company shall also 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, maturing on which such investment is consummatedthe last day prior to the Purchase Date or on the Purchase Date if funds are immediately available by open of business, and (y) an amount equal to the 180th day following Offer Amount to be held for payment in accordance with the provisions of this Section. Upon the expiration of the aforementioned 360-day periodperiod for which the Offer remains open (the "Offer Period"), if the investment has not Company shall deliver to the Trustee for cancellation the Securities or portions thereof which have been consummated properly tendered to and are to be accepted by the Company. The Trustee shall, on the Purchase Date, mail or deliver payment to each tendering Holder in the amount of the purchase price. In the event that datethe aggregate purchase price of the Securities delivered by the Company to the Trustee is less than the Offer Amount applicable to the Securities, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 4.07.
(c3) The Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a 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 and a statement that such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending Holder is withdrawing his election to have such Security purchased. If at the final application expiration of the Offer Period the aggregate principal amount of Securities (and any such Net Available Cashother Senior Subordinated Indebtedness included in the Offer) surrendered by holders thereof exceeds the Offer Amount, the Parent Company shall select the Securities and the other Senior Subordinated Indebtedness to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Securities and the other Senior Subordinated Indebtedness in denominations of EURO 1,000, or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize integral multiples thereof, shall be purchased). Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.
(4) At the time the Company delivers Securities to the Trustee which are to be accepted for purchase, the Company shall also deliver an Officers' Certificate stating that such Net Available Cash Securities are to be accepted by the Company pursuant to and in any manner that is not prohibited by accordance with the terms of this IndentureSection. A Security shall be deemed to have been accepted for purchase at the time the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer Company will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection 4.07. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.07, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 4.07 by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)securities laws or regulations.
Appears in 1 contract
Sources: Indenture (Gutbusters Pty LTD)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(ia) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition is not less than at least equal to the fair market value of the shares and assets disposed of subject to such Asset Disposition, as of such fair market value may be determined (and shall be determined, to the date of entry into binding documentation in respect of extent such Asset Disposition (as determined or any series of related Asset Dispositions involves aggregate consideration in excess of $50,000,000) in good faith by the Parent’s Board of Directors, whose determination shall be conclusive (including as to the value of all noncash consideration); and,
(iib) in the case of any Asset Disposition (or series of related Asset Dispositions) having a fair market value of $50,000,000 or more, at least 75% of the consideration therefor (excluding, in the Parent case of an Asset Disposition (or series of related Asset Dispositions), any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise, that are not Indebtedness) received by the Company or such Restricted Subsidiary receives is in respect the form of cash, and
(c) an amount equal to 100% of the Net Proceeds from such Asset Disposition consists of:
described in clause (Ab) cash is applied by the Company (including or any Net Restricted Subsidiary, as the case may be) in accordance with the requirements of Section 2.09(b)(iii): For the purposes of clause (ii) of paragraph (b) above, the following are deemed to be cash: (1) Temporary Cash Proceeds received Investments and Cash Equivalents, (2) the assumption of Indebtedness, other than Indebtedness that is by its terms subordinated to the Obligations, of the Company (other than Disqualified Stock of the Company) or any Restricted Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on payment of the conversion within 180 days principal amount of such Asset Disposition of securities, notes or other obligations received Indebtedness in consideration of connection with such Asset Disposition);
, (B3) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’sIndebtedness, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness)Indebtedness that is by its terms subordinated to the Obligations, as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of the principal amount of such Indebtedness in connection with such Asset Disposition, (i4) has been extinguished securities received by the Issuer Company or any Restricted Subsidiary from the applicable Guarantortransferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days, (5) Additional Assets and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G6) any Designated Non-Cash cash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in an Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant that is at any one time outstandingclause, not to exceed an aggregate amount at any time outstanding equal to the greater of 15$164,000,000 and 5.75% of Consolidated EBITDA and $150 million Tangible Assets (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Issuer shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i) the consideration the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (at least equal to the fair market value, as determined in good faith by the Parent’s Board of Directors); and, of the shares and assets subject to such Asset Disposition;
(ii) at least 75% of the consideration thereof received by the Parent Issuer or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash; PROVIDED that the following shall be deemed to be cash for purposes of this clause (A) cash ii): (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C1) the assumption by the purchaser amount of (x) any liabilities recorded (as shown on the Parent’sIssuer's, the Issuer’s or such other Restricted Subsidiary’s 's, most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any Restricted Subsidiary (other than liabilities that are by their terms subordinated to the Securities or the Guarantees) that are assumed by the transferee of any such assets, (2) the amount of any securities received by the Issuer or such Restricted Subsidiary from such transferee that are converted by the Issuer or such Restricted Subsidiary into cash (to the extent of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (ycash received) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result within 90 days following the closing of such Asset Disposition, if (3) the Parent, fair market value of any Telecommunications Assets received by the Issuer in such Asset Disposition and every other (4) the fair market value of any Permitted Joint Venture Interests received by the Issuer or any Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of in such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets ; PROVIDED that the aggregate fair market value of the kind referred all Permitted Joint Venture Interests received pursuant to in this clause (iv) or ), valued, in each case, at the time of receipt, shall not exceed 10% of Consolidated Net Tangible Assets (vi) for purposes of this Section 4.05(b4.06(a)(ii);, all determinations of fair market value shall be made in good faith by the Board of Directors and evidenced by an Officers' Certificate delivered to the Trustee); and
(Fiii) consideration consisting an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Issuer (or such Restricted Subsidiary, as the case may be):
(1) FIRST, to the extent the Issuer elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem, purchase or otherwise acquire Bank Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted a Wholly Owned Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 180 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash;
(2) SECOND, to the Parent or its Restricted Subsidiaries may use extent of the balance of Net Available Cash after application in accordance with clause (1) of this Section 4.06(a)(iii), to the extent the Issuer or such Restricted Subsidiary elects to:, or enters into a binding agreement to, reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with cash in an amount equal to the amount of Net Available Cash received by, or to be received by, the Issuer or another Restricted Subsidiary) within 180 days of the later of such Asset Disposition or the receipt of such Net Available Cash; and
(i3) THIRD, to the extent of the balance of such Net Available Cash after application in accordance with clauses (a1) prepayand (2) of this Section 4.06(a)(iii), repay, purchase or redeem to make an Offer (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); as defined in clause (b) unless included below) to purchase Securities pursuant to and subject to the conditions set forth in the preceding clause (i)(ab) below; PROVIDED, HOWEVER, that, if the Issuer elects (or is required by the terms of any other Senior Indebtedness), prepaysuch Offer may be made ratably to purchase the Securities and other Senior Indebtedness of the Issuer; PROVIDED, repayHOWEVER, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (1) or redeem (including through open market purchases3) of this Section 4.06(a)(iii), voluntary tender offers the Issuer or privately negotiated transactions such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Upon completion of any Offer, the amount of Net Available Cash shall be reset at market prices) any Pari Passu Indebtedness; provided that zero and the Parent, and its Restricted Subsidiaries Issuer shall be entitled to prepayuse any remaining proceeds for any corporate purposes to the extent permitted under this Indenture. Notwithstanding the foregoing provisions of this Section 4.06, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer and the Restricted Subsidiaries shall not be required to Holders to purchase Notes, apply any Net Available Cash in accordance with this Section 4.06(a) except to the provisions set forth below for extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 4.06(a) exceeds $10,000,000.
(b) In the event of an Asset Disposition Offerthat requires the purchase of Securities pursuant to clause (iii)(3) of Section 4.06(a), in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed shall be required to the Parent or any Restricted Subsidiary);
(ii) offer to purchase any series of Notes Securities tendered pursuant to an offer to all Holders by the Issuer for the Securities (an "Offer") at a purchase price of such series 100% of Notes, redeem their principal amount plus accrued and unpaid interest (including through open market purchasesadditional interest, voluntary tender offers or privately negotiated transactions at market pricesif any) any series of Notes pursuant thereon, to the redemption provisions date of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (purchase in accordance with the procedures (including prorating in the event of oversubscription) set out below);
forth in Section 4.06(c) and to purchase other Senior Indebtedness on the terms and to the extent contemplated thereby. The Issuer shall not be required to make an Offer for Securities (iiiand other Senior Indebtedness) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect pursuant to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply this Section 4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (iii)(1) and (iii)(2) of Section 4.06(a)) is less than $10,000,000 for any particular Asset Disposition (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(i) Promptly, and in any event within 10 days after the Issuer becomes obligated to make an Offer, the Issuer shall be obligated to deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Issuer either in whole or in part (subject to prorating as hereinafter described in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Issuer which the Issuer in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Issuer, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Issuer filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), (2) a description of material developments in the Issuer's business subsequent to the date of the latest of such reports, and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to Section 4.05(b)(ithe Offer, together with the address referred to in clause (iii).
(ii) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided above, the Issuer shall deliver to the Trustee an Officers' Certificate as to (1) the amount of the Offer (the "Offer Amount"), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v(2) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application the allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (3) the compliance of such commitment until allocation with the earlier provisions of Section 4.06(a). On such date, the Issuer shall also irrevocably deposit with the Trustee or with a paying agent (xor, if the Issuer is acting as its own paying agent, segregate and hold in trust) an amount equal to the date on which such investment is consummated, Offer Amount to be invested in Temporary Cash Investments and (y) to be held for payment in accordance with the 180th day following provisions of this Section 4.06. Upon the expiration of the aforementioned 360-day periodperiod for which the Offer remains open (the "Offer Period"), the Issuer shall deliver to the Trustee for cancelation the Securities or portions thereof that have been properly tendered to and are to be accepted by the Issuer. The Trustee (or the Paying Agent, if not the investment has not been consummated Trustee) shall, on the date of purchase, mail or deliver payment to each tendering Holder in the amount of the purchase price. In the event that the Offer Amount delivered by that datethe Issuer to the Trustee is greater than the purchase price of the Securities (and other Senior Indebtedness) tendered, the Trustee shall deliver the excess to the Issuer immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(ciii) The Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Issuer at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Issuer receives, not later than one Business Day 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 that was delivered by the Holder for purchase and a statement that such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending Holder is withdrawing his election to have such Security purchased. If at the final application expiration of the Offer Period the aggregate principal amount of Securities and any such Net Available Cashother Senior Indebtedness included in the Offer surrendered by holders thereof exceeds the Offer Amount, the Parent Issuer shall select the Securities and other Senior Indebtedness to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Issuer so that only Securities and other Senior Indebtedness in denominations of $1,000, or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize integral multiples thereof, shall be purchased). Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.
(iv) At the time the Issuer delivers Securities to the Trustee that are to be accepted for purchase, the Issuer shall also deliver an Officers' Certificate stating that such Net Available Cash Securities are to be accepted by the Issuer pursuant to and in any manner that is not prohibited by accordance with the terms of this IndentureSection 4.06. A Security shall be deemed to have been accepted for purchase at the time the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection 4.06. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.06, the Issuer will shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Acs Infosource Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); andthe assets or shares of Capital Stock issued or sold or otherwise disposed of;
(ii2) at least 75% of the consideration therefor received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists ofcash or Cash Equivalents or a combination thereof. For purposes of this Section 3.5, each of the following will be deemed to be cash:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of if such Asset Disposition does not involve Collateral, any liabilities, as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities, Indebtedness that is by its terms subordinated to the Securities or any Subsidiary Guarantee and liabilities to the extent owed to the Company or any Affiliate of the Company) that are assumed by the transferee of any such assets or shares of Capital Stock pursuant to a written novation agreement that releases the Company or such Restricted Subsidiary from further liability therefor;
(B) any secured Indebtedness, as shown on the Company’s or such Restricted Subsidiary’s most recent balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and Indebtedness to the extent owed to the Company or any Affiliate of the Company) that are assumed by the transferee of any such assets or shares of Capital Stock pursuant to a written novation agreement that releases the Company or such Restricted Subsidiary from further liability therefor (including with respect to providing any security for such Indebtedness); and
(C) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are (within 180 days of receipt) converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in consideration of that conversion); and
(3) if such Asset Disposition)Disposition involves the transfer of Collateral,
(A) such Asset Disposition complies with the applicable provisions of the Collateral Documents;
(B) to the extent required by the Collateral Documents, all consideration (including cash and Cash Equivalents;) received in such Asset Disposition shall be expressly made subject to Liens under the Collateral Documents; and
(C) subject to application of Net Available Cash pursuant to this Section 3.5 and the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date terms of the latest balance sheetCollateral Documents, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none all of the Parent, Net Available Cash from Asset Disposition of First Priority Collateral shall be deposited into the Issuer or Collateral Account and the Net Available Cash from Asset Disposition of Second Priority Collateral shall be applied in accordance with the Intercreditor Agreement.
(b) Within 365 days after the receipt of any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Net Available Cash from an Asset Disposition, if the Parent, the Issuer and every other Company or its Restricted Subsidiary is released from Subsidiaries may apply such Net Available Cash (or any guarantee of such Indebtedness as a result of such Asset Disposition;portion thereof) at its option:
(D1) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness Net Available Cash represents proceeds of First Priority Collateral, to repay, prepay, defease, redeem, purchase or otherwise retire Shared Collateral Debt (iother than the Securities and the Subsidiary Guarantees) has been extinguished by (and, in the Issuer or case of revolving loans and other similar obligations, permanently reduce the applicable Guarantorcommitment thereunder), and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having but only up to an aggregate fair market value, taken together with all other Designated Non-principal amount equal to such Net Available Cash Consideration received to be used to repay Indebtedness pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million clause (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H1) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parentmultiplied by a fraction, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) numerator of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as which is the aggregate principal amount of such other Pari Passu Indebtedness would to be reduced by repaid, prepaid, defeased, redeemed, purchased or otherwise retired and the denominator of which is the aggregate principal amount of all Shared Collateral Debt, based on amounts outstanding on the date of closing of such prepaymentsAsset Disposition; provided that the Company uses the remaining Net Available Cash to be used to repay Indebtedness pursuant to this clause (1) to make an offer to purchase (an “Asset Disposition Offer”) from the Holders, repaymentson a pro rata basis, purchases or redemptions; or an aggregate principal amount of Securities equal to such remaining Net Available Cash at a purchase price equal to 100% of the principal amount thereof, plus accrued interest and Additional Interest, if any, to the payment date;
(c2) to the extent that such Net Available Cash represents proceeds of Second Priority Collateral, to repay, prepay, repaydefease, redeem, purchase or redeem otherwise retire Indebtedness under the Revolving Credit Facility (including through open market purchasesand permanently reduce the commitment thereunder);
(3) to the extent that such Net Available Cash does not represent proceeds of Collateral, voluntary tender offers to repay, prepay, defease, redeem, purchase or privately negotiated transactions at market prices) any otherwise retire unsubordinated Indebtedness of the Company or any Subsidiary Guarantor in each case owing to a Person other than the Company or any Affiliate of the Company;
(4) in the case of an Asset Disposition by a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) Subsidiary Guarantor, to repay, prepay, defease, redeem, purchase or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated otherwise retire Indebtedness of such Restricted Subsidiary (and, in the Issuer or a Guarantor or Indebtedness owed to case of revolving loans and other similar obligations, permanently reduce the Parent or any Restricted Subsidiarycommitment thereunder);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii5) to purchase Additional Assets (or enter into a binding commitment agreement to apply purchase such Additional Assets; provided that (x) such purchase is consummated within 180 days after the date that is 365 days after the receipt of such Net Available Cash from such Asset Disposition and (y) if such purchase is not consummated within the period set forth in subclause (x), the Net Available Cash pursuant not so applied will be deemed to Section 4.05(b)(ibe Excess Proceeds (as defined below)); provided, Section 4.05(b)(iii)further, Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of to the extent that such Net Available Cash represents proceeds of Collateral, the Company or the applicable Subsidiary Guarantor will promptly grant to the Collateral Agent a security interest in such assets pursuant to and to the extent required by the Collateral Documents; provided that notwithstanding anything to the contrary in this Section 3.5, to the extent such Net Available Cash comes from the date an Asset Disposition of ▇▇▇▇▇▇▇ Medical’s assets in a single transaction or a series of related transactions and such Net Available Cash is in an amount in excess of $3.0 million, all of such commitment until Net Available Cash (not only the earlier amount in excess of (x$3.0 million) the date on which such investment is consummated, and (y) the 180th day following the expiration shall be promptly applied to repay or prepay Indebtedness of the aforementioned 360-day period, if the investment has not been consummated by that date▇▇▇▇▇▇▇ Medical.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent Company or any of the Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture; provided that any such investment of the Net Available Cash that represents proceeds of Collateral shall be in an account that is subject to a perfected security interest for the benefit of the holders of the Shared Collateral Debt.
(d) On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset DispositionDisposition (or, in the event that a binding agreement has been entered into as set forth in Section 3.5(b)(5), the later date of expiration of the 180-day period set forth in Section 3.5(b)(5) or such earlier time date, if any, as the Issuer electsCompany determines not to apply the Net Available Cash relating to such Asset Disposition as set forth in Section 3.5(b) (each such date being referred as an “Excess Proceeds Trigger Date”), if the such aggregate amount of Net Available Cash that has not been applied on or before the Excess Proceeds exceeds $60 million, the Issuer Trigger Date as permitted in Section 3.5(b) (“Excess Proceeds”) will be required within twenty (20) Business Days thereof applied by the Company to make an offer (“Asset Disposition Offer”) Offer to all Holders and, to (and if required by the extent the Issuer elects, to all or some holders terms of other outstanding Senior Indebtedness that is any Applicable Pari Passu Indebtedness, to the holders of such Applicable Pari Passu Indebtedness) to purchase the maximum principal amount of Notes Securities and any such other Senior Applicable Pari Passu Indebtedness that may be purchased out of the Excess Proceeds, at an . The offer price, price in respect of the Notes, any Asset Disposition Offer will be equal to no less than 100% of the principal amount thereof of the Securities and such other Applicable Pari Passu Indebtedness plus accrued and unpaid interestinterest and Additional Interest, if any, to, but not including, to the date of purchase. The Asset Disposition Offer in respect of Notes , and will be made payable in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereofcash.
(e) Upon completion The Company may defer the Asset Disposition Offer until the aggregate unutilized Excess Proceeds equals or exceeds $15.0 million, at which time the entire unutilized amount of Excess Proceeds (not only the amount in excess of $15.0 million) will be applied as provided in Section 3.5(d). If any such Excess Proceeds remain after consummation of an Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent Company and its Restricted Subsidiaries may use such Net Available Cash Excess Proceeds for any purpose not otherwise prohibited by this IndentureIndenture or any of the Collateral Documents. If the aggregate principal amount of Notes Securities and such other Senior Applicable Pari Passu Indebtedness validly tendered and not properly withdrawn pursuant to an in such Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes Securities and such other Senior Applicable Pari Passu Indebtedness will be purchased on a pro rata basis based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any Securities and such other Applicable Pari Passu Indebtedness tendered tendered, with such adjustments as may be needed so that only Securities in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall minimum amounts of $2,000 and integral multiples of $1,000 will be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Periodpurchased. Upon completion of any each Asset Disposition Offer, the amount of any remaining Excess Proceeds shall from such Asset Disposition will no longer be reset at zerodeemed to be Excess Proceeds.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, Company will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other securities laws or and regulations thereunder to the extent such laws and regulations are applicable in connection with the each repurchase of Notes Securities pursuant to this Indenturean Asset Disposition Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Disposition provisions of this Section 4.05Indenture, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Asset Disposition provisions of this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary of its Subsidiaries to, in one or a series of related transactions, consummate any an Asset Disposition unless:
Sale unless (i) the Company (or the Subsidiary, as the case may be) receives consideration at the Parent, time of such Asset Sale at least equal to the Issuer fair market value (as reasonably determined and evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or Equity Interests issued or sold or otherwise disposed of and (ii) at least 80% of the consideration therefor received by the Company or such Subsidiary is in the form of cash or Cash Equivalents, PROVIDED that for purposes of this provision, (x) the amount of (A) any liabilities (as shown on the most recent balance sheet of the Company or such Subsidiary or in the notes thereto) of the Company or such Subsidiary that are assumed by the transferee of any such assets (other Restricted than liabilities that are by their terms PARI PASSU with or subordinated to the Securities or the guarantee of the Guarantors, as applicable) and (B) any securities or other obligations received by the Company or any such Subsidiary receives for from such transferee that are immediately converted by the Company or such Subsidiary into cash or Cash Equivalents (or as to which the Company or such Subsidiary has received at or prior to the consummation of the Asset Sale a commitment (which may be subject to customary conditions) from a nationally recognized investment, merchant or commercial bank to convert into cash or Cash Equivalents within 90 days of the consummation of such Asset Disposition is not less than Sale and which are thereafter actually converted into cash or Cash Equivalents within such 90-day period) will be deemed to be cash or Cash Equivalents (and shall be deemed to be Net Proceeds for purposes of the following provisions as and when reduced to cash or Cash Equivalents) to the extent of the net cash or Cash Equivalents realized thereon and (y) the fair market value of the assets disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors); and
(ii) at least 75% of the consideration the Parent or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent Company or a Subsidiary in any Restricted Subsidiary having an Non-Qualified Asset Sale shall be deemed to be cash to the extent that the aggregate fair market value, taken together with value (as reasonably determined and evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to any subsequent changes in value); or
(H) any combination of received by the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer Company or any other Restricted Subsidiary consummates an of its Subsidiaries since the date of this Indenture in all Non-Qualified Asset Disposition, within 360 days (or such period Sales does not exceed 5% of Stockholders' Equity as provided in clause (viii) below, if applicable) of the later of the date of consummation such consummation. Notwithstanding the foregoing, to the extent the Company or any of its Subsidiaries receives Non-Cash Consideration as proceeds of an Asset Sale, such Asset Disposition Non-Cash Consideration shall be deemed to be Net Proceeds for purposes of (and shall be applied in accordance with) the following provisions when the Company or such Subsidiary receives cash or Cash Equivalents from a sale, repayment, exchange, redemption or retirement of or extraordinary dividend or return of capital on such Non-Cash Consideration. Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Company or such Subsidiary may apply such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
Proceeds (i) (a) prepay, repay, to purchase one or redeem (including through open market purchases, voluntary tender offers more Nursing Facilities or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included Related Businesses and/or a controlling interest in the preceding clause Capital Stock of a Person owning one or more Nursing Facilities and/or one or more Related Businesses (i)(aand no other material assets), prepay(ii) to make a capital expenditure or to acquire other tangible assets, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of business in which the foregoing; or
(viii) enter into a binding commitment Company is permitted to apply the Net Available Cash be engaged pursuant to Section 4.05(b)(i4.17 hereof or (iii) to permanently reduce Senior Debt (including, in the case of Senior Revolving Debt, to correspondingly reduce commitments with respect thereto), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” . Pending the final application of any such Net Available CashProceeds, the Parent Company or any Restricted such Subsidiary may temporarily reduce revolving credit borrowings Senior Revolving Debt. Any Net Proceeds from Asset Sales that are not applied or otherwise utilize such Net Available Cash invested as provided in any manner that is not prohibited by the terms first sentence of this Indentureparagraph will be deemed to constitute "Excess Proceeds.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if " When the aggregate amount of Excess Proceeds exceeds $60 25 million, the Issuer will be required within twenty (20) Business Days thereof Company shall make an offer to all Holders and holders of any other Indebtedness of the Company ranking senior to or on a parity with the Securities from time to time outstanding with similar provisions requiring the Company to make an offer (“to purchase or to redeem such Indebtedness with the proceeds from any Asset Disposition Offer”) to all Holders andSales, pro rata in proportion to the extent the Issuer electsrespective principal amounts (or, to all or some holders if applicable, accreted values of Indebtedness issued with an original issue discount) of Securities and such other Indebtedness then outstanding Senior Indebtedness that is Pari Passu Indebtedness(collectively, an "ASSET SALE OFFER") to purchase the maximum principal amount (or, if applicable, accreted values of Notes Indebtedness issued with an original discount) of the Securities and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestinterest thereon and Liquidated Damages, if any, to, but not including, to the date of purchase. The Asset Disposition Offer in respect of Notes will be made purchase (the "ASSET SALE PAYMENT"), in accordance with the procedures set forth in this IndentureSection 2.14. To the extent that the aggregate amount of (or, in minimum denominations if applicable, accreted values of $200,000 Indebtedness issued with an original issue discount) Securities and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such other Indebtedness tendered pursuant to an Asset Disposition OfferSale Offer is less than the Excess Proceeds, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose general corporate purposes not prohibited by at the time under this Indenture. If the aggregate principal amount of Notes Securities and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer surrendered by holders thereof exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes Securities and such other Senior Indebtedness will be purchased on a pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Periodbasis. Upon completion of any an Asset Disposition Sale Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Sun Healthcare Group Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition of Collateral unless:
(i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at least equal to the Fair Market Value (such Fair Market Value to be determined on the date of contractually agreeing to such Asset Disposition), as determined in good faith by the Company’s management, or if such Asset Disposition is not less than involves consideration in excess of $10.0 million, by a resolution of the fair market Board of Directors set forth in an Officers’ Certificate delivered to the Trustee (including as to the value of the assets disposed of as all non-cash consideration), of the date of entry into binding documentation in respect of Collateral subject to such Asset Disposition (as determined by the Parent’s Board of Directors); andDisposition;
(ii) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of cash or Cash Equivalents and 100% of the portion of the Net Proceeds from Asset Dispositions relating to the First Priority Collateral in excess of $5.0 million in the aggregate (to the extent not applied or invested as provided below) is deposited directly into the Collateral Account; and
(iii) the remaining consideration from such Asset Disposition consists of:
(A) that is not in the form of cash (including any Net or Cash Proceeds received from Equivalents is thereupon with its acquisition pledged as the conversion within 180 days First Priority Collateral to secure the Notes, in the case of such an Asset Disposition of the First Priority Collateral, or as ABL Collateral, in the case of an Asset Disposition of ABL Collateral. For purposes of clause (ii) of the preceding paragraph, the following shall be deemed to be cash: (a) the repayment or assumption of Indebtedness secured by Liens with a priority to the Liens in favor of the Notes and the Note Guarantees and (b) any securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are, within 180 days of the disposition of Collateral, converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, to the extent of the cash or Cash Equivalents (of the variety described in consideration clauses (1) through (7) of the definition thereof) received in that conversion. Any Net Proceeds deposited into the Collateral Account from any Asset Dispositions of First Priority Collateral may be withdrawn to be invested by the Company or a Guarantor in Additional Assets constituting First Priority Collateral (including, without limitation, through capital expenditures in domestic assets constituting First Priority Collateral) within 360 days of the date of such Asset Disposition, which Additional Assets are thereupon with their acquisition added to the First Priority Collateral securing the Notes; provided that Additional Assets shall not include the Capital Stock of Foreign Subsidiaries for purposes of this requirement unless the relevant Asset Disposition consisted of the sale of the Capital Stock of a Foreign Subsidiary. All of the Net Proceeds received from any Recovery Event in respect of First Priority Collateral shall be deposited directly into the Collateral Account and may be withdrawn to be invested by the Company or a Guarantor in Additional Assets constituting First Priority Collateral (which may include performance of a restoration of the affected Collateral) within 360 days of the date of such Recovery Event, which Additional Assets are thereupon with their acquisition added to the First Priority Collateral securing the Notes; provided that (x) the Company shall not be required to deposit in the Collateral Account the Net Proceeds in an aggregate amount of $5.0 million or less and (y) Additional Assets shall not include the Capital Stock of Foreign Subsidiaries for purposes of this requirement. The Company and the Guarantors shall not reinvest the proceeds of Asset Dispositions of ABL Collateral in the Capital Stock of Foreign Subsidiaries. Any Net Proceeds from Asset Dispositions of Collateral or Recovery Events that are not applied or invested as provided in this subsection (a) or in accordance with the Collateral Documents will be deemed to constitute “Excess Collateral Proceeds.” On or before the 361st day after an Asset Disposition or Recovery Event pursuant to this subsection (a), if the aggregate amount of Excess Collateral Proceeds exceeds $10.0 million, the Company will be required to make an offer (“Collateral Disposition Offer”) to all Holders of Notes and all holders of other Pari Passu Lien Indebtedness containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of Collateral to purchase the maximum principal amount of the Notes and such Pari Passu Lien Indebtedness (on a pro rata basis) to which the Collateral Disposition Offer applies that may be purchased out of the Excess Collateral Proceeds, at an offer price in cash in an amount equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest to the date of purchase, in accordance with the procedures set forth in this Indenture in integral multiples of $1,000; provided that no Notes of $2,000 or less can be repurchased in part; provided, further, that to the extent the Excess Collateral Proceeds relate to Asset Dispositions of ABL Collateral, the Company may, prior to making a Collateral Disposition Offer, make a prepayment with respect to the maximum principal amount of Indebtedness that is secured by such Collateral on a first-priority basis that may be prepaid out of such Excess Collateral Proceeds, at a price in cash in an amount equal to 100% of the principal amount of such Indebtedness, plus accrued and unpaid interest, to the date of prepayment, with any Excess Collateral Proceeds not used to prepay such Indebtedness offered to Holders in accordance with this paragraph. To the extent that the aggregate amount of Notes and other Pari Passu Lien Indebtedness so validly tendered and not properly withdrawn pursuant to a Collateral Disposition Offer is less than the Excess Collateral Proceeds (after giving effect to the prepayment of Indebtedness secured on a first-priority basis in the case of an Asset Disposition of ABL Collateral), the Company may use any remaining Excess Collateral Proceeds for general corporate purposes, subject to the other covenants contained in this Indenture. If the aggregate principal amount of Notes surrendered by Holders and Pari Passu Lien Indebtedness tendered into such Collateral Disposition Offer exceeds the amount of Excess Collateral Proceeds, the Notes and Pari Passu Lien Indebtedness to be purchased shall be selected on a pro rata basis. Upon completion of such Collateral Disposition Offer, the amount of Excess Collateral Proceeds shall be reset at zero.
(b) The Company will not, and will not permit any Restricted Subsidiary to, make any Asset Disposition (other than Asset Dispositions of Collateral which shall be treated in the manner set forth in paragraph (a) above) unless:
(1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the time of the Asset Disposition at least equal to the Fair Market Value of the assets or Equity Interests issued or sold or otherwise disposed of;
(B2) at least 75% of the consideration received in the Asset Disposition by the Company or such Restricted Subsidiary is in the form of cash. For purposes of this provision, each of the following will be deemed to be cash:
(a) Cash Equivalents;
(C) the assumption by the purchaser of (xb) any liabilities recorded liabilities, as shown on the Parent’s, the IssuerCompany’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest most recent consolidated balance sheet, that would be recorded on of the next balance sheet) Company or any Restricted Subsidiary (other than Subordinated Indebtedness)contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Note Guarantee) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary from further liability;
(c) any securities, as a result of which none notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are, within 180 days of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if converted by the Parent, the Issuer and every other Company or such Restricted Subsidiary is released from any guarantee into cash or Cash Equivalents, to the extent of such Indebtedness as a result the cash or Cash Equivalents (of such Asset Disposition;the variety described in clauses (1) through (7) of the definition thereof) received in that conversion; and
(D) Replacement Assets;
(Ed) any Capital Stock stock or assets of the kind referred to in clause clauses (iv2) or (vi4) of the next paragraph of this Section 4.05(b3.5. Within 360 days after the receipt of any Net Proceeds from an Asset Disposition subject to this Section 3.5(b), the Company (or the applicable Restricted Subsidiary, as the case may be) may apply such Net Proceeds at its option:
(1) to repay Senior Debt (and to correspondingly reduce commitments with respect thereto) and Indebtedness of the applicable Restricted Subsidiary of the Company (if such Restricted Subsidiary is not a Guarantor);
(F2) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Permitted Business, if, after giving effect to any such acquisition of Capital Stock, such Person the Permitted Business is or becomes a Restricted SubsidiarySubsidiary of the Company;
(v3) to make a capital expenditure;; or
(vi4) to acquire other assets (other than Capital Stock that are not classified as current assets under GAAP and cash or Cash Equivalents) that are used or useful in a Similar Permitted Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” . Pending the final application of any such Net Available CashProceeds, the Parent or any Restricted Subsidiary Company may temporarily reduce revolving credit borrowings or otherwise utilize such invest the Net Available Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. Any Net Proceeds from Asset Dispositions that are not applied or invested as provided above will constitute “Excess Proceeds.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if ” When the aggregate amount of Excess Proceeds exceeds $60 15.0 million, within 15 days thereof, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to and all or some holders of other outstanding Senior Indebtedness that is pari passu with the Notes (“Pari Passu Indebtedness, ”) containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets to purchase the maximum principal amount of Notes and any such other Senior Pari Passu Indebtedness that may be purchased out of the Excess Proceeds, at an . The offer price, price in respect of the Notes, any Asset Disposition Offer will be equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestinterest and Special Interest, if any, to, but not including, to the date of purchase. The Asset Disposition Offer in respect of Notes , and will be made payable in accordance with the procedures set forth in this Indenture, in minimum denominations cash. If any Excess Proceeds remain after consummation of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such an Asset Disposition Offer, the amount of Company may use those Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and other Pari Passu Indebtedness tendered into such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among Trustee will select the tendering Holders of Notes and such other Senior Pari Passu Indebtedness to be purchased on a pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Periodbasis. Upon completion of any each Asset Disposition Offer, the amount of Excess Proceeds shall will be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(gc) The Collateral Disposition Offer or Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior (and other Indebtedness required to be repaid or purchased by it pursuant to such offer the last paragraph of Section 3.5(a)) and Pari Passu Indebtedness required to be purchased pursuant to this Section 3.5 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes (and Senior other Indebtedness that is required to be purchased pursuant to the last paragraph of Section 3.5(a)) and Pari Passu Indebtedness Indebtedness, if applicable, validly tendered in response to the Collateral Disposition Offer or Asset Disposition Offer., as applicable. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest will be paid on such Asset Disposition Purchase Date to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender notes pursuant to the Collateral Disposition Offer or Asset Disposition Offer. Upon the commencement of a Collateral Disposition Offer or Asset Disposition Offer, as applicable, the Company will send, by first class mail, a notice to the Trustee and each of the Holders of the Notes. The notice will contain all instructions and materials necessary to enable such Holders to tender Notes pursuant to the Collateral Disposition Offer or Asset Disposition Offer, as applicable. The notice, which will govern the terms of the Collateral Disposition Offer or Asset Disposition Offer, as applicable, will state:
(h1) The Parent and its Restricted Subsidiaries may satisfy that the foregoing obligations with respect to any Net Available Cash from an Asset Collateral Disposition by making an Offer or Asset Disposition Offer is being made pursuant to this Section 3.5 and the length of time the Collateral Disposition Offer or Asset Disposition Offer will remain open;
(2) the Asset Disposition Offer Amount, the purchase price and the Asset Disposition Purchase Date;
(3) that any Security not tendered or accepted for payment will continue to accrue interest;
(4) that, unless the Company defaults in making such payment, any Note accepted for payment pursuant to the Collateral Disposition Offer or Asset Disposition Offer will cease to accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to a Collateral Disposition Offer or Asset Disposition Offer, as applicable, may elect to have Notes purchased in denominations of $2,000 or integral multiples of $1,000 in excess thereof only;
(6) that Holders electing to have a Note purchased pursuant to any Collateral Disposition Offer or Asset Disposition Offer, as applicable, will be required to surrender the Note, with respect the form entitled “Option of Holder to Elect Purchase” attached to the Note completed, or transfer its interest in such Net Available Cash prior Security by book-entry transfer, to the Company or a Paying Agent at the address specified in the notice at least three Business Days before the Asset Disposition Purchase Date;
(7) that Holders will be entitled to withdraw their election if the Company or the Paying Agent, as the case may be, receives, not later than the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived Period, a telegram, telex, facsimile transmission or modified with letter setting forth the consent name of Holders of a majority in outstanding the Holder, the principal amount of the Notes Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(with such consent8) that, for the avoidance of doubt, to be considered effective if the aggregate principal amount of Notes and, if applicable, other Indebtedness required to be purchased pursuant to the last paragraph of Section 3.5(a) and other Pari Passu Indebtedness surrendered by the Holders thereof exceeds the Asset Disposition Offer Amount, the Company will select the Notes of consenting Holders represents and, if applicable, such other Indebtedness and Pari Passu Indebtedness to be purchased on a majority of pro rata basis based on the aggregate outstanding principal amount of Securities and such other Indebtedness and Pari Passu Indebtedness surrendered (with such adjustments as may be deemed appropriate so that only Notes in denominations of $2,000, or integral multiples of $1,000 in excess thereof, will be purchased); and
(9) that Holders whose Notes were purchased only in part will be issued new Notes equal in principal amount to the unpurchased portion of the Notes as a whole surrendered (or transferred by book-entry transfer). If the Asset Disposition Purchase Date is on or after an interest record date and without regard on or before the related interest payment date, any accrued and unpaid interest will be paid on such Asset Disposition Purchase Date to the level Person in whose name a Note is registered at the close of consent obtained among business on such record date, and no additional interest will be payable to Holders who tender Securities pursuant to the Collateral Disposition Offer or Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of each constituent series of Notes).Notes (and other Indebtedne
Appears in 1 contract
Sources: Indenture (Easton-Bell Sports, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Company, of the shares and assets disposed of as of the date of entry into binding documentation in respect of subject to such Asset Disposition (as determined by the Parent’s Board of Directors); andDisposition;
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash or cash equivalents; provided, however, that the amount of (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded (as shown on the Parent’s, the Issuer’s Company's or such other Restricted Subsidiary’s 's most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Company or any Restricted Subsidiary (other than Subordinated Indebtedness)liabilities that are by their terms subordinated to the Securities) that are assumed by the transferee of any such assets (provided, as a result of which none of however, that the Parent, the Issuer Company or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from all liability with respect thereto), (B) any guarantee notes, other obligations or securities received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of such Indebtedness as a result the cash received) within 180 days following the closing of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(GDisposition,(C) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market value, when taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (C) that is at any one that time outstanding, not to exceed the greater $10 million at time of 15% receipt of Consolidated EBITDA and $150 million such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value)value)and (D) any real property or improvements received in exchange for real property or improvements having a comparable market value as determined in good faith by the Board of Directors, 64 55 shall be deemed to be cash for purposes of this provision and for no other purpose; orand
(H3) any combination an amount equal to 100% of the types of consideration specified in Net Available Cash from such Asset Disposition is applied by the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days Company (or such period Restricted Subsidiary, as provided in clause the case may be) (viiiA) belowfirst, if applicableto the extent the Company elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem or purchase Senior Indebtedness or Indebtedness (other than any Disqualified Stock) of a Restricted Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Company) within one year from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; (B) second, to the Parent extent the Company elects, to acquire Additional Assets within one year from the later of the date of such Asset Disposition or its Restricted Subsidiaries may use the receipt of such Net Available Cash; (C) third, to the extent of the balance of such Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, after application in accordance with clauses (A) and (B), to make an Offer to the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary holders of the Parent that is not a Guarantor Securities (and to holders of other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Senior Subordinated Indebtedness of the Issuer or a Guarantor or Company designated by the Company) to purchase Securities (and such other Senior Subordinated Indebtedness owed of the Company) pursuant to and subject to the Parent conditions of Section 4.06(b); and (D) fourth, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C), for any general corporate purpose permitted pursuant to the terms of the Indenture; provided, however, that in connection with any prepayment, repayment or any purchase of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary);Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased.
(iia) except to the extent that the aggregate Net Available Cash from all Asset Dispositions which is not applied in accordance with this Section 4.06(a) exceeds $15 million. Pending application of Net Available Cash pursuant to this Section 4.06(a), such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily reduce revolving credit indebtedness. 65 56
(b) In the event of an Asset Disposition that requires the purchase any series of Notes the Securities (and other Senior Subordinated Indebtedness of the Company) pursuant to Section 4.06(a)(3)(C), the Company will purchase Securities tendered pursuant to an offer to all Holders by the Company for the Securities (and such other Senior Subordinated Indebtedness) (the "Offer") at a purchase price of 100% of their principal amount (or, in the event such other Senior Subordinated Indebtedness of the Company was issued with significant original issue discount, 100% of the accreted value thereof), without premium, plus accrued but unpaid interest (or, in respect of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders other Senior Subordinated Indebtedness of the Notes (Company, such lesser price, if any, as may be provided for by the terms of such Senior Subordinated Indebtedness) in accordance with the procedures (including prorating in the event of over subscription) set out belowforth in Section 4.06(c);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all . If the aggregate purchase price of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply securities tendered exceeds the Net Available Cash allotted to their purchase, the Company shall select the securities to be purchased on a pro rata basis but in round denominations, which in the case of the Securities will be denominations of $1,000 principal amount or multiples thereof. The Company shall not be required to make such an Offer to purchase Securities (and other Senior Subordinated Indebtedness of the Company) pursuant to this Section 4.05(b)(i4.06 if the Net Available Cash available therefor is less than $15 million (which lesser amount shall be carried forward for purposes of determining whether such an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(1) Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as described in Section 4.06(b) in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum will include (A) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports 66 57 describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), Section 4.05(b)(iii(B) a description of material developments in the Company's business subsequent to the date of the latest of such Reports, and (C) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to the Offer, together with the information contained in clause (3).
(2) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided below, the Company shall deliver to the Trustee an Officers' Certificate as to (A) the amount of the Offer (the "Offer Amount"), Section 4.05(b)(iv)including information as to any other Senior Indebtedness Subordinated Indebtedness included in the Offer, Section 4.05(b)(v(B) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application the allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (C) the compliance of such commitment until allocation with the earlier provisions of (xSection 4.06(a) the date on which such investment is consummated, and (yb). On such date, the Company shall also 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, maturing on the 180th last day following prior to the Purchase Date or on the Purchase Date if funds are immediately available by open of business, an amount equal to the Offer Amount to be held for payment in accordance with the provisions of this Section. If the Offer includes other Senior Subordinated Indebtedness, the deposit described in the preceding sentence may be made with any other paying agent pursuant to arrangements satisfactory to the Trustee. Upon the expiration of the aforementioned 360-day periodperiod for which the Offer remains open (the "Offer Period"), if the investment has not Company shall deliver to the Trustee for cancellation the Securities or portions thereof which have been consummated properly tendered to and are to be accepted by the Company. The Trustee shall, on the Purchase Date, mail or deliver payment (or cause the delivery of payment) to each tendering Holder in the amount of the purchase price. In the event that datethe aggregate purchase price of the Securities delivered by the Company to the Trustee is less than the Offer Amount applicable to the Securities, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(c3) The Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to the Company at the 67 58 address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a 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 and a statement that such Net Available Cash not so used as set forth above constitutes “Excess ProceedsHolder is withdrawing his election to have such Security purchased. Holders whose Securities are purchased only in part shall be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.” Pending
(4) At the final application of any such Net Available Cashtime the Company delivers Securities to the Trustee which are to be accepted for purchase, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize Company shall also deliver an Officers' Certificate stating that such Net Available Cash Securities are to be accepted by the Company pursuant to and in any manner that is not prohibited by accordance with the terms of this IndentureSection. A Security shall be deemed to have been accepted for purchase at the time the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer Company shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Section, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)securities laws or regulations.
Appears in 1 contract
Sources: Indenture (Travelcenters Realty Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); andthe shares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in the form of cash, Temporary Cash Investments, assets useful in a Permitted Business or Permitted Securities; provided, that the amount of any Designated Noncash Consideration received by the Company or any of its Restricted Subsidiaries in such Asset Disposition shall be deemed to be cash for the purposes of this provision (but for no other purpose) so long as such amount, taken together with the Fair Market Value when received of all other Designated Noncash Consideration that is at that time outstanding
(i. e., that has not been sold for or otherwise converted into cash or Permitted Securities), does not exceed $50.0 million; provided, further, that with respect to the sale of one or more properties, up to 75% of the consideration may consist of Indebtedness of the purchaser of such properties so long as such Indebtedness is secured by a first priority Lien on the properties sold; and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) within 540 days after the later of the date of such Asset Disposition consists ofand the receipt of such Net Available Cash:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiesto prepay, notes repay, purchase, repurchase, redeem, retire, defease or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date otherwise acquire for value Secured Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as Company or a result of which none of the Parent, the Issuer Subsidiary Guarantor or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer not a Subsidiary Guarantor, in each case other than Indebtedness owed to the Company or an Affiliate of the Company;
(B) to reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-with Net Available Cash Consideration received by the Parent Company or any another Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any Subsidiary) or make one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value)or more capital expenditures; or
(HC) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase to redeem the Notes or redeem (including through make open market purchases, voluntary tender offers or privately negotiated transactions purchases thereof at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is price not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
or (eii) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Sale Offer shall be reset to zero purchase Notes pursuant to and subject to the conditions set forth in paragraph (regardless b) of whether there are any remaining Excess Proceeds upon such completion). Upon consummation this Section 4.10; provided, however, that if the Company elects (or expiration is required by the terms of any Pari Passu Indebtedness), such Asset Disposition Offer, Sale Offer may be made ratably (determined based upon the respective principal amounts of the Notes and such Pari Passu Indebtedness being purchased or repaid) to purchase the Notes and to purchase or otherwise repay such Pari Passu Indebtedness; provided that pending final application of any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for in accordance with clause (A), (B) or (C) above, the Company and the Restricted Subsidiaries may temporarily reduce revolving Indebtedness outstanding under the Credit Agreement or otherwise invest such Net Available Cash in any purpose manner not prohibited by this Indenture. If To the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) above, the Company or such Restricted Subsidiary, as the case may be, may use such balance for any general corporate purpose not prohibited by the terms of this Indenture. In connection with any prepayment, repayment, purchase, repurchase, redemption, retirement, defeasance or other acquisition for value of Indebtedness pursuant to clause (A) or (C) above, the Company or such Restricted Subsidiary, as the case may be, will retire such Indebtedness and will cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid, purchased, repurchased, redeemed, retired, defeased or otherwise acquired for value. Notwithstanding the foregoing provisions of this Section 4.10, the Company and the Restricted Subsidiaries will not be required to apply any Net Available Cash in accordance with this covenant except to the extent that the aggregate amount of Notes and such other Senior Indebtedness validly tendered and Net Available Cash from all Asset Dispositions that is not properly withdrawn pursuant to an Asset Disposition Offer applied in accordance with this covenant exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn$50.0 million. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offerthis Section 4.10, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes following are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required deemed to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).cash:
Appears in 1 contract
Sources: Indenture (Orbital Atk, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary of its Subsidiaries to, in one or a series of related transactions, consummate any an Asset Disposition unless:
Sale unless (i) the Company (or the Subsidiary, as the case may be) receives consideration at the Parent, time of such Asset Sale at least equal to the Issuer fair market value (as reasonably determined and evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of the assets or Equity Interests issued or sold or otherwise disposed of and (ii) at least 80% of the consideration therefor received by the Company or such Subsidiary is in the form of cash or Cash Equivalents, PROVIDED that for purposes of this provision, (x) the amount of (A) any liabilities (as shown on the most recent balance sheet of the Company or such Subsidiary or in the notes thereto) of the Company or such Subsidiary that are assumed by the transferee of any such assets (other Restricted than liabilities that are by their terms PARI PASSU with or subordinated to the Securities or the guarantee of the Guarantors, as applicable) and (B) any securities or other obligations received by the Company or any such Subsidiary receives for from such transferee that are immediately converted by the Company or such Subsidiary into cash or Cash Equivalents (or as to which the Company or such Subsidiary has received at or prior to the consummation of the Asset Sale a commitment (which may be subject to customary conditions) from a nationally recognized investment, merchant or commercial bank to convert into cash or Cash Equivalents within 90 days of the consummation of such Asset Disposition is not less than Sale and which are thereafter actually converted into cash or Cash Equivalents within such 90-day period) will be deemed to be cash or Cash Equivalents (and shall be deemed to be Net Proceeds for purposes of the following provisions as and when reduced to cash or Cash Equivalents) to the extent of the net cash or Cash Equivalents realized thereon and (y) the fair market value of the assets disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors); and
(ii) at least 75% of the consideration the Parent or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent Company or a Subsidiary in any Restricted Subsidiary having an Non-Qualified Asset Sale shall be deemed to be cash to the extent that the aggregate fair market value, taken together with value (as reasonably determined and evidenced by a resolution of the Board of Directors set forth in an Officers' Certificate delivered to the Trustee) of all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to any subsequent changes in value); or
(H) any combination of received by the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer Company or any other Restricted Subsidiary consummates an of its Subsidiaries since the date of this Indenture in all Non-Qualified Asset Disposition, within 360 days (or such period Sales does not exceed 5% of Stockholders' Equity as provided in clause (viii) below, if applicable) of the later of the date of consummation such consummation. Notwithstanding the foregoing, to the extent the Company or any of its Subsidiaries receives Non-Cash Consideration as proceeds of an Asset Sale, such Asset Disposition Non-Cash Consideration shall be deemed to be Net Proceeds for purposes of (and shall be applied in accordance with) the following provisions when the Company or such Subsidiary receives cash or Cash Equivalents from a sale, repayment, exchange, redemption or retirement of or extraordinary dividend or return of capital on such Non-Cash Consideration. Within 365 days after the receipt of any Net Proceeds from an Asset Sale, the Company or such Subsidiary may apply such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
Proceeds (i) (a) prepay, repay, to purchase one or redeem (including through open market purchases, voluntary tender offers more Nursing Facilities or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included Related Businesses and/or a controlling interest in the preceding clause Capital Stock of a Person owning one or more Nursing Facilities and/or one or more Related Businesses (i)(aand no other material assets), prepay(ii) to make a capital expenditure or to acquire other tangible assets, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of business in which the foregoing; or
(viii) enter into a binding commitment Company is permitted to apply the Net Available Cash be engaged pursuant to Section 4.05(b)(i4.17 hereof or (iii) to permanently reduce Senior Debt (including, in the case of Senior Revolving Debt, to correspondingly reduce commitments with respect thereto), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” . Pending the final application of any such Net Available CashProceeds, the Parent Company or any Restricted such Subsidiary may temporarily reduce revolving credit borrowings Senior Revolving Debt. Any Net Proceeds from Asset Sales that are not applied or otherwise utilize such Net Available Cash invested as provided in any manner that is not prohibited by the terms first sentence of this Indentureparagraph will be deemed to constitute "Excess Proceeds.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if " When the aggregate amount of Excess Proceeds exceeds $60 25 million, the Issuer will be required within twenty (20) Business Days thereof Company shall make an offer to all Holders and holders of any other Indebtedness of the Company ranking senior to or on a parity with the Securities from time to time outstanding with similar provisions requiring the Company to make an offer (“to purchase or to redeem such Indebtedness with the proceeds from any Asset Disposition Offer”) to all Holders andSales, pro rata in proportion to the extent the Issuer electsrespective principal amounts of Securities and such other Indebtedness then outstanding (collectively, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, an "ASSET SALE OFFER") to purchase the maximum principal amount of Notes the Securities and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestinterest thereon and Liquidated Damages, if any, to, but not including, to the date of purchase. The Asset Disposition Offer in respect of Notes will be made purchase (the "ASSET SALE PAYMENT"), in accordance with the procedures set forth in this Indenture, in minimum denominations Section 2.14. To the extent that the aggregate amount of $200,000 Securities and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such other Indebtedness tendered pursuant to an Asset Disposition OfferSale Offer is less than the Excess Proceeds, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose general corporate purposes not prohibited by at the time under this Indenture. If the aggregate principal amount of Notes Securities and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer surrendered by holders thereof exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes Securities and such other Senior Indebtedness will be purchased on a pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Periodbasis. Upon completion of any an Asset Disposition Sale Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Sun Healthcare Group Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Holdings shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Holdings or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); and
the shares and assets subject to such Asset Disposition, (ii) at least 75% of the consideration the Parent therefor received by Holdings or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash; provided that the following shall be deemed to be cash for purposes of this clause (Aii) cash (including any but not for purposes of the definition of Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
Available Cash): (B) Cash Equivalents;
(C1) the assumption by the purchaser amount of (x) any liabilities recorded (as shown on the Parent’s, the Issuer’s Holdings' or such other Restricted Subsidiary’s 's most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Holdings or any Restricted Subsidiary (other than Subordinated Indebtedness)liabilities that are by their terms subordinated to the Notes) that are assumed by the transferee of any such assets, as a result (2) the amount of which none any securities received by Holdings or such Restricted Subsidiary from such transferee that are converted or scheduled to be converted by Holdings or such Restricted Subsidiary into cash (to the extent of the Parent, cash received or scheduled to be received) within 90 days following the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result closing of such Asset Disposition, if (3) the Parent, the Issuer and every other Restricted Subsidiary is released from Fair Market Value of any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration Related Assets received by the Parent Holdings or any Restricted Subsidiary in such Asset Disposition and (4) any Designated Noncash Consideration received by Holdings or such Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (4) that is at any one time outstandinghas not been converted into cash or cash equivalents, not to exceed the greater of 1510% of Consolidated EBITDA and $150 million Net Tangible Assets as of the end of the most recent fiscal quarter for which financial statements are publicly available or are otherwise provided pursuant to the Purchase Agreement at the time such Designated Noncash Consideration is received (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
and (Hiii) any combination an amount equal to 100% of the types Net Available Cash from such Asset Disposition is applied by Holdings (or such Restricted Subsidiary, as the case may be) (1) first, to the extent Holdings elects (or is required by the terms of consideration specified any Indebtedness), to prepay, repay, redeem, purchase, repurchase, defease or otherwise acquire or retire for value Indebtedness (other than obligations in the preceding clauses respect of any Preferred Stock) of a Wholly Owned Subsidiary (ii)(Ain each case, other than Indebtedness owed to Holdings or an Affiliate of Holdings and other than obligations in respect of any Disqualified Stock) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; (2) second, to the Parent or its Restricted Subsidiaries may use extent of the balance of Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, after application in accordance with clause (1) of this Section 4.06(a)(iii), to the provisions set forth below for an Asset Disposition Offerextent Holdings or such Restricted Subsidiary elects to, or enters into a binding agreement to, reinvest in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem Additional Assets (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness by means of an Investment in Additional Assets by a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (with cash in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed an amount equal to the Parent or any Restricted Subsidiary);
(ii) purchase any series amount of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant received by, or to Section 4.05(b)(i)be received by, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(vHoldings or another Restricted Subsidiary) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application within 360 days of the later of such Asset Disposition or the receipt of such Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, Cash; and (y3) third, to the 180th day following the expiration extent of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount balance of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final after application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms accordance with clauses (1) and (2) of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition4.06(a)(iii), or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, Offer to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).subject to
Appears in 1 contract
Sources: Indenture (Maxxim Medical Inc/Tx)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is consideration (both cash and non cash) equal to not less than the fair market value of the assets disposed of as of Fair Market Value (such Fair Market Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andshares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents or Replacement Assets. For purposes of this clause (2), each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the face of the Company’s or such Restricted Subsidiary’s then most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and Subordinated Obligations) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:from further liability;
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in consideration that conversion) within 180 days of the closing of such Asset Disposition);; and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gc) any Designated Non-Cash Noncash Consideration received by the Parent Company or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value (as determined in good faith by the Board of Directors of the Company), taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (c) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 100.0 million (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); orand
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant3) an offer amount equal to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition:
(a) first, is applied by the Company or such Restricted Subsidiary, as the case may be,
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Bank Indebtedness) to prepay, repay or purchase such Bank Indebtedness of the Company or of a Restricted Subsidiary within 365 days from the date of such commitment until the earlier of Asset Disposition (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of “Application Period”), unless to the extent such Net Available Cash not is otherwise used in accordance with clause (ii); provided, however, that, in connection with any prepayment, repayment or purchase of any such Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so used prepaid, repaid or purchased, or
(ii) to the extent the Company or any Restricted Subsidiary, as the case may be, elects, to invest in Replacement Assets within the applicable Application Period; and
(b) second, to the extent of the balance of the Net Available Cash after application in accordance with (a) above (such balance, “Excess Proceeds”), is applied by the Company or such Restricted Subsidiary, as the case may be, toward an offer to purchase Notes as set forth above constitutes “Excess Proceeds.” Pending in the next succeeding paragraph; provided, however, that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) . On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time date, if any, as the Issuer electsBoard of Directors of the Company or such Restricted Subsidiary determines that the Net Available Cash will not be applied in accordance with clause (3)(a) of the first paragraph of this Section 4.15), if the aggregate amount of Excess Proceeds exceeds $60 50.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders of Notes and, to the extent required by the Issuer electsterms of other Senior Indebtedness, to all or some holders of other outstanding Senior Indebtedness that is outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Indebtedness with the proceeds from any Asset Disposition (“Pari Passu Indebtedness, Notes”) to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indentureherein or the agreements governing the Pari Passu Notes, as applicable, in minimum denominations of $200,000 and each case in integral multiples of $1,000 in excess thereof.
principal amount (e) Upon completion provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such Asset Disposition Offer, other integral multiples as may be specified in the agreements governing the Pari Passu Notes. To the extent that the aggregate amount of Excess Proceeds that resulted in the requirement Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offerfor general corporate purposes, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by subject to other covenants contained in this Indenture. If the aggregate principal amount of Notes and such other Senior Indebtedness Pari Passu Notes validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee, in accordance with the applicable procedures of the Depository, shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness the holders, trustees or similar representatives, as the case may be, of Pari Passu Notes shall select the Pari Passu Notes to be purchased on a pro rata based basis on the basis of the aggregate principal amount of such tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The . Each Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness and Pari Passu Notes required to be repaid or purchased by it pursuant to such offer this Section 4.15 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness Notes validly tendered in response to the Asset Disposition Offer.. Upon the commencement of an Asset Disposition Offer, the Company shall send, by first class mail, a notice to the Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Asset Disposition Offer. Any Asset Disposition Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:
(h1) that the Asset Disposition Offer is being made pursuant to this Section 4.15;
(2) the Asset Disposition Offer Amount and the Asset Disposition Purchase Date;
(3) that any Notes not tendered or accepted for payment shall continue to accrete or accrue interest;
(4) that, unless the Company defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrete or accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to the Asset Disposition Offer may only elect to have all of such Note purchased and may not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Asset Disposition Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by book-entry transfer, to the Company, a depository, if appointed by the Company, or the Paying Agent at the address specified in the notice at least three days before the Asset Disposition Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the Company, the Depository or the Paying Agent, as the case may be, receives, not later than the second business day prior to the Asset Disposition Purchase Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased);
(9) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(10) all other procedures, if any, determined by the Company, consistent with this Indenture, that a Holder must follow in order to have its Notes purchased in the Asset Disposition Offer. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, any accrued and unpaid interest will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of such Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in each case in integral multiples of $1,000 in principal amount (provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such other integral multiples as may be specified in the agreements governing such Pari Passu Notes. The Parent Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4.15 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Notes. Any Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Disposition Offer on or promptly following the Asset Disposition Purchase Date. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries may satisfy as an entirety to a Person in a transaction permitted under Article 5, which transaction does not constitute a Change of Control, the foregoing obligations successor company shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Disposition. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Available Cash prior to the expiration for purposes of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) Section 4.15. The Issuer Company will comply, to the extent applicable, with the requirements of Section Rule 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.15. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.15, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such complianceany conflict.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the Parent, time of the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than Sale at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of as determined in good faith by the Board of Directors of the date Company (including the value of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directorsall non-cash consideration); and
(ii2) at least 75% of the consideration received for the Parent assets sold by the Company or the Restricted Subsidiary, as the case may be, in the Asset Sale will be in the form of cash, Cash Equivalents or assets or Capital Stock which the Company or a Permitted Investing Subsidiary would be permitted to use the Net Cash Proceeds from such Restricted Subsidiary receives in respect Asset Sale to purchase or invest in, if any, pursuant to clause (2) of Section 3.12(b). For the purposes of this clause (2), the following are deemed to be cash:
(i) Indebtedness and other liabilities shown on the most recent consolidated balance sheet of the Company prior to the date of such Asset Disposition consists of:
Sale (Aother than Subordinated Indebtedness) cash (including i) that are assumed by the transferee of any Net Cash Proceeds received such assets and (ii) for which the Company and its Restricted Subsidiaries are released from all liability at the conversion within 180 days time of such Asset Disposition of Sale;
(ii) any securities, notes or other obligations Obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Company or any liabilities recorded on such Restricted Subsidiary from such transferee that are converted, sold or exchanged by the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositioninto cash or Cash Equivalents within 90 days, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer cash or such Guarantor;Cash Equivalents received in that conversion, sale or exchange; and
(Giii) any Designated Non-Cash cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (iii) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (7.5 million, with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If The Company or a Restricted Subsidiary, as the Parentcase may be, may (subject to the Issuer or proviso in clause (2) below) apply the Net Cash Proceeds of any other Restricted Subsidiary consummates an such Asset Disposition, Sale within 360 days thereof to:
(1) prepay, repay, purchase, repurchase, redeem, retire, defease or such period as provided in clause otherwise retire for value (viiicollectively, “repay”) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash toany:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer Company or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase Indebtedness of any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);Restricted Subsidiary that is not a Note Guarantor; or
(iii) any Senior Indebtedness, provided that, if the Company repays any Senior Indebtedness other than the Notes pursuant to this clause (iii), it must repay Notes or make an offer to repurchase the Notes at a price equal to or above 100% of the principal amount thereof, whether or not the Holders accept such offer, in each case on a pro rata basis with such other Senior Indebtedness; in the case of each of clauses (i) through (iii) above, constituting Indebtedness for borrowed money or Capitalized Lease Obligations, and permanently reduce the commitments with respect thereto without Refinancing; or
(2) purchase or otherwise invest in:
(i) assets (other than current assets as determined in any Replacement Assetsaccordance with GAAP or Capital Stock) to be used by the Company or a Permitted Investing Subsidiary in a Permitted Business or capital expenditures;
(ivii) acquire all or substantially all of the assets of, of a Permitted Business or any properties; or
(iii) Capital Stock of, another : (A) a Restricted Subsidiary held by a Person other than the Company or any of its Restricted Subsidiaries or (B) a Person engaged in a Similar BusinessPermitted Business that becomes, ifupon the purchase or investment, after giving effect to any such acquisition a Wholly Owned Subsidiary or, in the case of an Asset Sale in respect of assets or Capital Stock, such Person is or becomes Stock of a Restricted Subsidiary;
, a Restricted Subsidiary of which the Company owns, directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock as it does (vimmediately prior to such Asset Sale) in respect of the Restricted Subsidiary whose assets or Capital Stock are included in such Asset Sale; provided that (A) the following Persons may make a capital expenditure;
purchase or investment in accordance with the foregoing: (vix) acquire other the Company, (y) a Wholly Owned Subsidiary or (z) in the case of an Asset Sale in respect of assets or Capital Stock held by a Restricted Subsidiary only, a Restricted Subsidiary of which the Company, owns directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock as it does of the Restricted Subsidiary that made such Asset Sale and (B) no purchase from the Company or any Restricted Subsidiary will satisfy the provisions of this clause (2) (each, other than Capital Stock and cash or Cash Equivalents) that are used or useful in the Company, a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i“Permitted Investing Subsidiary”), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided thatthat (x) in the case of clause (2) above, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Company, or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 90 days of such commitment (an “Acceptable Commitment”) and such Net Cash Proceeds are actually applied to satisfy such commitment within the later of (xi) 360 days after receipt of the Net Cash Proceeds from the related Asset Sale and (ii) 90 days after the date on which of such investment is consummated, binding commitment and (y) to the 180th day following extent such Net Cash Proceeds are not actually applied to satisfy such commitment within the expiration of period set forth in clause (x) above, the aforementioned 360-day period, if the investment has Net Cash Proceeds not been consummated by that dateso applied shall constitute Excess Proceeds.
(c) The amount To the extent all or a portion of the Net Cash Proceeds of any Asset Sale are not applied within 360 days thereof (or such Net Available Cash not so used longer period as set forth permitted pursuant to an Acceptable Commitment as provided in Section 3.12(b) above) as described in clause (1) or (2) of Section 3.12(b) above constitutes (“Excess Proceeds.” Pending the final application of any such Net Available Cash”), the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer to purchase Notes (an “Asset Disposition Sale Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds), at an offer price, in respect of the Notes, a purchase price equal to no less than 100% of the principal amount thereof of the Notes to be purchased, plus accrued and unpaid interestinterest thereon, if any, to, but not including, to the date of purchasepurchase (the “Asset Sale Offer Amount”). The Company will purchase pursuant to an Asset Disposition Sale Offer from all tendering Holders on a pro rata basis in respect the manner provided in Section 5.5, and, at the Company’s option, on a pro rata basis with the holders of any other Senior Indebtedness with similar provisions requiring the Company to offer to purchase the other Senior Indebtedness with the proceeds of Asset Sales, that principal amount (or accreted value in the case of Indebtedness issued with original issue discount) of Notes and the other Senior Indebtedness to be purchased equal to such unapplied Net Cash Proceeds. The Company may satisfy its Obligations under this Section 3.12 with respect to any Net Cash Proceeds by making an Asset Sale Offer prior to the expiration of 360 days from the relevant Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b) above, the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in Section 3.12(b) above).
(d) The purchase of Notes pursuant to an Asset Sale Offer will occur not less than 20 Business Days following the date thereof, or any longer period as may be required by law, nor more than 45 days following the 360th day following the Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b), the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in such Section 3.12(b)). The Company may, however, defer an Asset Sale Offer until there is an aggregate amount of unapplied Net Cash Proceeds from one or more Asset Sales equal to or in excess of $15.0 million. At that time, the entire amount of unapplied Net Cash Proceeds, and not just the amount in excess of $15.0 million, will be made applied as required pursuant to this Section 3.12. Pending application in accordance with this Section 3.12, Net Cash Proceeds may be applied to reduce revolving credit borrowings, Invested in Cash Equivalents or used for general corporate purposes.
(e) Each Asset Sale Offer Notice will be mailed first class, postage prepaid, to the procedures record Holders as shown on the register of Holders within 30 days following such 360th day (or, in the event an Acceptable Commitment has been entered into as set forth in this IndentureSection 3.12(b) above, the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in minimum denominations such Section 3.12(b)), with a copy to the Trustee offering to purchase the Notes as described above. Each Asset Sale Offer Notice will state, among other things, the purchase date, which must be no earlier than 30 days nor later than 60 days from the date the notice is mailed, other than as may be required by law (the “Asset Sale Offer Payment Date”). Upon receiving notice of an Asset Sale Offer, Holders may elect to tender their Notes in whole or in part in a principal amount of $200,000 and in 2,000 or integral multiples of $1,000 in excess thereofthereof in exchange for cash.
(ef) On the Asset Sale Offer Payment Date, the Company will, to the extent lawful:
(1) accept for payment all Notes or portions thereof properly tendered pursuant to the Asset Sale Offer;
(2) deposit with the Paying Agent funds in an amount equal to the Asset Sale Offer Amount in respect of all Notes or portions thereof so tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Company.
(g) To the extent Holders of Notes and holders of other Senior Indebtedness, if any, which are the subject of an Asset Sale Offer properly tender and do not withdraw Notes or the other Senior Indebtedness in an aggregate amount exceeding the amount of unapplied Net Cash Proceeds, the Company will purchase the Notes and the other Senior Indebtedness on a pro rata basis (based on amounts tendered). If only a portion of a Note is purchased pursuant to an Asset Sale Offer, a new Note in a principal amount equal to the portion thereof not purchased will be issued in the name of the Holder thereof upon cancellation of the original Note (or appropriate adjustments to the principal amount of a global Note will be made, as appropriate). Notes (or portions thereof) purchased pursuant to an Asset Sale Offer will be cancelled and cannot be reissued. Upon completion of any such an Asset Disposition Sale Offer, the amount of Excess Net Cash Proceeds that resulted in the requirement to make an Asset Disposition Offer shall will be reset at zero. Accordingly, to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If extent that the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer exceeds is less than the aggregate amount of Excess unapplied Net Cash Proceeds, the Excess Company may use any remaining Net Cash Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the for general corporate purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into Company and its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition OfferRestricted Subsidiaries.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer Company will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other applicable securities laws or regulations in connection with the repurchase purchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any applicable securities laws or regulations conflict with provisions of this Section 4.053.12, the Issuer Company will comply with the applicable securities these laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 3.12 by virtue of such compliancedoing so.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (MDC Partners Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); and
the shares and assets subject to such Asset Disposition, (ii) except in the case of a Permitted Asset Swap, at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in the form of cash and (iii) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) (1) first, to the extent the Company elects (or is required by the terms of any ----- Indebtedness), to prepay, repay, purchase, repurchase, redeem, retire, defease or otherwise acquire for value Senior Indebtedness of the Company or Indebtedness of a Restricted Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Company (other than an Affiliate of Chase Capital Partners which is a lender in the ordinary course of business) and other than obligations in respect of such Disqualified Stock) within 180 days
(a) except to the extent that the aggregate Net Available Cash from all Asset Disposition consists of:
Dispositions that is not applied in accordance with this Section 4.06(a) exceeds $7.5 million. For the purposes of this Section 4.06, the following are deemed to be cash: (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated obligations in respect of such liabilities, Disqualified Stock of the Company) or any Restricted Subsidiary (y) Indebtedness other than obligations in respect of Disqualified Stock and Preferred Stock of a Restricted Subsidiary that is no longer not a Note Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition and (B) securities received by the Company or any Restricted Subsidiary from the transferee that are promptly converted by the Company or such Restricted Subsidiary into cash.
(b) In the event of an Asset Disposition that requires the purchase of Securities pursuant to Section 4.06(a)(iii)(3), the Company shall be required (i) to purchase Securities tendered pursuant to an offer by the Company for the Securities (the "Offer") at a purchase price of 100% of their principal amount plus accrued and unpaid interest and liquidated damages thereon, if any, to the date of purchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date) in accordance with the procedures (including prorating in the event of oversubscription) set forth in Section 4.06(c) and (ii) to purchase other Senior Subordinated Indebtedness of the Company on the terms and to the extent contemplated thereby (provided that in no event shall the Company offer to purchase such other Senior Subordinated Indebtedness of the Company at a purchase price in excess of 100% of its principal amount (without premium), plus accrued and unpaid interest thereon, unless an equal premium is offered to Holders in the Offer). If the aggregate purchase price of Securities (and other Senior Subordinated Indebtedness) tendered pursuant to the Offer is less than the Net Available Cash allotted to the purchase of the Securities (and other Senior Subordinated Indebtedness), the Company shall apply the remaining Net Available Cash in accordance with Section 4.06(a)(iii)(4). The Company shall not be required to make an Offer for Securities (and other Senior Subordinated Indebtedness) pursuant to this Section 4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (1) and (2) of Section 4.06(a)(iii)) is less than $5.0 million for any particular Asset Disposition (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(i) Promptly, and in any event within 15 days after the Company becomes obligated to make an Offer, the Company shall be obligated to deliver to the Trustee and send, by first-class mail to each Holder, a result written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as hereinafter described in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such Asset Disposition, if notice (the Parent"Purchase Date") and shall contain such information concerning the business of the Company which the Company in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the Issuer most recent subsequently filed Quarterly Report on Form 10-Q and every any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other Restricted Subsidiary is released from any guarantee than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), (2) a description of material developments in the Company's business subsequent to the date of the latest of such Indebtedness as a result of such Asset Disposition;
reports, and (D3) Replacement Assets;
(Eif material, appropriate pro forma financial information) any Capital Stock or assets of and all instructions and materials necessary to tender Securities pursuant to the kind Offer, together with the address referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(Giii).
(bii) If Not later than the Parentdate upon which written notice of an Offer is delivered to the Trustee as provided above, the Issuer or any other Restricted Subsidiary consummates Company shall deliver to the Trustee an Asset Disposition, within 360 days Officers' Certificate as to (or such period as provided in clause (viii1) below, if applicable) the amount of the later of Offer (the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a"Offer Amount"), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices2) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (3) the compliance of such commitment until allocation with the earlier provisions of Section 4.06(a). On such date, the Company shall also irrevocably deposit with the Trustee or with a paying agent (xor, if the Company is acting as its own paying agent, segregate and hold in trust) an amount equal to the date on Offer Amount to be invested in Temporary Cash Investments (which such investment is consummated, Temporary Cash Investments will be made only pursuant to written instructions of an officer of the Company) and (y) to be held for payment in accordance with the 180th day following provisions of this Section. Upon the expiration of the aforementioned 360-day period, if period for which the investment has not been consummated by that date.
Offer remains open (c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash"Offer Period"), the Parent Company shall deliver to the Trustee for cancelation the Securities or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner portions thereof that is not prohibited have been properly tendered to and are to be accepted by the terms of this Indenture.
(d) On the 361st day Company. The Trustee (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer electsPaying Agent, if not the aggregate amount of Excess Proceeds exceeds $60 millionTrustee) shall, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, on the date of purchase, mail or deliver payment to each tendering Holder in the amount of the purchase price. The Asset Disposition In the event that the Offer in respect Amount delivered by the Company to the Trustee is greater than the purchase price of Notes will be made the Securities (and other Senior Subordinated Indebtedness) tendered, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereofSection 4.06.
(eiii) Upon completion Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed (which form shall include certain information concerning the Holder and the Security), to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a facsimile transmission or letter setting forth the name of any such Asset Disposition Offerthe Holder, the principal amount of Excess Proceeds the Security which was delivered by the Holder for purchase and a duly signed statement that resulted in such Holder is withdrawing his election to have such Security purchased. If at the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on Period the aggregate principal amount of Notes Securities and such any other Senior Subordinated Indebtedness included in the Offer surrendered by holders thereof exceeds the Offer Amount, the Company shall select the Securities and other Senior Subordinated Indebtedness to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so tendered that only Securities and not properly withdrawnother Senior Subordinated Indebtedness in denominations of $1,000, or integral multiples thereof, shall be purchased). For the purposes of calculating the Holders whose Securities are purchased only in part will be issued new Securities equal in principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning unpurchased portion of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zeroSecurities surrendered.
(fiv) To At the extent that any portion of Net Available Cash payable in respect of time the Notes is denominated in a currency other than Company delivers Securities to the currency in Trustee which the relevant Notes are denominatedto be accepted for purchase, the amount thereof payable in respect of Company shall also deliver an Officers' Certificate stating that such Notes shall not exceed the net amount of funds in the currency in which such Notes Securities are denominated that is actually received to be accepted by the Issuer upon converting such portion Company pursuant to and in accordance with the terms of this Section. A Security shall be deemed to have been accepted for purchase at the Net Available Cash into such currencytime the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(gv) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection 4.06. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.06, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 4.06 by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Commercial Aggregates Transportation & Sales LLC)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the Company (or the Restricted Subsidiary, as the case may be) receives consideration at the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than the fair market value time of the assets disposed of Asset Sale at least equal to the Fair Market Value (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by Sale) of the Parent’s Board of Directors)assets or Equity Interests issued or sold or otherwise disposed of; and
(ii2) either (x) at least 75% of the consideration therefor received by the Parent Company or such Restricted Subsidiary receives is in respect the form of cash or Cash Equivalents or a combination thereof or (y) the Fair Market Value of the aggregate of all consideration other than cash or Cash Equivalents for all Asset Sales since the Issue Date would not exceed 5% of Consolidated Tangible Assets of the Company after giving effect to such Asset Disposition consists of:Sales; provided that any of the following items shall be deemed to be cash and Cash Equivalents for the purposes of this clause (2):
(Aa) cash other than with respect to an Asset Sale of Collateral, the assumption or forgiveness of any liabilities (including as shown on the Company’s or the Restricted Subsidiary’s most recent balance sheet) of the Company or any Net Cash Proceeds received Restricted Subsidiary of the Company (other than liabilities that are by their terms subordinated to Notes issued under this Indenture or any Subsidiary Guarantee) by the transferee of any such assets pursuant to a novation or other release or repurchase agreement that releases the Company or the Restricted Subsidiary from the conversion within 180 days of such Asset Disposition of further liability;
(b) any securities, notes Notes or other obligations received in consideration by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or the Restricted Subsidiary into cash or Cash Equivalents within 180 days following their receipt (to the extent of cash or Cash Equivalents received); and
(c) other than with respect to an Asset Sale of Collateral, any stock or assets that constitute Replacement Assets; and
(3) the Net Proceeds from any such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption Sale of Collateral is paid directly by the purchaser thereof to the Collateral Agent to be held in a Collateral Account for application in accordance with this covenant. Notwithstanding the foregoing provisions of (x) any liabilities recorded on the Parent’sabove paragraph, the Issuer’s or such other Company and its Restricted Subsidiary’s balance sheet or the notes thereto Subsidiaries will not be required to cause any Net Proceeds to be held in a Collateral Account in accordance with clause (or, if Incurred since the date 3) of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only above paragraph except to the extent the aggregate Net Proceeds from all Asset Sales of Collateral that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to would then be held in a Collateral Account exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)15.0 million.
(b) If Within 365 days after the Parentreceipt of any Net Proceeds from an Asset Sale or, if the Company has entered into a binding commitment or commitments with respect to any of the actions described in clauses (1)(b) or (2)(a)-(d) below, within the later of (x) 360 days after the receipt of any Net Proceeds from an Asset Sale or (y) 180 days after the entering into of such commitment or commitments, the Issuer Company (or the applicable Restricted Subsidiary, as the case may be) may apply such Net Proceeds:
(1) with respect to Asset Sales of Collateral,
(a) to repay, redeem, repurchase or otherwise retire the Notes or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days Priority Lien Debt (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(icombination thereof); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that if the Parent, and its Company or any Restricted Subsidiaries Subsidiary shall be entitled to prepay, so repay, purchase redeem or redeem such Pari Passu Indebtedness that constitutes Public reduce any Priority Lien Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the IssuerNotes, the Company or such Restricted Subsidiary will redeem or equally and ratably repurchase (or offer to repurchase) the Notes as provided either, at the Company’s option, under “—Optional Redemption,” through open-market purchases (to the extent such purchases are at a purchase price at or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness above 100% of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(iiprincipal amount thereof plus accrued but unpaid interest, if any) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes offer (in accordance with the procedures set out forth below for an Asset Sale Offer (as defined below);) to all Holders to purchase their Notes at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of Notes that would otherwise be prepaid to the date of such repurchases; or
(iiib) to invest in any Replacement Assets;Assets that would constitute Collateral; and
(iv2) with respect to Asset Sales other than an Asset Sale of Collateral,
(a) to acquire all or substantially all of the properties or assets ofof a Person primarily engaged in a Permitted Business if, or as a result of such acquisition, such Person becomes a Restricted Subsidiary of the Company;
(b) to acquire any Capital Stock of, another of a Person engaged in operating a Similar Business, Permitted Business if, after giving effect to any such acquisition of Capital Stockacquisition, such Person operating a Permitted Business is or becomes a Restricted SubsidiarySubsidiary of the Company;
(vc) to make a capital expenditureexpenditures in respect of the Company’s or its Restricted Subsidiaries’ Permitted Business or make an Investment in Replacement Assets;
(vid) to acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Permitted Business or make an Investment in assets that will be used or useful in a Permitted Business;
(vii) consummate any combination of the foregoing; or
(viiie) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) repay or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application retire Indebtedness of the Net Available Cash from the date of such commitment until the earlier of Company or any Restricted Subsidiary (x) the date on which such investment is consummated, and (y) the 180th day following the expiration other than subordinated Indebtedness or Indebtedness owed to an Affiliate of the aforementioned 360-day period, if the investment has not been consummated by that dateCompany).
(c) The amount of such Any Net Available Cash Proceeds from Asset Sales that are not so used applied or invested as set forth provided in Section 3.5(b) above constitutes shall be deemed to constitute “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) Within 10 business days after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 20.0 million, or earlier at the Issuer Company’s option, the Company will be required within twenty (20) Business Days thereof to make an offer to the Holders of Notes issued thereunder and the holders of any other Priority Lien Debt that is subject to requirements with respect to the application of net proceeds from asset sales that are substantially similar to those contained in this Indenture (an “Asset Disposition Sale Offer”) to all purchase on a pro rata basis (with the Excess Proceeds prorated between the Holders and, to of the extent the Issuer elects, to all or some Notes and such holders of such other Priority Lien Debt based upon outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase aggregate principal amounts) the maximum principal amount of the Notes and any such other Senior Indebtedness Priority Lien Debt that may be purchased or prepaid, as applicable, out of the prorated Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, interest thereon to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indenturebelow. To the extent that the aggregate principal amount of the Notes and other Priority Lien Debt tendered (and electing to be redeemed or repaid, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(eas applicable) Upon completion of any such pursuant to an Asset Disposition OfferSale Offer is less than the Excess Proceeds, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent Company and its Restricted Subsidiaries may use such Net Available Cash any remaining Excess Proceeds for general corporate purposes and any other purpose not prohibited by this Indenture. If the aggregate principal amount of the Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer Priority Lien Debt surrendered by holders thereof exceeds the amount of the prorated Excess Proceeds, the Excess Proceeds Company shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness Priority Lien Debt to be purchased on a pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Periodbasis. Upon completion of any each Asset Disposition Sale Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To . The Company will publicly announce the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination results of the Asset Disposition Sale Offer Period (on or as soon as practicable after the “date such Asset Disposition Purchase Date”), the Issuer Sale Offer is completed. The Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other securities laws or and regulations thereunder to the extent such laws and regulations are applicable in connection with the repurchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.053.5, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture covenant by virtue of the Company’s compliance with such compliancesecurities laws or regulations.
(jd) Except as otherwise provided in Section 9.01Any Asset Sale Offer will remain open for a period of 20 Business Days following its commencement, except to the extent that a longer period is required by applicable law (the “Asset Sale Offer Period”). No later than five Business Days after the termination of the Asset Sale Offer Period (the “Asset Sale Purchase Date”), the provisions of this Indenture relating to Company will purchase the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of Notes and such other Priority Lien Debt as may be required to be purchased pursuant to this Section 3.5 (the “Asset Sale Offer Amount”) or, if less than the Asset Sale Offer Amount has been so validly tendered and not properly withdrawn, all Notes (with and such consentother Priority Lien Debt validly tendered and not properly withdrawn in response to the Asset Sale Offer. If the Asset Sale Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, for any accrued and unpaid interest, if any, will be paid to the avoidance Person in whose name a Note is registered at the close of doubtbusiness on such record date, and no further interest will be payable to Holders who tender Notes pursuant to the Asset Sale Offer. On or before the Asset Sale Purchase Date, the Company will, to the extent lawful, accept for payment, to the extent necessary on a pro rata basis as described above (except that any Notes represented by a Note in global form will be considered effective selected by such method as DTC or its nominee or successor may require or, where such nominee or successor is the Trustee, a method that most nearly approximates pro rata selection as the Trustee deems fair and appropriate unless otherwise required by law), Notes and such other Priority Lien Debt or portions of Notes and such other Priority Lien Debt so validly tendered and not properly withdrawn pursuant to the Asset Sale Offer, or if less than the aggregate Asset Sale Offer Amount has been validly tendered and not properly withdrawn, all Notes and such other Priority Lien Debt so validly tendered and not properly withdrawn, in each case in minimum principal amount of $2,000 and integral multiples of $1,000 in excess of $2,000; provided that if, following the Notes repurchase of consenting Holders represents a majority portion of a Note, the aggregate outstanding remaining principal amount of such Note outstanding immediately after such repurchase would be less than $2,000, then the portion of such Note so repurchased shall be reduced such that the remaining principal amount of such Note outstanding immediately after such repurchase is $2,000. The Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 3.5 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing other Priority Lien Debt. The Company or the paying agent, as the case may be, will promptly (but in any case not later than five Business Days after the termination of the Asset Sale Offer Period) mail (or otherwise deliver in accordance with the applicable procedures of DTC) to each tendering Holder of Notes or holder or lender of such other Priority Lien Debt, as the case may be, an amount equal to the purchase price of the Notes or such other Priority Lien Debt so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a whole new Note, and without regard the Trustee, upon delivery of an authentication order from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a minimum principal amount of $2,000 or an integral multiple of $1,000 in excess of $2,000. In addition, the Company will take any and all other actions required by the agreements governing such other Priority Lien Debt. Any Note not so accepted will be promptly mailed or delivered by the Company to the level of consent obtained among Holders of each constituent series of Notes)Holder thereof.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); and
the shares and assets subject to such Asset Disposition, (ii) at least 75% of the consideration therefor received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash; provided that the following shall be deemed to be cash for purposes of this clause (Aii) cash (including any but not for purposes of the definition of Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
Available Cash): (B) Cash Equivalents;
(C1) the assumption by the purchaser amount of (x) any liabilities recorded (as shown on the Parent’s, the Issuer’s Company's or such other Restricted Subsidiary’s 's most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Company or any Restricted Subsidiary (other than Subordinated Indebtedness)liabilities that are by their terms subordinated to the Notes or the Guarantees) that are assumed by the transferee of any such assets, as a result (2) the amount of which none any securities received by the Company or such Restricted Subsidiary from such transferee that are converted or scheduled to be converted by the Company or such Restricted Subsidiary into cash (to the extent of the Parent, cash received or scheduled to be received) within 90 days following the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result closing of such Asset Disposition, if (3) the Parent, Fair Market Value of any Related Assets received by the Issuer and every other Company or such Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of in such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, Disposition and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G4) any Designated Non-Cash Noncash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (4) that is at any one time outstandinghas not been converted into cash or cash equivalents, not to exceed the greater of 1510% of Consolidated EBITDA and $150 million Net Tangible Assets as of the end of the most recent fiscal quarter for which financial statements are publicly available at the time such Designated Noncash Consideration is received (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Maxxim Medical Inc/Tx)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Borrower shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Borrower or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors)the shares and assets subject to such Asset Disposition; and
(ii2) at least 75% of the consideration therefor received by the Parent Borrower or such Restricted Subsidiary receives is (i) to the extent the assets subject to such Asset Disposition do not constitute Collateral under this Agreement, in the form of cash or Additional Assets, or (ii) to the extent the assets subject to such Asset Disposition do constitute Collateral under this Agreement, in the form of cash or assets that are included in the Collateral.
(b) For the purposes of this covenant, the following are deemed to be cash:
(1) the assumption of Indebtedness or other obligations of the Borrower (other than obligations in respect of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date Disqualified Stock of the latest balance sheet, that would be recorded on the next balance sheetBorrower) or any Restricted Subsidiary (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated obligations in respect of such liabilities, or (y) Indebtedness Disqualified Stock and Preferred Stock of a Restricted Subsidiary that is no longer a Subsidiary Guarantor) and the release of the Borrower or such Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of all liability on such Indebtedness as a result of or obligations in connection with such Asset Disposition;
(D2) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only except to the extent that such Indebtedness (i) has been extinguished by the Issuer or assets subject to the applicable GuarantorAsset Disposition constitute Collateral under this Agreement, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Noncash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market valueFair Market Value that, when taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant that is at any one time clause and then outstanding, does not to exceed at the greater time of 15% the receipt of Consolidated EBITDA and $150 million such Designated Noncash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or) the greater of (1) $200,000,000 and (2) 1.5% of the total Consolidated assets of the Borrower as shown on the most recent balance sheet of the Borrower filed with the SEC;
(H3) any combination of securities, notes or similar obligations received by the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent Borrower or any Restricted Subsidiary);Subsidiary from the transferee that are promptly converted by the Borrower or such Restricted Subsidiary into cash; and
(ii4) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Temporary Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that dateInvestments.
(c) The amount Borrower may not use any Net Available Cash to prepay, redeem or purchase any Indebtedness that is not Priority Secured Indebtedness unless (i) the Pro Forma Senior Secured Leverage Ratio for the most recently ended period of four consecutive fiscal quarters for which financial statements have been delivered under Section 5.01(a) or (b) (or, at any time prior to the first delivery of such financial statements, for the fiscal year ended December 31, 2011) would have been equal to or less than 3.00 to 1.00, determined at the time of such proposed use on a pro forma basis as described in the definition of Pro Forma Senior Secured Leverage Ratio, or (ii) the Borrower first offers to use such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending to prepay the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash Loans in any manner that is not prohibited by the terms of this Indentureaccordance with Section 2.07(b).
(d) On Upon receipt of written notice from the 361st day Borrower to the Collateral Agent, the Collateral Agent is hereby authorized and directed to release any security interest under any Security Document in any Capital Stock of any Foreign Subsidiary transferred, for tax planning or other business purposes, consistent with the Borrower’s past practices, to any Foreign Subsidiary whose Capital Stock has been pledged under any of the Security Documents if either (i) the transferor of such Capital Stock is the Borrower or a Domestic Subsidiary and such release is required in order to obtain the 541st day if desired amount of consideration from such transfer, or (ii) after giving effect to such transfer, the aggregate fair value of all such Capital Stock (other than Capital Stock transferred in a binding commitment as transaction described in Section 4.05(b)(viii) is entered into) after an Asset Dispositionthe immediately preceding clause (i)), or such earlier time determined as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indentureeach respective transfer, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall does not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consentexceed, for the avoidance of doubtall such transfers, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)$250,000,000.
Appears in 1 contract
Sources: Second Lien Credit Agreement (Goodyear Tire & Rubber Co /Oh/)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Borrower shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition Disposition, unless:
(i) the consideration the Parent, the Issuer Borrower or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition at least equal to the Fair Market Value (including as to the value of all non-cash consideration) of the shares and other assets subject to such Asset Disposition (in each case, such Fair Market Value to be determined by on the Parent’s Board date of Directorscontractually agreeing to such Asset Disposition); and
and (ii) at least 7575.0% of the consideration thereof received by the Parent Borrower or such Restricted Subsidiary receives is in the form of cash or Temporary Cash Investments.
(b) For purposes of clause (a)(ii) of this Section 7.5, and for no other purpose under this Agreement, the following shall be deemed to be Temporary Cash Investments: 97
(i) the assumption or Discharge of Senior Indebtedness of the Borrower or any Guarantor (other than obligations in respect of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date Disqualified Stock of the latest balance sheet, that would be recorded on the next balance sheetBorrower or Preferred Stock of a Guarantor) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, Indebtedness or (y) Indebtedness Preferred Stock of a Restricted Subsidiary that is no longer not a Guarantor and the release of the Borrower or such Restricted Subsidiary as a result of from all liability on such Indebtedness in connection with such Asset Disposition; (ii) any securities or other obligations received by the Borrower or any Restricted Subsidiary from the transferee that are converted by the Borrower or such Restricted Subsidiary into cash within 180 days after such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent of the cash received in that such Indebtedness conversion; (iiii) has been extinguished the Fair Market Value of (A) any assets (other than securities) received by the Issuer Borrower or any Restricted Subsidiary to be used by it in the applicable GuarantorRelated Business, (B) Capital Stock in a Person that is a Restricted Subsidiary or in a Person engaged in the Related Business that shall become a Restricted Subsidiary immediately upon the acquisition of such Person by the Borrower or any Restricted Subsidiary or (C) a combination of (A) and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
B); and (Giv) any Designated Non-Cash cash Consideration received by the Parent Borrower or any such Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with the Fair Market Value of all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (iv) that is at any one that time outstanding, not to exceed the greater of 15than 7.5% of Consolidated EBITDA and $150 million (Net Tangible Assets at the time of the receipt of such Designated Non-cash Consideration, with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer Borrower shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of apply the Net Available Cash into such currency.
(g) The from any Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes2.3(b)(iii).
Appears in 1 contract
Sources: Credit and Guaranty Agreement (U.S. Concrete, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the Parent, time of the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than Sale at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of as determined in good faith by the Board of Directors of the date Company (including the value of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directorsall non-cash consideration); and
(ii2) at least 75% of the consideration received for the Parent assets sold by the Company or the Restricted Subsidiary, as the case may be, in the Asset Sale will be in the form of cash, Cash Equivalents or assets or Capital Stock which the Company or a Permitted Investing Subsidiary would be permitted to use the Net Cash Proceeds from such Restricted Subsidiary receives in respect Asset Sale to purchase or invest in, if any, pursuant to clause (2) of Section 3.12(b). For the purposes of this clause (2), the following are deemed to be cash:
(i) Indebtedness and other liabilities shown on the most recent consolidated balance sheet of the Company prior to the date of such Asset Disposition consists of:
Sale (Aother than Subordinated Indebtedness) cash (including i) that are assumed or repaid or otherwise extinguished by the transferee of any Net Cash Proceeds received such assets and (ii) for which the Company and its Restricted Subsidiaries are released from all liability at the conversion within 180 days time of such Asset Disposition of Sale;
(ii) any securities, notes or other obligations Obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Company or any liabilities recorded on such Restricted Subsidiary from such transferee that are converted, sold or exchanged by the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositioninto cash or Cash Equivalents within 90 days, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer cash or such Guarantor;Cash Equivalents received in that conversion, sale or exchange; and
(Giii) any Designated Non-Cash cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (iii) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (15.0 million, with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If The Company or a Restricted Subsidiary, as the Parentcase may be, may (subject to the Issuer or provisos below) apply the Net Cash Proceeds of any other Restricted Subsidiary consummates an such Asset Disposition, Sale within 360 days thereof to:
(1) prepay, repay, purchase, repurchase, redeem, retire, defease or such period as provided in clause otherwise retire for value (viiicollectively, “repay”) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash toany:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer Company or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase Indebtedness of any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);Restricted Subsidiary that is not a Note Guarantor; or
(iii) any Senior Indebtedness, provided that, if the Company repays any Senior Indebtedness other than the Notes pursuant to this clause (iii), it must repay Notes or make an offer to repurchase the Notes at a price equal to or above 100% of the principal amount thereof, whether or not the Holders accept such offer, in each case on a pro rata basis with such other Senior Indebtedness; in the case of each of clauses (i) through (iii) above, constituting Indebtedness for borrowed money or Capitalized Lease Obligations, and permanently reduce the commitments with respect thereto without Refinancing; or
(2) purchase or otherwise invest in:
(i) assets (other than current assets as determined in any Replacement Assetsaccordance with GAAP or Capital Stock) to be used by the Company or a Permitted Investing Subsidiary in a Permitted Business or capital expenditures;
(ivii) acquire all or substantially all of the assets of, of a Permitted Business or any properties; or
(iii) Capital Stock of, another : (A) a Restricted Subsidiary held by a Person other than the Company or any of its Subsidiaries or (B) a Person engaged in a Similar BusinessPermitted Business that becomes, ifupon the purchase or investment, after giving effect to any such acquisition a Restricted Subsidiary or, in the case of an Asset Sale in respect of assets or Capital Stock, such Person is or becomes Stock of a Restricted Subsidiary;
(v) make , a capital expenditure;
(vi) acquire other assets (other than Restricted Subsidiary of which the Company owns, directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock and cash or Cash Equivalentsas it does (immediately prior to such Asset Sale) that are used or useful in a Similar Business;
(vii) consummate any combination respect of the foregoingRestricted Subsidiary whose assets or Capital Stock are included in such Asset Sale; or
(viii3) enter into a binding commitment to apply repay Indebtedness arising from agreements of the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) Company or a combination thereofRestricted Subsidiary providing for adjustment of purchase price, deferred consideration, earn outs or similar obligations, in each case incurred in connection with the purchase or investment by the Company or a Restricted Subsidiary of or in assets or Capital Stock that occurred prior to such Asset Sale, and solely to the extent such repayment would be permitted under Section 3.12 (b)(2) herein if such purchase or investment had occurred immediately following the consummation of such Asset Sale; provided thatthat such purchase or investment shall have occurred not more than 365 days prior to such Asset Sale; provided that in the case of Section 3.12 (b)(2) above, (A) the following Persons may make a purchase or investment in accordance with the foregoing: (x) the Company, (y) a Wholly Owned Subsidiary or (z) in the case of an Asset Sale in respect of assets or Capital Stock held by a Restricted Subsidiary only, a Restricted Subsidiary of which the Company, owns directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock as it does of the Restricted Subsidiary that made such Asset Sale and (B) no purchase from the Company or any Subsidiary of the Company will satisfy the provisions of Section 3.12 (b)(2) above (each, other than the Company, a “Permitted Investing Subsidiary”); provided that (x) in the case of Section 3.12 (b)(2) above, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Company, or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 90 days of such commitment (an “Acceptable Commitment”) and such Net Cash Proceeds are actually applied to satisfy such commitment within the later of (xi) 360 days after receipt of the Net Cash Proceeds from the related Asset Sale and (ii) 90 days after the date on which of such investment is consummated, binding commitment and (y) to the 180th day following extent such Net Cash Proceeds are not actually applied to satisfy such commitment within the expiration of period set forth in clause (x) above, the aforementioned 360-day period, if the investment has Net Cash Proceeds not been consummated by that dateso applied shall constitute Excess Proceeds.
(c) The amount To the extent all or a portion of the Net Cash Proceeds of any Asset Sale are not applied within 360 days thereof (or such Net Available Cash not so used longer period as set forth permitted pursuant to an Acceptable Commitment as provided in Section 3.12(b) above) as described in clause (1) or (2) of Section 3.12(b) above constitutes (“Excess Proceeds.” Pending the final application of any such Net Available Cash”), the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer to purchase Notes (an “Asset Disposition Sale Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds), at an offer price, in respect of the Notes, a purchase price equal to no less than 100% of the principal amount thereof of the Notes to be purchased, plus accrued and unpaid interestinterest thereon, if any, to, but not including, to the date of purchasepurchase (the “Asset Sale Offer Amount”). The Company will purchase pursuant to an Asset Disposition Sale Offer from all tendering Holders on a pro rata basis in respect the manner provided in Section 5.5, and, at the Company’s option, on a pro rata basis with the holders of any other Senior Indebtedness with similar provisions requiring the Company to offer to purchase the other Senior Indebtedness with the proceeds of Asset Sales, that principal amount (or accreted value in the case of Indebtedness issued with original issue discount) of Notes and the other Senior Indebtedness to be purchased equal to such Excess Proceeds. The Company may satisfy its Obligations under this Section 3.12 with respect to any Excess Proceeds by making an Asset Sale Offer at the Asset Sale Offer Amount prior to the expiration of 360 days from the relevant Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b) above, the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in Section 3.12(b) above).
(d) The purchase of Notes pursuant to an Asset Sale Offer will occur not less than 20 Business Days following the date thereof, or any longer period as may be required by law, nor more than 45 days following the 360th day following the Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b), the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in such Section 3.12(b)). The Company may, however, defer an Asset Sale Offer until there is an aggregate amount of Excess Proceeds from one or more Asset Sales equal to or in excess of $25.0 million. At that time, the entire amount of Excess Proceeds, and not just the amount in excess of $25.0 million, will be made applied as required pursuant to this Section 3.12. Pending application in accordance with this Section 3.12, Net Cash Proceeds may be applied to reduce revolving credit borrowings, Invested in Cash Equivalents or used for general corporate purposes in accordance with this Indenture.
(e) Each Asset Sale Offer Notice will be mailed first class, postage prepaid, to the procedures record Holders as shown on the register of Holders within 30 days following such 360th day (or, in the event an Acceptable Commitment has been entered into as set forth in this IndentureSection 3.12(b) above, the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in minimum denominations such Section 3.12(b)), with a copy to the Trustee offering to purchase the Notes as described above. Each Asset Sale Offer Notice will state, among other things, the purchase date, which must be no earlier than 30 days nor later than 60 days from the date the notice is mailed, other than as may be required by law (the “Asset Sale Offer Payment Date”). Upon receiving notice of an Asset Sale Offer, Holders may elect to tender their Notes in whole or in part in a principal amount of $200,000 and in 2,000 or integral multiples of $1,000 in excess thereofthereof in exchange for cash.
(ef) On the Asset Sale Offer Payment Date, the Company will, to the extent lawful:
(1) accept for payment all Notes or portions thereof properly tendered pursuant to the Asset Sale Offer;
(2) deposit with the Paying Agent funds in an amount equal to the Asset Sale Offer Amount in respect of all Notes or portions thereof so tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Company.
(g) To the extent Holders of Notes and holders of other Senior Indebtedness, if any, which are the subject of an Asset Sale Offer properly tender and do not withdraw Notes or the other Senior Indebtedness in an aggregate amount exceeding the amount of Excess Proceeds, the Company will purchase the Notes and the other Senior Indebtedness on a pro rata basis (based on amounts tendered). If only a portion of a Note is purchased pursuant to an Asset Sale Offer, a new Note in a principal amount equal to the portion thereof not purchased will be issued in the name of the Holder thereof upon cancellation of the original Note (or appropriate adjustments to the principal amount of a Global Note will be made, as appropriate). Notes (or portions thereof) purchased pursuant to an Asset Sale Offer will be cancelled and cannot be reissued. Upon completion of any such an Asset Disposition Sale Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall will be reset at zero. Accordingly, to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If extent that the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer exceeds is less than the aggregate amount of Excess Proceeds, the Excess Company may use any remaining Net Cash Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the for general corporate purposes of calculating the principal amount of any such Indebtedness tendered Company and its Restricted Subsidiaries in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offeraccordance with this Indenture.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer Company will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other applicable securities laws or regulations in connection with the repurchase purchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any applicable securities laws or regulations conflict with provisions of this Section 4.053.12, the Issuer Company will comply with the applicable securities these laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 3.12 by virtue of such compliancedoing so.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (MDC Partners Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Issuer shall not, and will shall not permit any of the Issuer or Restricted Subsidiaries (and, in the case of an Asset Disposition described in clause (3) of the definition thereof, any other Restricted Subsidiary Unrestricted Subsidiary) to, consummate any an Asset Disposition Disposition, unless:
(i1) the consideration the Parent, the Issuer or such other Restricted Subsidiary (or, in the case of an Asset Disposition described in clause (3) of the definition thereof, any Unrestricted Subsidiary), as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by the Parent’s Board of DirectorsDisposition); and
(ii2) at least 75% of the consideration therefor received by the Parent Issuer or such Restricted Subsidiary receives (or, in respect the case of an Asset Disposition described in clause (3) of the definition thereof, any Unrestricted Subsidiary), as the case may be (which, for purposes of this clause (2), consideration will not include any contingent payment obligations related to such Asset Disposition consists Disposition, including, earn-out payments, purchase price adjustments and deferred purchase price payments), is in the form of cash or Cash Equivalents; provided that the amount of:
(A) cash any liabilities, as shown on the Issuer’s or such Restricted Subsidiary’s most recent balance sheet or in the notes thereto, of the Issuer or any of its Restricted Subsidiaries (including other than contingent liabilities and liabilities that are by their terms subordinated to the Notes) (i) that are assumed by the transferee of any Net Cash Proceeds received such assets and from which the conversion within 180 days Issuer or such Restricted Subsidiary has been validly released by all creditors in writing, or (ii) in respect of which neither the Issuer nor any Restricted Subsidiary following such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition)has any obligation;
(B) Cash Equivalents;
(C) the assumption any securities or other obligations received by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s Issuer or such other Restricted Subsidiary’s balance sheet or the notes thereto Subsidiary (or, if Incurred since in the date case of an Asset Disposition described in clause (3) of the latest balance sheetdefinition thereof, any Unrestricted Subsidiary) from such transferee that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, are converted by the Issuer or any such Restricted Subsidiary (or, in the case of an Asset Disposition described in clause (3) of the other Restricted Subsidiaries remains obligated in respect definition thereof, any Unrestricted Subsidiary) into cash or Cash Equivalents (to the extent of such liabilities, the cash or (yCash Equivalents received) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if within 180 days following the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result closing of such Asset Disposition;
(D) Replacement Assets;
(EC) any Capital Stock Stock, properties or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b4.11(b)(2);
(FD) consideration consisting cash held in escrow as security for any purchase price settlement, for damages in respect of Indebtedness a breach of representations and warranties or covenants or for payment of other contingent obligations in connection with such Asset Disposition; and
(E) any Designated Noncash Consideration received by the Issuer or any Guarantor received from Persons who are not Restricted Subsidiary (or, in the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness case of an Asset Disposition described in clause (i3) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or definition thereof, any Unrestricted Subsidiary) in such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (E) that is at any one that time outstanding, not to exceed the greater of 15(x) $20.0 million and (y) 2.0% of Consolidated EBITDA and $150 million (the Total Assets of the Issuer at the time of the receipt of such Designated Noncash Consideration, with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination , in each case, shall be deemed to be Cash Equivalents for purposes of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)this provision and for no other purpose.
(b) If Within 365 days after the Parentreceipt of any Net Cash Proceeds of any Asset Disposition, the Issuer or any other such Restricted Subsidiary consummates (or, in the case of an Asset Disposition, within 360 days (or such period as provided Disposition described in clause (viii) below, if applicable3) of the later of definition thereof, any Unrestricted Subsidiary), at its option, may apply the date of consummation of Net Cash Proceeds from such Asset Disposition to one or more of the following, or any combination,
(1) to reduce or repay:
(A) Indebtedness under the Credit Facility and receipt (i) permanently repay any term loans thereunder or (ii) reduce the revolving commitments, if any, thereunder; or
(B) to the extent the property that is subject to such Asset Disposition was sold by a non-Guarantor Subsidiary (other than an Unrestricted Subsidiary), Indebtedness of a non-Guarantor Subsidiary, other than Indebtedness owed to the Issuer or another Restricted Subsidiary; or
(2) to make (A) an Investment in any one or more businesses; provided that such Net Available Cash, Investment in any business is in the Parent form of the acquisition of Capital Stock of a Restricted Subsidiary or results in the Issuer or its Restricted Subsidiaries may use owning an amount of the Net Available Cash to:
Capital Stock of such business such that it constitutes a Restricted Subsidiary, (iB) (a) prepaycapital expenditures in respect of the Issuer, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall or their respective assets or (C) acquisitions of other properties or assets to be entitled held by the Issuer or its Restricted Subsidiaries (including assets that replace the business, properties and assets of the Issuer or any of its Restricted Subsidiaries that were the subject of such Asset Disposition, but excluding Capital Stock or other Investments in any Unrestricted Subsidiaries), in the case of each of (A), (B) and (C), used or useful in a Related Business; or
(3) to prepay, repay, purchase reduce or redeem such repay Pari Passu Indebtedness Payment Lien Obligations, provided, that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent Issuer or any Restricted Subsidiary shall so reduce Pari Passu Payment Lien Obligations, the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, shall equally and ratably reduce Obligations under the Notes in accordance with the provisions set forth under Section 3.07, through open market purchases of the Notes or through an offer to purchase Notes (in accordance with the procedures set forth below for an Asset Disposition Offer); provided, in that all Net Cash Proceeds used to make such an amount as would offer to purchase shall be deemed to have been so applied whether or not accepted by the Holders; or
(4) to reduce or repay Obligations under the aggregate principal amount of Notes then outstanding in accordance with the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepaymentsprovision set forth under Section 3.07, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary purchases of the Parent that is not a Guarantor (other than the Issuer) Notes or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to through an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the purchase Notes (in accordance with the procedures set out belowforth below for an Asset Disposition Offer);
(iii) invest in any Replacement Assets;
(iv) acquire ; provided, that all Net Cash Proceeds used to make such an offer to purchase shall be deemed to have been so applied whether or substantially all of not accepted by the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) Holders; provided that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Proceeds as set forth in Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v4.11(b)(2) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Issuer or such Restricted Subsidiary (or, in the case of an Asset Disposition described in clause (x3) of the date on which definition thereof, such investment Unrestricted Subsidiary) enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of the end of such 365-day period (an “Acceptable Commitment”) and, in the event any Acceptable Commitment is consummatedlater cancelled or terminated for any reason before the Net Cash Proceeds are applied in connection therewith, and then the Issuer or such Restricted Subsidiary (yor, in the case of an Asset Disposition described in clause (3) of the 180th day following definition thereof, such Unrestricted Subsidiary) shall be permitted to apply the Net Cash Proceeds in any manner set forth above before the expiration of the aforementioned 360such 180-day periodperiod and, if in the investment has not been consummated by that dateevent the Issuer or such Restricted Subsidiary (or, in the case of an Asset Disposition described in clause (3) of the definition thereof, such Unrestricted Subsidiary) fails to do so, then such Net Cash Proceeds shall constitute Excess Proceeds (as defined below).
(c) The amount of such Any Net Available Cash Proceeds from an Asset Disposition that are not so used invested or applied as provided and within the time period set forth above constitutes in Section 4.11(b) will be deemed to constitute “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the ”. The Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to shall make an offer to all Holders of the Notes (an “Asset Disposition Offer”) to and all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu IndebtednessPayment Lien Obligations containing provisions similar to those set forth in this Indenture with respect to offers to purchase, prepay or redeem with the proceeds of sales of assets to purchase purchase, prepay or redeem the maximum aggregate principal amount of the Notes (equal to $2,000 or integral multiples of $1.00 in excess thereof) and any such other Senior Pari Passu Payment Lien Obligations (plus all accrued interest on such Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith), that may be purchased out of the Excess Proceeds, Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof (or, in the event such Pari Passu Payment Lien Obligations were issued with original issue discount, 100% of the accreted value thereof), plus accrued and unpaid interest, if any, interest to, but not including, the date fixed for the closing of purchase. The Asset Disposition Offer in respect such offer (subject to the rights of Notes will be made Holders on the relevant record date to receive interest due on the relevant interest payment date), in accordance with the procedures set forth in this IndentureIndenture or the agreements governing the Pari Passu Payment Lien Obligations. The Issuer shall commence an Asset Disposition Offer with respect to Excess Proceeds within 30 days after the date that Excess Proceeds exceed $30.0 million by delivering the notice required pursuant to Section 3.11, in minimum denominations with a copy to the Trustee. The Issuer may, at its election, satisfy the foregoing obligations with respect to any Net Cash Proceeds from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Cash Proceeds prior to the expiration of $200,000 and in integral multiples of $1,000 in excess thereofthe relevant 365-day period (or such longer period provided above).
(ed) To the extent that the aggregate amount of Notes and Pari Passu Payment Lien Obligations tendered pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Issuer may use any remaining Excess Proceeds for any purpose not prohibited by this Indenture. If the aggregate principal amount of Notes and Pari Passu Payment Lien Obligations surrendered by such holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and the applicable agent or the Issuer shall select such Pari Passu Payment Lien Obligations to be purchased on a pro rata basis based on the accreted value or principal amount of the Notes tendered (with adjustments as necessary so that no Notes will be repurchased in part in an unauthorized denomination) or such Pari Passu Payment Lien Obligations tendered. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero zero.
(regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration e) Pending the final application of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Issuer (or the applicable Restricted Subsidiary) may temporarily reduce revolving credit borrowings or otherwise invest the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of in any such Indebtedness tendered in an Asset Disposition Offer manner that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so prohibited by this Indenture.
(if) The Issuer will comply, to the extent applicable, shall comply with the requirements of Section 14(e) of Rule 14e-l under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Notes pursuant to this Indenturean Asset Disposition Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.05Indenture, the Issuer will shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under described in this Indenture by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Each of Superior Energy and Issuer will not, and will not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(i1) the consideration the ParentSuperior Energy, the Issuer or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (including as to the value of all non-cash consideration) as determined in good faith by the Board of Directors of Superior Energy, an Officer of Superior Energy, an Officer of Issuer or an Officer of such Restricted Subsidiary with responsibility for such transaction, which determination shall be conclusive evidence of compliance with this provision, of the shares and assets disposed subject to such Asset Disposition;
(2) in the case of as an Asset Disposition for consideration exceeding $50.0 million, the fair market value is determined, in good faith, by the Board of Directors of Superior Energy, and evidenced by a resolution of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors); andDirectors of Superior Energy set forth in an Officers’ Certificate delivered to the Trustee;
(ii3) either (a) at least 75% of the consideration the Parent thereof received by Superior Energy, Issuer or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of cash or Temporary Cash Investments or (b) the fair market value (with the fair market value of each item of Designated Noncash Consideration being measured at the time received without giving effect to subsequent changes in value) of all forms of consideration other than cash or Temporary Cash Investments received for all Asset Dispositions since the Issue Date does not exceed in the aggregate an amount equal to 10% of Consolidated Tangible Assets at the time each determination is made; and
(4) an amount equal to 100% of the Net Available Cash from such Asset Disposition consists ofis applied by Superior Energy, Issuer or such Restricted Subsidiary, as the case may be, within 365 days after its receipt, at its option:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition)to repay Secured Indebtedness under a Debt Facility;
(B) Cash Equivalents;to acquire Additional Assets or to make capital expenditures in a Related Business; and
(C) to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B), to make an offer to the Holders (and to holders of other Indebtedness of Issuer that is pari passu with the Notes) to purchase Notes (and such other Indebtedness of Issuer) pursuant to and subject to the conditions contained in this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or (C) above, Issuer or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment, if any, to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Pending application of Net Available Cash pursuant to this Section 4.10, such Net Available Cash shall be invested in Temporary Cash Investments or used to reduce loans outstanding under any revolving credit facility existing under a Debt Facility. For the purposes of this Section 4.10, the following are deemed to be cash or Temporary Cash Investments: (i) the assumption by the purchaser of (x) Obligations of Superior Energy, Issuer or any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) Subsidiary (other than any of their Subordinated Indebtedness)Obligations) and the release of Superior Energy, Issuer or such Restricted Subsidiary, as a result of which none of the Parentcase may be, the Issuer or any of the other Restricted Subsidiaries remains obligated from all liability on such Obligations in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of connection with such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration securities received by the Parent Issuer or any Restricted Subsidiary from the transferee that are promptly converted by Issuer or such Restricted Subsidiary into cash within 180 days after the receipt thereof (to the extent of cash received) and (iii) any Designated Noncash Consideration received by Superior Energy, Issuer or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (iii) that is at any one that time outstanding, not to exceed the greater of 15(x) $60.0 million and (y) 1.5% of Consolidated EBITDA and $150 million Tangible Assets at the time of the receipt of such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
. The requirement of Section 4.10(a)(4) shall be deemed to be satisfied if an agreement (Hincluding a lease) any combination of committing to make the types of consideration acquisitions or expenditures referred to therein is entered into by Superior Energy, Issuer or a Restricted Subsidiary within the time period specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, is subsequently applied in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of agreement within six months following such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the agreement. Any Net Available Cash from Asset Dispositions that is not applied or invested as provided in Section 4.10(a)(4)(A) or (B) within the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as time period set forth above constitutes therein will be deemed to constitute “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if When the aggregate amount of Excess Proceeds exceeds $60 60.0 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) Offer to all Holders and, to the extent required under the Issuer electsterms of outstanding pari passu Indebtedness of Issuer, to all or some the holders of other such outstanding Senior Indebtedness that is Pari Passu pari passu Indebtedness, to purchase the maximum aggregate principal amount of Notes and any such other Senior pari passu Indebtedness that may be purchased out of Issuer in an amount equal to $2,000 or an integral multiple of $1,000 in excess thereof at a purchase price of 100% of their principal amount (or, in the event such other pari passu Indebtedness of Issuer was issued with significant original issue discount, 100% of the Excess Proceedsaccreted value thereof), at an offer pricewithout premium, plus accrued but unpaid interest and Additional Interest (or, in respect of the Notessuch other pari passu Indebtedness of Issuer, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestsuch lesser price, if any, to, as may be provided for by the terms of such Indebtedness of Issuer) to but not including, excluding the purchase date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in Section 3.09. Issuer may satisfy the foregoing obligations with respect to such Net Available Cash from an Asset Disposition by making an offer with respect to such Net Available Cash prior to the expiration of the application period. To the extent that the aggregate amount of Notes and such pari passu Indebtedness tendered pursuant to an Asset Disposition Offer is less than the Excess Proceeds, Issuer may use any remaining Excess Proceeds for general corporate purposes, subject to compliance with other covenants contained in this Indenture. If the aggregate principal amount of Notes or the pari passu Indebtedness surrendered by such holders thereof exceeds the amount of Excess Proceeds, in minimum denominations the Trustee or the applicable Registrar shall select the Notes and Issuer or agent for such pari passu Indebtedness shall select such pari passu Indebtedness to be purchased on a pro rata basis based on the principal amount (or accreted value) of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) the Notes or such pari passu Indebtedness tendered. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion . Each of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes Superior Energy and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to Section 3.09 hereof and this IndentureSection 4.10. To the extent that the provisions of any securities laws or regulations conflict with provisions of Section 3.09 hereof and this Section 4.054.10, the each of Superior Energy and Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under Section 3.09 hereof and this Indenture Section 4.10 by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consentsecurities laws or regulations. Upon the occurrence of an Investment Grade Rating Event, for the avoidance of doubt, this Section 4.10 will cease to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole apply to Issuer and without regard to the level of consent obtained among Holders of each constituent series of Notes)will no longer have effect.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a1) The Parent will Holdings shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(ia) the consideration the Parent, the Issuer Holdings or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (at least equal to the fair market value, as determined in good faith by the Parent’s Board of Directors); and, of the shares and assets subject to such Asset Disposition;
(iib) at least 75% of the consideration the Parent thereof received by Holdings or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash, provided that the following shall be deemed to be cash for purposes of this clause (A) cash b): (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(Ci) the assumption by the purchaser amount of (x) any liabilities recorded (as shown on the Parent’sHoldings', the Issuer’s or such other Restricted Subsidiary’s 's, most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Holdings or any Restricted Subsidiary (other than Subordinated Indebtedness)liabilities that are by their terms subordinated to the Securities) that are assumed by the transferee of any such assets, as a result (ii) the amount of which none any securities received by Holdings or such Restricted Subsidiary from such transferee that are converted by Holdings or such Restricted Subsidiary into cash (to the extent of the Parent, cash received) within 90 days following the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result closing of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(Diii) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of any Telecommunications Assets received by Holdings or any Restricted Subsidiary in such Asset Disposition and (iv) the fair market value of any Permitted Joint Venture Interests received by Holdings or any Restricted Subsidiary in such Asset Disposition; provided that the aggregate fair market value of all Permitted Joint Venture Interests received pursuant to this clause (iv), valued, in each issue of Designated Non-Cash Consideration being measured case, at the time received of receipt, shall not exceed 10% of Consolidated Net Tangible Assets, (for purposes of this Section 4.06(1)(b), all determinations of fair market value shall be made in good faith by the Board of Directors and without giving effect evidenced by an Officers' Certificate delivered to subsequent changes in valuethe Trustee); orand
(Hc) from and after the date on which neither the Bank Indebtedness or the Notes (including any combination Refinancings thereof) are outstanding, an amount equal to 100% of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Net Available Cash from such Asset Disposition, within 360 days Disposition is applied by Holdings (or such period Restricted Subsidiary, as provided the case may be):
(i) first, to the extent Holdings elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem, purchase or otherwise acquire Indebtedness (other than any Disqualified Stock) of a Wholly Owned Subsidiary (in clause (viiieach case, other than Indebtedness owed to Holdings or an Affiliate of Holdings and other than Preferred Stock) below, if applicable) within 180 days of the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) second, to the extent of the balance of Net Available Cash after application in accordance with clause (i) of this Section 4.06(1)(c), to the extent Holdings or such Restricted Subsidiary elects to, or enters into a binding agreement to, reinvest in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with cash in an amount equal to the amount of Net Available Cash received by, or to be received by, Holdings or another Restricted Subsidiary) within 180 days of the later of such Asset Disposition or the receipt of such Net Available Cash; and
(iii) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (i) and (ii) of this Section 4.06(1)(c), to make an Offer to purchase Securities pursuant to and subject to the conditions set forth in paragraph (2) below; provided, however, that, if Holdings elects (or is required by the terms of any series other Holdings Indebtedness), such Offer may be made ratably to purchase the Securities and other Pari Passu Indebtedness of Notes Holdings; provided, however that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (i) or (iii) of this Section 4.06(1)(c), Holdings or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Upon completion of any Offer (as defined below), the amount of Net Available Cash shall be reset at zero and Holdings shall be entitled to use any remaining proceeds for any corporate purposes to the extent permitted under this Indenture. Notwithstanding the foregoing provisions of this Section 4.06, Holdings and the Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 4.06 except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 4.06 exceeds $10,000,000.
(2) In the event of an Asset Disposition that requires the purchase of Securities pursuant to clause (1)(c)(iii) of this Section 4.06(1)(c), Holdings shall be required to offer to purchase Securities tendered pursuant to an offer to all Holders by the Company for the Securities (an "Offer") at a purchase price of such series 100% of Notestheir Accreted Value (or, redeem (including through open market purchasesif after May 14, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant 2004, principal amount plus accrued and unpaid interest thereon), and Additional Amounts in respect thereof, if any, to the redemption provisions date of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (purchase in accordance with the procedures (including prorating in the event of oversubscription) set out below);
forth in the Indenture and to purchase other Pari Passu Indebtedness on the terms and to the extent contemplated thereby. Holdings shall not be required to make an Offer for Securities (iiiand other Pari Passu Indebtedness) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect pursuant to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply this Section 4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (1)(c)(i) and, (c)(ii) of this Section 4.06(1)(c)) is less than $10,000,000 for any particular Asset Disposition (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(a) Promptly, and in any event within 10 days after Holdings becomes obligated to make an Offer, Holdings shall be obligated to deliver to the Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by Holdings either in whole or in part (subject to prorating as hereinafter described in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of Holdings which Holdings in good faith believes will enable such Holders to make an informed decision (which at a minimum shall include (i) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of Holdings, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of Holdings filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), (ii) a description of material developments in Holdings' business subsequent to the date of the latest of such reports, and (iii) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to Section 4.05(b)(ithe Offer, together with the address referred to in clause (c).
(b) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided above, Holdings shall deliver to the Trustee an Officers' Certificate as to (i) the amount of the Offer (the "Offer Amount"), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v(ii) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application the allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (iii) the compliance of such commitment until allocation with the earlier provisions of Section 4.06(1). On such date, Holdings shall also irrevocably deposit with the Trustee or with a paying agent (xor, if Holdings is acting as its own paying agent, segregate and hold in trust) an amount equal to the date on which such investment is consummated, Offer Amount to be invested pursuant to the specific written directions of Holdings in Temporary Cash Investments and (y) to be held for payment in accordance with the 180th day following provisions of this Section 4.06. Upon the expiration of the aforementioned 360-day periodperiod for which the Offer remains open (the "Offer Period"), Holdings shall deliver to the Trustee for cancellation the Securities or portions thereof that have been properly tendered to and are to be accepted by Holdings. The Trustee (or the Paying Agent, if not the investment has not been consummated Trustee) shall, on the date of purchase, mail or deliver payment to each tendering Holder in the amount of the purchase price. In the event that the Offer Amount delivered by that dateHoldings to the Trustee is greater than the purchase price of the Securities tendered, the Trustee shall deliver the excess to Holdings immediately after the expiration of the Offer Period for application in accordance with this Section 4.06.
(c) The Holders electing to have a Security purchased shall be required to surrender the Security, with an appropriate form duly completed, to Holdings at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or Holdings receives not later than one Business Day prior to the Purchase Date, a facsimile transmission or letter setting forth the name of the Holder, the principal amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited Security which was delivered by the terms Holder for purchase and a statement that such Holder is withdrawing his election to have such Secu- rity purchased. If at the expiration of this Indenturethe Offer Period the aggregate principal amount of Securities and any other Senior Subordinated Indebtedness included in the Offer surrendered by holders thereof exceeds the Offer Amount, Holdings shall select the Securities and other Pari Passu Indebtedness to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by Holdings. Holders whose Securities are purchased only in part will be issued new Securities equal in principal amount to the unpurchased portion of the Securities surrendered.
(d) On At the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, Holdings delivers Securities to the extent the Issuer electsTrustee which are to be accepted for purchase, Holdings shall also deliver an Officers' Certificate stating that such Securities are to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, be accepted by Holdings pursuant to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in terms of this IndentureSection 4.06. A Security shall be deemed to have been accepted for purchase at the time the Trustee, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereofdirectly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(e4) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer Holdings shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection 4.06. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.06, the Issuer will Holdings shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is not less than consideration at least equal to the fair market value of the assets disposed of as of (such fair market value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (Disposition), as determined in good faith by the Parent’s Board of Directors); andDirectors of the Company (including as to the value of all non-cash consideration) of the shares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents, provided that the following will be deemed to be cash:
(a) the assumption by the transferee of Indebtedness (other than Subordinated Obligations or Disqualified Stock) of the Company or Indebtedness of a Restricted Subsidiary (other than Guarantor Subordinated Obligations or Disqualified Stock of any Restricted Subsidiary that is a Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary receives from all liability on such Indebtedness in respect of connection with such Asset Disposition consists of:(in which case the Company will, without further action, be deemed to have applied such deemed cash to payment of Indebtedness in accordance with clause (3)(a) below);
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any Restricted Subsidiary from the transferee that are within 30 days of receipt converted by the Company or such Restricted Subsidiary into cash; and
(c) any Additional Assets received by the Company or such Restricted Subsidiary in consideration of connection with such Asset Disposition);; and
(B3) an amount equal to 100% of the Net Available Cash Equivalents;from such Asset Disposition is applied by the Company or such Restricted Subsidiary, as the case may be:
(Ca) first, to the assumption extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the purchaser terms of (x) any liabilities recorded on the Parent’sIndebtedness), the Issuer’s to prepay, repay or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date purchase Indebtedness of the latest balance sheet, that would be recorded on the next balance sheet) Company (other than any Disqualified Stock or Subordinated Indebtedness), as Obligations) or Indebtedness of a result of which none of the Parent, the Issuer Restricted Subsidiary (other than any Disqualified Stock or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness Guarantor Subordinated Obligations of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if Guarantor) (in each case other than Indebtedness owed to the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock Company or assets an Affiliate of the kind referred to in clause (ivCompany) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, thereof within 360 365 days (or such period as provided in clause (viii) below, if applicable) of from the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Parent Company or its such Restricted Subsidiaries may use Subsidiary will retire such Indebtedness and will cause the Net Available Cash to:related commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; and
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in second, to the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary extent of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount balance of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending after application in accordance with clause (a), to the extent the Company or such Restricted Subsidiary elects, to invest in Additional Assets within 365 days from the later of the date of such Asset Disposition or the receipt of such Net Available Cash (or within such 365 days, enter into a definitive agreement with respect thereto that is consummated within 545 days after the receipt of such Net Available Cash); provided that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture. Any Net Available Cash from Asset Dispositions that are not applied or invested as provided in, and within the time period set forth in, the preceding paragraph will be deemed to constitute "Excess Proceeds.
(d) " On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if that the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).exceeds
Appears in 1 contract
Sources: Indenture (Stewart & Stevenson LLC)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other Restricted Subsidiary to, consummate any Asset Disposition unless:
(i) unless the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Board of Directors, of the shares and assets disposed of as of the date of entry into binding documentation in respect of subject to such Asset Disposition (as determined by the Parent’s Board of Directors); and
(ii) and at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
cash or cash equivalents. For the purposes of this Section 10.13, the following are deemed to be cash or cash equivalents: (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(Cx) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer Company or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (iy) has been extinguished securities received by the Issuer Company or any Restricted Subsidiary from the applicable Guarantor, transferee that are converted by the Company or such Restricted Subsidiary into cash within 180 days after receipt thereof and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gz) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Sale having an aggregate fair market value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant that is at clause With respect to any one time outstanding, not to exceed Asset Disposition occurring on or after the greater of 15% of Consolidated EBITDA and $150 million (with Issue Date from which the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer Company or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such receives Net Available Cash, the Parent Company or its such Restricted Subsidiaries may use Subsidiary shall (i) within 360 days after the date such Net Available Cash to:
is received and to the extent the Company or such Restricted Subsidiary elects (i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) is required by the terms of any Senior Indebtedness Incurred under Section 4.01(b)(i); Indebtedness) to (bA) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled apply an amount equal to such Net Available Cash to prepay, repayrepay or purchase Indebtedness under the Senior Credit Agreements or Indebtedness secured by a Permitted Lien, purchase in each case owing to a Person other than the Company or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before any Affiliate of the Notes’ Stated Maturity only if the Parent Company, or (B) invest an equal amount, or the Issuer makes amount not so applied pursuant to clause (at such time or in compliance with this covenant) an offer to Holders to purchase NotesA), in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem Additional Assets (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness by means of an Investment in Additional Assets by a Restricted Subsidiary of with Net Available Cash received by the Parent that is not a Guarantor (other than the Issuer) Company or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any another Restricted Subsidiary);
) and (ii) purchase any series of Notes apply such excess Net Available Cash (to the extent not applied pursuant to an offer to all Holders clause (i)) as provided in the following paragraphs of such series this Section 10.13; provided, however, that in connection with any prepayment, repayment or purchase of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes Indebtedness pursuant to clause (A) above, the redemption provisions Company or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. The amount of this Indenture or by making an Asset Disposition Offer Net Available Cash required to all Holders be applied pursuant to clause (ii) above and not theretofore so applied shall constitute "Excess Proceeds." Pending application of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i)this provision, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of shall be invested in Temporary Cash Investments. If at any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds not theretofore subject to an Excess Proceeds Offer (as defined below) totals at least $60 million15 million the Company shall, not later than 30 days after the Issuer will be end of the period during which the Company is required to apply such Excess Proceeds pursuant to clause (i) of the immediately preceding paragraph of this Section 10.13(a) (or, if the Company so elects, at any time within twenty (20) Business Days thereof to such period), make an offer (“Asset Disposition an "Excess Proceeds Offer”") to all purchase from the Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum on a pro rata basis an aggregate principal amount of Notes and any such other Senior Indebtedness that may be purchased out of equal to the Excess ProceedsProceeds (rounded down to the nearest multiple of $1,000) on such date, at an offer price, in respect of the Notes, a purchase price equal to no less than 100% of the principal amount thereof plus of such Notes, plus, in each case, accrued and unpaid interest, interest (if any, to, but not including, ) to the date of purchasepurchase (the "Excess Proceeds Payment"). The Asset Disposition Upon completion of an Excess Proceeds Offer the amount of Excess Proceeds remaining
(b) Unless the Company shall have theretofore called for redemption all the outstanding Notes pursuant to Article Eleven hereof, on or before the 30th day after its becomes obligated to make an Excess Proceeds Offer, the Company or, at the written request of the Company, the Trustee, shall be obligated to mail to each Holder (and the Trustee, if applicable) at the address appearing on the Note Register, a written notice as prepared by the Company stating that the Holder may elect to have his Notes purchased by the Company either in respect of Notes will be made whole or in accordance with part (subject to prorationing as hereinafter described in the procedures set forth in this Indenture, in minimum denominations of $200,000 and event the Excess Proceeds Offer is oversubscribed) in integral multiples of $1,000 in excess thereofof principal amount, at the applicable purchase price on a date that is 60 days after the date of such notice (the "Purchase Date"). The Company shall also deliver a copy of such notice of Excess Proceeds Offer to the Trustee.
(ec) Upon completion Each notice, which shall govern the terms of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.state:
(i) The Issuer that an Excess Proceeds Offer is being made and that such Holder has the right to require the Company to purchase such Notes on the Purchase Date pursuant to this Section 10.13;
(ii) the date by which the purchase right must be exercised;
(iii) the price at which such Notes will comply, be purchased pursuant to the extent applicable, with the requirements of Section 14(eExcess Proceeds Offer; (iv) a description of the Exchange Act and any other securities laws or regulations procedures that a Holder must follow in connection with the repurchase of order to tender their Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).Excess Proceeds Offer;
Appears in 1 contract
Sources: Indenture (Signature Resorts Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is consideration (both cash and non cash) equal to not less than the fair market value of the assets disposed of as of Fair Market Value (such Fair Market Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andshares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents or Replacement Assets. For purposes of this clause (2), each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the face of the Company’s or such Restricted Subsidiary’s then most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and Subordinated Obligations) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:from further liability;
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of the cash received in consideration that conversion) within 180 days of the closing of such Asset Disposition);; and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gc) any Designated Non-Cash Noncash Consideration received by the Parent Company or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value (as determined in good faith by the Board of Directors of the Company), taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (c) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 100.0 million (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); orand
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant3) an offer amount equal to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition:
(a) first, is applied by the Company or such Restricted Subsidiary, as the case may be,
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Bank Indebtedness) to prepay, repay or purchase Bank Indebtedness of the Company or of a Restricted Subsidiary within 365 days from the date of such commitment until the earlier of Asset Disposition (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of “Application Period”), unless to the extent such Net Available Cash not is otherwise used in accordance with clause (ii); provided, however, that, in connection with any prepayment, repayment or purchase of any such Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so used prepaid, repaid or purchased, or
(ii) to the extent the Company or any Restricted Subsidiary, as the case may be, elects, to invest in Replacement Assets within the applicable Application Period; and
(b) second, to the extent of the balance of the Net Available Cash after application in accordance with (a) above (such balance, “Excess Proceeds”), is applied by the Company or such Restricted Subsidiary, as the case may be, toward an offer to purchase Notes as set forth above constitutes “Excess Proceeds.” Pending in the next succeeding paragraph; provided, however, that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) . On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time date, if any, as the Issuer electsBoard of Directors of the Company or such Restricted Subsidiary determines that the Net Available Cash will not be applied in accordance with clause (3)(a) of the first paragraph of this Section 4.15), if the aggregate amount of Excess Proceeds exceeds $60 50.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (an “Asset Disposition Offer”) to all Holders of Notes and, to the extent required by the Issuer electsterms of other Senior Indebtedness, to all or some holders of other outstanding Senior Indebtedness that is outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Indebtedness with the proceeds from any Asset Disposition (“Pari Passu Indebtedness, Notes”) to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indentureherein or the agreements governing the Pari Passu Notes, as applicable, in minimum denominations of $200,000 and each case in integral multiples of $1,000 in excess thereof.
principal amount (e) Upon completion provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such Asset Disposition Offer, other integral multiples as may be specified in the agreements governing the Pari Passu Notes. To the extent that the aggregate amount of Excess Proceeds that resulted in the requirement Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offerfor general corporate purposes, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by subject to other covenants contained in this Indenture. If the aggregate principal amount of Notes and such other Senior Indebtedness Pari Passu Notes validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee, in accordance with (in the case of Global Notes) the applicable procedures of the Depository, shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness the holders, trustees or similar representatives, as the case may be, of Pari Passu Notes shall select the Pari Passu Notes to be purchased on a pro rata based basis on the basis of the aggregate principal amount of such tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The . Each Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness and Pari Passu Notes required to be repaid or purchased by it pursuant to such offer this Section 4.15 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness Notes validly tendered in response to the Asset Disposition Offer.. Upon the commencement of an Asset Disposition Offer, the Company shall send, by first class mail, a notice to the Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Asset Disposition Offer. Any Asset Disposition Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:
(h1) that the Asset Disposition Offer is being made pursuant to this Section 4.15;
(2) the Asset Disposition Offer Amount and the Asset Disposition Purchase Date;
(3) that any Notes not tendered or accepted for payment shall continue to accrete or accrue interest;
(4) that, unless the Company defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrete or accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to the Asset Disposition Offer may only elect to have all of such Note purchased and may not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Asset Disposition Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by book-entry transfer, to the Company, a depository, if appointed by the Company, or the Paying Agent at the address specified in the notice at least three days before the Asset Disposition Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the Company, the Depository or the Paying Agent, as the case may be, receives, not later than the second business day prior to the Asset Disposition Purchase Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased);
(9) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(10) all other procedures, if any, determined by the Company, consistent with this Indenture, that a Holder must follow in order to have its Notes purchased in the Asset Disposition Offer. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, any accrued and unpaid interest will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of such Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in each case in integral multiples of $1,000 in principal amount (provided that the unpurchased portion of any Note shall not be less than $2,000 in principal amount) or, in the case of Pari Passu Notes, in such other integral multiples as may be specified in the agreements governing such Pari Passu Notes. The Parent Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4.15 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount of $2,000 or an integral multiple of $1,000 in excess thereof. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Notes. Any Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Disposition Offer on or promptly following the Asset Disposition Purchase Date. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries may satisfy as an entirety to a Person in a transaction permitted under Article 5, which transaction does not constitute a Change of Control, the foregoing obligations successor company shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Disposition. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Available Cash prior to the expiration for purposes of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) Section 4.15. The Issuer Company will comply, to the extent applicable, with the requirements of Section Rule 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.15. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.15, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such complianceany conflict.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the Parent, time of the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than Sale at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of as determined in good faith by the Board of Directors of the date Company (including the value of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors); all non-cash consideration); and
(ii2) at least 75% of the consideration received for the Parent assets sold by the Company or such the Restricted Subsidiary, as the case may be, in the Asset Sale will be in the form of cash, Cash Equivalents or assets or Capital Stock which the Company or a Permitted Investing Subsidiary receives in respect of would be permitted to use the Net Cash Proceeds from such Asset Disposition consists ofSale to purchase or invest in, if any, pursuant to clause (2) of Section 3.12(b). For the purposes of this clause (2), the following are deemed to be cash:
(A) cash (including any Net Cash Proceeds received from Indebtedness and other liabilities shown on the conversion within 180 days most recent consolidated balance sheet of the Company prior to the date of such Asset Disposition Sale (other than Subordinated Indebtedness) (i) that are assumed or repaid or otherwise extinguished by the transferee of any such assets and (ii) for which the Company and its Restricted Subsidiaries are released from all liability at the time of such Asset Sale;
(B) any securities, notes or other obligations Obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted, sold or exchanged by the Company or such Restricted Subsidiary into cash or Cash Equivalents within 90 days, to the extent of the cash or Cash Equivalents received in consideration of such Asset Disposition);
(B) Cash Equivalents;that conversion, sale or exchange; and
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (iii) that is at any one that time outstanding, not to exceed the greater of 15(x) $20.0 million and (y) 5.5% of Consolidated EBITDA and $150 million (LTM EBITDA, with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If The Company or a Restricted Subsidiary, as the Parentcase may be, may (subject to the Issuer or provisos below) apply the Net Cash Proceeds of any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash Sale within 365 days thereof to:
(i) (a1) prepay, repay, purchase purchase, repurchase, redeem, retire, defease or redeem otherwise retire for value (including through open market purchasescollectively, voluntary tender offers or privately negotiated transactions at market prices“repay”) any Senior Indebtedness Incurred under Section 4.01(b)(i); any:
(bA) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any secured Indebtedness of the Company or a Restricted Subsidiary;
(B) Indebtedness of any Restricted Subsidiary of the Parent that is not a Guarantor Note Guarantor; or
(C) any Senior Indebtedness, provided that, if the Company repays any Senior Indebtedness other than the Notes pursuant to this clause (iii), it must repay Notes or make an offer to repurchase the Notes at a price equal to or above 100% of the principal amount thereof, whether or not the Holders accept such offer, in each case on a pro rata basis with such other Senior Indebtedness; in the case of each of clauses (i) through (iii) above, constituting Indebtedness for borrowed money or Capitalized Lease Obligations, and permanently reduce the commitments with respect thereto without Refinancing; or
(2) purchase or otherwise invest in:
(A) assets (other than the Issuer) or any Indebtedness that is secured on current assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (as determined in accordance with GAAP or Capital Stock) to be used by the procedures set out below);Company or a Permitted Investing Subsidiary in a Permitted Business or capital expenditures;
(iiiB) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, of a Permitted Business or any properties; or
(C) Capital Stock of, another : (A) a Restricted Subsidiary held by a Person other than the Company or any of its Subsidiaries or (B) a Person engaged in a Similar BusinessPermitted Business that becomes, ifupon the purchase or investment, after giving effect to any such acquisition a Restricted Subsidiary or, in the case of an Asset Sale in respect of assets or Capital Stock, such Person is or becomes Stock of a Restricted Subsidiary;
(v) make , a capital expenditure;
(vi) acquire other assets (other than Restricted Subsidiary of which the Company owns, directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock and cash or Cash Equivalentsas it does (immediately prior to such Asset Sale) that are used or useful in a Similar Business;
(vii) consummate any combination respect of the foregoing; Restricted Subsidiary whose assets or Capital Stock are included in such Asset Sale; or
(viii3) enter into a binding commitment to apply repay Indebtedness arising from agreements of the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) Company or a combination thereof; Restricted Subsidiary providing for adjustment of purchase price, deferred consideration, earn outs or similar obligations, in each case incurred in connection with the purchase or investment by the Company or a Restricted Subsidiary of or in assets or Capital Stock that occurred prior to such Asset Sale, and solely to the extent such repayment would be permitted under Section 3.12 (b)(2) herein if such purchase or investment had occurred immediately following the consummation of such Asset Sale; provided thatthat such purchase or investment shall have occurred not more than 365 days prior to such Asset Sale; provided that in the case of Section 3.12 (b)(2) above, (A) the following Persons may make a purchase or investment in accordance with the foregoing: (x) the Company, (y) a Wholly Owned Subsidiary or (z) in the case of an Asset Sale in respect of assets or Capital Stock held by a Restricted Subsidiary only, a Restricted Subsidiary of which the Company, owns directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock as it does of the Restricted Subsidiary that made such Asset Sale and (B) no purchase from the Company or any Subsidiary of the Company will satisfy the provisions of Section 3.12 (b)(2) above (each, other than the Company, a “Permitted Investing Subsidiary”); provided that (x) in the case of Section 3.12 (b)(2) above, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Company, or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”) and such Net Cash Proceeds are actually applied to satisfy such commitment within the later of (xi) 365 days after receipt of the Net Cash Proceeds from the related Asset Sale and (ii) 180 days after the date on which of such investment is consummated, binding commitment and (y) to the 180th day following extent such Net Cash Proceeds are not actually applied to satisfy such commitment within the expiration of period set forth in clause (x) above, the aforementioned 360-day period, if the investment has Net Cash Proceeds not been consummated by that dateso applied shall constitute Excess Proceeds.
(c) The amount To the extent all or a portion of the Net Cash Proceeds of any Asset Sale are not applied within 365 days thereof (or such Net Available Cash not so used longer period as set forth permitted pursuant to an Acceptable Commitment as provided in Section 3.12(b) above) as described in clause (1) or (2) of Section 3.12(b) above constitutes (“Excess Proceeds.” Pending the final application of any such Net Available Cash”), the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer to purchase Notes (an “Asset Disposition Sale Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds), at an offer price, in respect of the Notes, a purchase price equal to no less than 100% of the principal amount thereof of the Notes to be purchased, plus accrued and unpaid interestinterest thereon, if any, to, but not including, to the date of purchasepurchase (the “Asset Sale Offer Amount”). The Company will purchase pursuant to an Asset Disposition Sale Offer from all tendering Holders on a pro rata basis in respect the manner provided in Section 5.5, and, at the Company’s option, on a pro rata basis with the holders of any other Senior Indebtedness with similar provisions requiring the Company to offer to purchase the other Senior Indebtedness with the proceeds of Asset Sales, that principal amount (or accreted value in the case of Indebtedness issued with original issue discount) of Notes and the other Senior Indebtedness to be purchased equal to such Excess Proceeds. The Company may satisfy its Obligations under this Section 3.12 with respect to any Excess Proceeds by making an Asset Sale Offer at the Asset Sale Offer Amount prior to the expiration of 365 days from the relevant Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b) above, the later date of the 365th day following the Asset Sale or the expiration of the 180-day period set forth in Section 3.12(b) above).
(d) The purchase of Notes pursuant to an Asset Sale Offer will occur not less than 20 Business Days following the date thereof, or any longer period as may be required by law, nor more than 45 days following the 365th day following the Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b), the later date of the 365th day following the Asset Sale or the expiration of the 180-day period set forth in such Section 3.12(b)). The Company may, however, defer an Asset Sale Offer until there is an aggregate amount of Excess Proceeds from one or more Asset Sales equal to or in excess of $25.0 million. At that time, the entire amount of Excess Proceeds, and not just the amount in excess of $25.0 million, will be made applied as required pursuant to this Section 3.12. Pending application in accordance with this Section 3.12, Net Cash Proceeds may be applied to reduce revolving credit borrowings, Invested in Cash Equivalents or used for general corporate purposes in accordance with this Indenture.
(e) Each Asset Sale Offer Notice will be mailed first class, postage prepaid, to the procedures record Holders as shown on the register of Holders within 30 days following such 365th day (or, in the event an Acceptable Commitment has been entered into as set forth in this IndentureSection 3.12(b) above, the later date of the 365th day following the Asset Sale or the expiration of the 180-day period set forth in minimum denominations such Section 3.12(b)), with a copy to the Trustee offering to purchase the Notes as described above. Each Asset Sale Offer Notice will state, among other things, the purchase date, which must be no earlier than 10 days nor later than 60 days from the date the notice is mailed, other than as may be required by law (the “Asset Sale Offer Payment Date”). Upon receiving notice of an Asset Sale Offer, Holders may elect to tender their Notes in whole or in part in a principal amount of $200,000 and in 2,000 or integral multiples of $1,000 in excess thereofthereof in exchange for cash.
(ef) On the Asset Sale Offer Payment Date, the Company will, to the extent lawful:
(1) accept for payment all Notes or portions thereof properly tendered pursuant to the Asset Sale Offer;
(2) deposit with the Paying Agent funds in an amount equal to the Asset Sale Offer Amount in respect of all Notes or portions thereof so tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Company.
(g) To the extent Holders of Notes and holders of other Senior Indebtedness, if any, which are the subject of an Asset Sale Offer properly tender and do not withdraw Notes or the other Senior Indebtedness in an aggregate amount exceeding the amount of Excess Proceeds, the Company will purchase the Notes and the other Senior Indebtedness on a pro rata basis (based on amounts tendered). If only a portion of a Note is purchased pursuant to an Asset Sale Offer, a new Note in a principal amount equal to the portion thereof not purchased will be issued in the name of the Holder thereof upon cancellation of the original Note (or appropriate adjustments to the principal amount of a Global Note will be made, as appropriate). Notes (or portions thereof) purchased pursuant to an Asset Sale Offer will be cancelled and cannot be reissued. Upon completion of any such an Asset Disposition Sale Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall will be reset at zero. Accordingly, to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If extent that the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer exceeds is less than the aggregate amount of Excess Proceeds, the Excess Company may use any remaining Net Cash Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the for general corporate purposes of calculating the principal amount of any such Indebtedness tendered Company and its Restricted Subsidiaries in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offeraccordance with this Indenture.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer Company will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other applicable securities laws or regulations in connection with the repurchase purchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any applicable securities laws or regulations conflict with provisions of this Section 4.053.12, the Issuer Company will comply with the applicable securities these laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 3.12 by virtue of such compliancedoing so.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Stagwell Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition is not less than at least equal to the fair market value of the assets disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined in good faith by the Parent’s Board Company) of Directors); and
the shares and assets subject to such Asset Disposition, (ii) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of cash or cash equivalents (provided that the amount of (w) any liabilities (as shown on the Company's or such Asset Disposition consists of:
Restricted Subsidiary's most recent balance sheet or in the notes thereto) of the Company or any Restricted Subsidiary (Aother than liabilities that are by their terms subordinated to the Senior Subordinated Notes) cash that are assumed by the transferee of any such assets without recourse to the Company or any of the Restricted Subsidiaries, (including x) any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the notes thereto (or, if Incurred since the date extent of the latest balance sheet, that would be recorded on cash received) within 180 days following the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result closing of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gy) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (y) that is at any one that time outstanding, not to exceed the greater of 155% of Adjusted Consolidated EBITDA and $150 million Assets at the time of the receipt of such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
) and (Hz) any combination assets received in exchange for assets related to a Related Business of comparable market value in the good faith determination of the types Board of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries Directors shall be entitled deemed to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below be cash for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions purposes of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
provision) and (iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect an amount equal to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset
(a) except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 4.06 (a) exceeds $20.0 million.
(b) In the event of an Asset Disposition that requires the purchase of Senior Subordinated Notes (and other Senior Subordinated Indebtedness of the Company) pursuant to Section 4.06(a)(iii)(C), the Company shall be required to purchase Senior Subordinated Notes (and other Senior Subordinated Indebtedness of the Company) tendered pursuant to an offer by the Company for the Senior Subordinated Notes (and other Senior Subordinated Indebtedness of the Company) (the "Offer") at a purchase price of 100% of their principal amount plus accrued and unpaid interest and liquidated damages, if any, to the date of such commitment until purchase in accordance with the earlier procedures (including prorating in the event of oversubscription), set forth in Section 4.06(c). If the aggregate purchase price of Senior Subordinated Notes (x) the date on which such investment is consummated, and (y) the 180th day following the expiration other Senior Subordinated Indebtedness of the aforementioned 360-day period, if Company) tendered pursuant to the investment has not been consummated by that date.
(c) The amount of such Offer is less than the Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending allotted to the final application purchase of any such Net Available Cashthe Senior Subordinated Notes (and other Senior Subordinated Indebtedness of the Company), the Parent or any Restricted Subsidiary Company may temporarily reduce revolving credit borrowings or otherwise utilize such apply the remaining Net Available Cash in for any manner that is not prohibited purpose permitted by the terms of this Indenture. The Company shall not be required to make an Offer for Senior Subordinated Notes (and other Senior Subordinated Indebtedness of the Company) pursuant to this Section 4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (A) and (B) of Section 4.06(a)(iii)) is less than $10.0 million for any particular Asset Disposition (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(dc) On (1) Promptly, and in any event within 30 days after the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof Company becomes obligated to make an offer (“Asset Disposition Offer”) , the Company shall be obligated to all Holders and, deliver to the extent Senior Subordinated Notes Trustee and send, by first-class mail to each Senior Subordinated Noteholder, a written notice stating that the Issuer elects, Senior Subordinated Noteholder may elect to all have his Senior Subordinated Notes purchased by the Company either in whole or some holders of other outstanding Senior Indebtedness that in part (subject to prorating as hereinafter described in the event the Offer is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain or incorporate by reference such information concerning the business of the Company which the Company in excess thereof.
(e) Upon completion of any good faith believes will enable such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement Senior Subordinated Noteholders to make an Asset Disposition Offer shall be reset informed decision and all instructions and materials necessary to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other tender Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Subordinated Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Offer, the Issuer will comply together with the applicable securities laws and regulations and will not be deemed address referred to have breached its obligations under this Indenture by virtue of such compliance.
in clause (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes3).
Appears in 1 contract
Sources: Indenture (Wesco Distribution Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
(i) the consideration the Parent, the Issuer The Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (at least equal to the fair market value, as determined in good faith by the Parent’s Board Company (including as to the value of Directorsall non-cash consideration); and
(ii) , of the shares and assets subject to such Asset Disposition and at least 75% of the consideration thereof received, together with all other Asset Dispositions since the Parent Existing Notes Issue Date (on a cumulative basis), by the Company or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of such cash or Cash Equivalents; provided, however, that in the case of an Asset Disposition consists of(x) involving the disposition of non-core assets (as determined by the Company in its good faith judgment) acquired as part of any acquisition after the Issue Date or (y) for aggregate consideration of less than $100.0 million, only 50% of the consideration therefor must be in the form of cash or Cash Equivalents; provided further that:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securitiespromissory notes, notes securities or other obligations or amounts received in consideration by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash within 360 days of such Asset Dispositionthe receipt thereof (to the extent of the cash received) shall be deemed to be cash solely for purposes of this Section 10.16(a)(i);, and
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash cash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant Section 10.16(a)(i)(B) that is at any one that time outstanding, not to exceed the greater of 15(x) $150.0 million and (y) 6.0% of Consolidated EBITDA and $150 million Tangible Assets at the time of receipt of such Designated Non-cash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled deemed to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with be cash solely for purposes of this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted SubsidiarySection 10.16(a)(i);
(ii) purchase any series of Notes pursuant an amount equal to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be), at its option except as described below:
(A) (x) to the extent the Company elects (or is required by the terms of any Senior Indebtedness or any Indebtedness of any non-Guarantor Subsidiary), to prepay, repay or purchase Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary of the Company within 365 days of such Asset Disposition, (y) at the Company’s election to the investment by the Company or such Restricted Subsidiary in assets to replace the assets that were the subject of such Asset Disposition or assets that (as determined in good faith by the Company) are directly related to the business of the Company and the Restricted Subsidiaries existing on the Issue Date, in each case within 365 days from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or (z) a combination of the foregoing purposes within such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty 365-day period;
(20B) Business Days thereof to make an a pro rata offer to purchase Notes at par (“Asset Disposition Offer”) to all Holders and, to the extent required by the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu instrument governing such Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out or Indebtedness of a non-Guarantor Subsidiary designated by the Excess ProceedsCompany, at an offer price, in respect of the Notes, equal to a price no less greater than 100% of the principal amount thereof par) plus accrued and unpaid interest, which offer can be made at the Company’s election at any time during the 365-day period set forth in Section 10.16(a)(ii)(A) or within 10 Business Days after such period, and
(C) to the extent of the balance of such Net Available Cash after application in accordance with Sections 10.16(a)(ii)(A) and 10.16(a)(ii)(B), for general corporate purposes otherwise permitted under this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to Sections 10.16(a)(ii)(A) and 10.16(a)(ii)(B), the Company or such Subsidiary shall retire such Indebtedness and cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 10.16, the Company and its Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 10.16 except to the extent that the aggregate Net Available Cash from all Asset Dispositions (including any Asset Dispositions made since the Issue Date) which are not applied in accordance with this Section 10.16 exceeds $50.0 million. For the purposes of this Section 10.16, the following is deemed to be cash or Cash Equivalents: the express assumption of Indebtedness (other than any Indebtedness that is by its terms subordinated to the Notes or to any Subordinated Obligation) of the Company or any Restricted Subsidiary and for which the Company or such Restricted Subsidiary has been validly released by all creditors in writing.
(b) In the event of an Asset Disposition that results in an offer to purchase the Notes (and other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) pursuant to Section 10.16(a)(ii)(B), the Company or such Restricted Subsidiary shall purchase Notes tendered pursuant to an offer by the Company for the Notes (and, to the extent required, other Senior Indebtedness of any non-Guarantor Subsidiary) at a purchase price of 100% of their principal amount (without premium) plus accrued but unpaid interest (or, in respect of such other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary, such lesser price, if any, toas may be provided for by the terms of such Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made as applicable) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this IndentureIndenture which shall include, among other things, that the offer shall remain open for 20 Business Days following its commencement. If the aggregate purchase price of Notes (and, to the extent required, any other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) tendered pursuant to such offer is less than the Net Available Cash allotted to the purchase thereof, the Company shall be entitled to apply the remaining Net Available Cash in minimum denominations accordance with Section 10.16(a)(ii)(A) or (C). The Company shall not be required to make such an offer to purchase Notes (and other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) pursuant to this Section 10.16 if the Net Available Cash available therefor is less than $200,000 50.0 million (which lesser amount shall be carried forward for purposes of determining whether such an offer is required with respect to any subsequent Asset Disposition). The Company shall not be required to make such an offer to purchase Notes (and other Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary) pursuant to this Section 10.16 if a third party (including any of the Company’s Restricted Subsidiaries) makes the offer in integral multiples of $1,000 the manner, at the times and otherwise in excess thereof.
(e) compliance with the requirements set forth in this Indenture applicable to such an offer by the Company and purchases all Notes validly tendered and not withdrawn under such offer. Upon completion of any such Asset Disposition Offeroffer by the Company for Notes, the amount of Excess Proceeds that resulted in the requirement Net Available Cash related to make an such Asset Disposition Offer shall be reset to zero (regardless zero, and during the pendency of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected offer by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Company for Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash being effected in advance of being required to do so by this Indenture, the amount of Net Available Cash the Company is offering to apply in such offer shall be excluded in subsequent calculations of Net Available Cash in respect of subsequent Asset Dispositions. Pending the final application of any Net Available Cash pursuant to Section 10.16(a)(ii), the Company or the applicable Restricted Subsidiary may apply such Net Available Cash temporarily to reduce Indebtedness outstanding under a revolving credit facility or otherwise invest such Net Available Cash in Cash Equivalents or Investment Grade Securities.
(ic) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 10.16. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.0510.16, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 10.16(c) by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Terex Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition Sale unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition Sale at least equal to the Fair Market Value (including the value of all non-cash consideration), as determined in good faith by the Parent’s Board of Directors), of the shares and assets subject to such Asset Sale; and
(ii2) at least 75% of the consideration received by the Parent Company or such Restricted Subsidiary receives therefor is in respect of such Asset Disposition consists the form of:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition)cash;
(B) Cash Equivalents;
(C) the assumption by the purchaser of liabilities (x) any liabilities recorded as shown on the Parent’s, the Issuer’s Company's or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next 's most recent balance sheet) of the Company or any such Restricted Subsidiary (other than Subordinated Indebtedness), as a result liabilities that are by their terms subordinated to the Notes) by the transferee of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Dispositionassets;
(D) Replacement Assetsany notes or other obligations received by the Company or any such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash within 90 days of the receipt thereof (to the extent of the cash received);
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Sale having an aggregate aggre- gate fair market value, when taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (E) that is at any one time then outstanding and all Investments made pursuant to Section 4.07(b)(5) that are then outstanding, not to exceed the greater of 155% of Consolidated EBITDA and $150 million the Total Assets of the Company at the time of the receipt of such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value);
(F) Telecommunications Assets and Capital Stock in any Person primarily engaged in the Telecommunications Business; or
(HG) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)foregoing.
(b) If Within 365 days after the Parentreceipt of any Net Available Cash from an Asset Sale, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (Company or such period Restricted Subsidiary, as provided in clause (viii) belowthe case may be, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of may apply such Net Available Cash, the Parent or Cash at its Restricted Subsidiaries may use the Net Available Cash tooption:
(i1) to repay or retire
(aA) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior secured Indebtedness Incurred by the Company, including Indebtedness under Section 4.01(b)(i); Credit Agreements, or
(bB) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) Indebtedness Incurred by any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, case other than Subordinated Indebtedness of the Issuer or a Guarantor or any Indebtedness owed to the Parent Company or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii2) enter into to acquire Telecommunications Assets or Capital Stock in any Person primarily engaged in the Telecommunications Business or to make a binding commitment capital expenditure or to apply design, improve or expand the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Network. Pending the final application of any such Net Available Cash, the Parent Company or any such Restricted Subsidiary may temporarily reduce revolving credit borrowings borrowings, if any, or otherwise utilize invest such Net Available Cash in any manner Cash Equivalents.
(c) Any Net Available Cash from Asset Sales that is not prohibited by applied or invested as provided in paragraph (b) above on or prior to the terms of this Indenture.
(d) On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Sale or such earlier time date, if any, as the Issuer elects, if Board of Directors or the board of directors of such Restricted Subsidiary determines not to apply the Net Available Cash relating to such Asset Sale as set forth in paragraph (b) above will constitute "EXCESS PROCEEDS." When the aggregate amount of Excess Proceeds exceeds $60 million5.0 million (each, a "NET PROCEEDS OFFER TRIGGER DATE"), the Issuer Company will be required within twenty (20) Business Days thereof to make an offer to purchase (“Asset Disposition Offer”the "NET PROCEEDS OFFER") on a date (the "NET PROCEEDS OFFER PAYMENT DATE") not less than 30 nor more than 60 days following the applicable Net Proceeds Offer Trigger Date, to all Holders and, to the extent the Issuer elects, to of Notes and all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, PARI PASSU with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem with the proceeds of sales of assets to purchase the maximum principal amount of Notes and any such other Senior PARI PASSU Indebtedness that may be purchased out of the Excess Proceeds, at an . The offer price, price in respect of the Notes, any such offer to purchase will be equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, thereon to the date of purchase. The Asset Disposition Offer in respect of Notes purchase and will be made payable in cash. If at any time any non-cash consideration (including any Designated Noncash Consideration) received by the Company or any Restricted Subsidiary of the Company, as the case may be, in connection with any Asset Sale is converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then such conversion or disposition shall be deemed to constitute an Asset Sale hereunder and the Net Cash Proceeds thereof shall be applied in accordance with this Section 4.10.
(d) Notice of each Net Proceeds Offer will be mailed to the record Holders as shown on the register of Holders within 30 days following the Net Proceeds Offer Trigger Date, with a copy to the Trustee, and shall comply with the procedures set forth in this Indenture, in minimum denominations Section 3.09 hereof. If any Excess Proceeds remain after consummation of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offeran offer to purchase, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries Company may use such Net Available Cash Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition a Net Proceeds Offer exceeds the amount of Excess ProceedsProceeds allocable to the Notes, the Excess Proceeds Trustee shall select the Notes to be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based purchased on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPRO RATA basis. Upon completion of any Asset Disposition such Net Proceeds Offer, the amount Amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(ge) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or and regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.10. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.10, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section 4.10 by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer any of its Restricted Subsidiaries to, directly or any other Restricted Subsidiary toindirectly, consummate any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other a Restricted Subsidiary receives for such Asset Disposition is not less than consideration at least equal to the fair market value of the assets disposed of Fair Market Value (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by Disposition), of the Parent’s Board of Directors); andassets and Equity Interests issued or sold pursuant to such Asset Disposition;
(ii2) at least 75% of the consideration received by the Parent Company or its Restricted Subsidiaries is in the form of cash or Temporary Cash Investments, Additional Assets or any combination thereof (collectively, the “Cash Consideration”); provided that each of the following will be deemed to be cash:
(a) any liabilities, as shown on the Company’s most recent consolidated balance sheet, of the Company or any Restricted Subsidiary (other than contingent liabilities and liabilities that are by their terms subordinated to the Securities or any Subsidiary Guarantee) that are assumed or otherwise forgiven by the transferee by written agreement that releases the Company or such Restricted Subsidiary receives in respect of from or indemnifies the Company or such Asset Disposition consists of:Restricted Subsidiary against further liability;
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Company or any liabilities recorded on Restricted Subsidiary from the Parent’stransferee that are, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date within 180 days of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if converted by the Parent, the Issuer and every other Company or such Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parentinto cash, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;cash received in that conversion; and
(Gc) any Designated Non-Cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstandingclause (d), not to exceed the greater of 15an amount equal to 5.0% of the Company’s Consolidated EBITDA and $150 million Net Tangible Assets (determined at the time of receipt of such Designated Non-Cash Consideration), with the fair market value Fair Market Value of each issue item of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); orand
(H3) any combination an amount equal to 100% of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash from such Asset Disposition is applied by the Company (or a Restricted Subsidiary, as the case may be) within 365 days to:
(i) (a) prepay, repay, redeem, reduce or purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Priority Lien Debt and that has other outstanding Priority Lien Obligations or any Parity Lien Debt and other outstanding Parity Lien Obligations, provided that, with respect to any such prepayment, repayment, redemption or purchase of Parity Lien Debt or Parity Lien Obligations other than the Securities, a Stated Maturity falling before ratable portion of the Notes’ Stated Maturity only if the Parent Securities must be redeemed or the Issuer makes repurchased (at such time or in compliance with this covenantoffered to be repurchased) an offer to Holders to purchase Notes, in accordance with the Excess Proceeds Offer provisions set forth below below;
(b) acquire Additional Assets (that, other than Excluded Assets, must become Collateral subjected to a second-priority Lien in favor of the Collateral Trustee for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount benefit of Notes then outstanding in the same proportion as the aggregate principal amount holders of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptionsParity Lien Obligations); or or
(c) prepaymake capital expenditures in a Permitted Business. The requirement of clauses (3)(b) and (3)(c) of the preceding paragraph of this Section 3.5 shall be deemed to be satisfied if a bona fide binding contract committing to make the investment, repay, purchase acquisition or redeem expenditure referred to therein is entered into by the Company (including through open market purchases, voluntary tender offers or privately negotiated transactions at market pricesany Restricted Subsidiary of the Company) any Indebtedness of with a Person other than a Restricted Subsidiary of the Parent that Company within the time period specified in the preceding paragraph and such Net Available Cash is not a Guarantor (other than subsequently applied in accordance with such contract within six months following the Issuer) or any Indebtedness that date such agreement is secured on assets that do not constitute Collateral (in each caseentered into. Except as provided above, other than Subordinated Indebtedness pending application of Net Available Cash pursuant to this Section 3.5, the Issuer or a Guarantor or Indebtedness owed to the Parent Company or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders Subsidiary of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to Company may apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of temporarily reducing Indebtedness under any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings Credit Facility or otherwise utilize such invest the Net Available Cash in any manner that is not prohibited by the terms of this Indenture. The amount of Net Available Cash not applied or invested as provided above will constitute “Excess Proceeds.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if ” When the aggregate amount of Excess Proceeds equals or exceeds $60 25.0 million, the Issuer will be required within twenty (20) Business Days thereof to Company shall make an offer to purchase Securities, and, if required by the terms of other Parity Lien Debt, to holders of such other Parity Lien Debt (an “Asset Disposition Offer”) within 30 days, and shall purchase Securities tendered pursuant to all Holders an Asset Disposition Offer by the Company for the Securities (and, to the extent the Issuer electsif applicable, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out Parity Lien Debt) at a purchase price of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the their principal amount thereof without premium, plus accrued and but unpaid interest, if any, interest to, but not including, the date of purchase, subject to the right of Holders of record on the relevant record date to receive interest on the relevant interest payment date (or, in respect of such other Parity Lien Debt, such lesser price, if any, as may be provided for by the terms of such Parity Lien Debt) in accordance with the procedures (including prorating in the event of oversubscription) set forth below in this Section 3.5. Upon completion of an Asset Disposition Offer, Excess Proceeds will be deemed to be reset to zero. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness Securities and such other Parity Lien Debt as may be required to be repaid or purchased by it pursuant to such offer this Section 3.5 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tenderedtendered and not properly withdrawn, all Notes Securities and Senior Indebtedness that is Pari Passu Indebtedness such other Parity Lien Debt validly tendered and not properly withdrawn in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy . If the foregoing obligations with respect to any Net Available Cash from an Asset Disposition Purchase Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest, if any, will be paid to the Person in whose name a Security is registered at the close of business on such record date, and no further interest will be payable to Holders who tender Securities pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, to the extent necessary on a pro rata basis (except that any Securities represented by making an a Security in global form will be selected by such method as DTC or its nominee or successor may require or, where such nominee or successor is the Trustee, a method that most nearly approximates pro rata selection as the Trustee deems fair and appropriate unless otherwise required by law), the Asset Disposition Offer Amount of Securities and such other Parity Lien Debt or portions of Securities and such other Parity Lien Debt so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Securities and such other Parity Lien Debt so validly tendered and not properly withdrawn, in each case in minimum principal amount of $2,000 and integral multiples of $1,000 in excess of $2,000; provided that if, following the repurchase of a portion of a Security, the remaining principal amount of such Security outstanding immediately after such repurchase would be less than $2,000, then the portion of such Security so repurchased shall be reduced such that the remaining principal amount of such Security outstanding immediately after such repurchase is $2,000. The Company will deliver to the Trustee an Officers’ Certificate stating that such Securities or portions thereof were accepted for payment by the Company in accordance with respect the terms of this Section 3.5 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing other Parity Lien Debt. The Company or the paying agent, as the case may be, will promptly (but in any case not later than five Business Days after the termination of the Asset Disposition Offer Period) mail (or otherwise deliver in accordance with the applicable procedures of DTC) to each tendering Holder of Securities or holder or lender of such other Parity Lien Debt, as the case may be, an amount equal to the purchase price of the Securities or such other Parity Lien Debt so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Security, and the Trustee, upon delivery of an authentication order from the Company, will authenticate and mail or deliver such new Security to such Net Available Cash prior Holder, in a principal amount equal to any unpurchased portion of the Security surrendered; provided that each such new Security will be in a minimum principal amount of $2,000 or an integral multiple of $1,000 in excess of $2,000. In addition, the Company will take any and all other actions required by the agreements governing such other Parity Lien Debt. Any Security not so accepted will be promptly mailed or delivered by the Company to the expiration Holder thereof. The Company will publicly announce the results of the relevant 360 days (or such longer period provided above) respect to all or part of Asset Disposition Offer on the Net Available Cash in advance of being required to do so by this Indenture.
(i) Asset Disposition Purchase Date. The Issuer Company will comply, to the extent applicable, with the requirements of Section 14(e) Rule 14e-1 of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this Indenturean Asset Disposition Offer. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.053.5, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes)securities laws or regulations.
Appears in 1 contract
Sources: Indenture (CONSOL Mining Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Issuer will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale, unless:
(i1) the Issuer (or the Restricted Subsidiary, as the case may be) receives consideration at the Parent, the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than the fair market value time of the assets disposed of Asset Sale at least equal to the Fair Market Value (determined as of the date of entry into binding documentation in respect of contractual agreement to such Asset Disposition (as determined by Sale) of the Parent’s Board of Directors)assets or Equity Interests issued or sold or otherwise disposed of; and
(ii2) at least 75% of the consideration received in the Parent Asset Sale by the Issuer or any of its Restricted Subsidiaries is in the form of cash, Cash Equivalents or Replacement Assets. For purposes of this provision, each of the following will be deemed to be cash:
(i) any Indebtedness or liabilities, as shown on the Issuer’s most recent consolidated balance sheet or in the footnotes thereto (or, if incurred or accrued subsequent to the date of such balance sheet, such liabilities that would have been reflected on the Issuer’s most recent consolidated balance sheet or in the footnotes thereto if such incurrence or accrual had taken place on or prior to the date of such balance sheet, as determined in good faith by the Issuer), of the Issuer or any of its Restricted Subsidiaries (other than contingent liabilities and liabilities that are by their terms subordinated to the Notes or any Note Guarantee) that are assumed by the transferee of any such assets and for which the Issuer or such Restricted Subsidiary receives has been released in respect of such Asset Disposition consists of:writing;
(Aii) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any such Restricted Subsidiary from such transferee that are converted by the Issuer or such Restricted Subsidiary into cash or Cash Equivalents within 180 days of the other Restricted Subsidiaries remains obligated receipt thereof, to the extent of the cash or Cash Equivalents received in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Dispositionconversion;
(D) Replacement Assets;
(Eiii) any Capital Stock stock or assets of the kind referred to in clause clauses (iv2) or (vi4) of Section 4.05(b3.5(b);; and
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Giv) any Designated Non-Cash cash Consideration received by the Parent Issuer or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market value, Fair Market Value (with the Fair Market Value of each item of Designated Non-cash Consideration being determined as of the date of contractual agreement to such Asset Sale) taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (d) that is at any one that time outstanding, outstanding not to exceed exceed, at the time of determination, the greater of 15$35.0 million and 15.0% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in Issuer and its Restricted Subsidiaries for the preceding clauses (ii)(A) through (ii)(G)most recently ended four fiscal quarters for which internal financial statements are available.
(b) If Within 365 days after the Parentreceipt of any Net Proceeds from an Asset Sale, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (one or such period as provided in clause (viii) below, if applicable) more of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use apply an amount equal to such Net Proceeds at its option to any combination of the Net Available Cash tofollowing:
(i1) (ax) prepayif assets subject to such Asset Sale constitute Collateral, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repayrepay or purchase (i) Indebtedness and other Obligations under the Credit Agreement (or any Permitted Refinancing Indebtedness in respect thereof), purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before (ii) Obligations in respect of the Notes’ Stated Maturity only if the Parent or the Issuer makes , (at such time or iii) Obligations in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount respect of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; debt securities constituting First-Lien Obligations or (civ) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on by the assets that which are the subject of such Asset Sale and (y) if assets subject to such Asset Sale do not constitute Collateral (in each caseCollateral, other than Subordinated to prepay, repay or purchase Senior Indebtedness of the Issuer or a Guarantor or any of its Restricted Subsidiaries (other than Indebtedness owed to the Parent Issuer or any another Restricted Subsidiary);
(ii) ; provided that in connection with any prepayment, repayment or purchase any series of Indebtedness other than Obligations in respect of the Notes pursuant to an offer to all Holders of such series of Notesclause (1)(x)(iii) or (iv), redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of the Issuer shall also equally and ratably reduce Indebtedness under the Notes pursuant to the redemption provisions of this Indenture or by making an offer (an “Asset Disposition Offer to all Holders of the Notes Sale Offer”) (in accordance with the procedures set out belowforth below for an Asset Sale Offer with Excess Proceeds) to all Holders to purchase, on a pro rata basis (subject to adjustments to maintain the authorized denominations for the Notes), the principal amount of Notes, in each case, at a purchase price equal to 100% of the principal amount (or accreted value, as applicable) plus any accrued and unpaid interest on the Notes to be purchased up to, but excluding, the date of such purchase;
(iii2) invest in any Replacement Assets;
(iv) to acquire all or substantially all of the assets of, a division or any line of business of or a majority of the Capital Stock of, another Person engaged in a Similar Permitted Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted SubsidiarySubsidiary of the Issuer;
(v3) to make a capital expenditureexpenditure or other expenditures in connection with the construction, operation, maintenance, repair or improvement of existing properties and assets;
(vi4) to acquire other or invest in Replacement Assets or acquire long-term assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Permitted Business;; or
(vii5) consummate any combination of the foregoing; or
provided that in the case of clauses (viii2), (3) enter and (4) above, (i) any such acquisition, expenditure or investment in accordance with such clause may be made by means of an acquisition, expenditure or investment by a Restricted Subsidiary in an amount equal to the Net Proceeds received by the Issuer or another Restricted Subsidiary, (ii) if the Issuer or any Restricted Subsidiary enters into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i)within such 365 day period, Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a such binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from such Asset Sale if an amount equal to such Net Proceeds is applied within 180 days of the end of the 365 day period (provided further that if such commitment is later terminated or canceled before such Net Proceeds are applied and the Issuer or any Restricted Subsidiary enters into another binding commitment (the “Second Commitment”) within 180 days of such cancellation or termination (or, if later, 365 days from the date receipt of such commitment until Net Proceeds), such Second Commitment shall be treated as a binding commitment; provided further that if any Second Commitment is later terminated or canceled before such Net Proceeds are applied, then such Net Proceeds shall constitute Excess Proceeds if not otherwise applied as provided above within 365 days of the earlier receipt of such Net Proceeds), (xiii) the date on which if assets subject to such Asset Sale constitute Collateral, any assets acquired or investment is consummated, described in clauses (2) and (y4) above shall be pledged as Collateral to secure the 180th day following Notes if and to the expiration of extent required by the aforementioned 360-day periodNotes Collateral Documents (and pursuant to the terms thereof) and (iv) if assets subject to such Asset Sale constitute Collateral, any such assets underlying any expenditure described in clause (3) above shall be pledged as Collateral to secure the Notes if and to the investment has not been consummated extent required by that datethe Notes Collateral Documents (and pursuant to the terms thereof).
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of the amount of any such Net Available CashProceeds, the Parent Issuer or any of its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings or otherwise utilize such apply the Net Available Cash Proceeds in any manner that is not prohibited by the terms of this Indenture. Holders of Notes may not have control of, or a perfected security interest in the Net Proceeds, which could diminish the value of the Collateral.
(d) On the 361st day (The amount of any Net Proceeds from Asset Sales that is not applied or the 541st day if a binding commitment invested as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if above will constitute “Excess Proceeds.” When the aggregate amount of Excess Proceeds exceeds $60 35.0 million, within 30 days thereof, unless waived or modified with the consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) Sale Offer to all Holders and, of Notes (with a copy to the extent the Issuer elects, to Trustee) and all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, pari passu with the Notes containing provisions similar to those set forth in this Indenture with respect to offers to purchase or redeem such Indebtedness with the proceeds of sales of assets to purchase the maximum principal amount of Notes and any such other Senior effectively pari passu Indebtedness that may be purchased out of the Excess Proceeds, at an . The offer price, price in respect of the Notes, any Asset Sale Offer will be equal to no less than 100% of the principal amount thereof being purchased, plus accrued and unpaid interestinterest thereon, if any, to, to but not includingexcluding, the date of purchase, and will be payable in cash. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer obligation with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) Proceeds from Asset Sales by making an Asset Sale Offer with respect to all or part a portion of the available Net Available Cash Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture (the “Advance Offer”). If any Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) remain after consummation of an Asset Sale Offer, the Issuer may use those Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) for any purpose not otherwise prohibited by the Indenture. If the aggregate principal amount of Notes and other pari passu Indebtedness tendered into such Asset Sale Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Trustee will select the Notes to be purchased on a pro rata basis (or, in the case of Notes in global form, by such other method as DTC may prescribe) and the Issuer will select such other pari passu Indebtedness to be purchased pursuant to the terms of such other pari passu Indebtedness; provided that as between the Notes and any such other pari passu Indebtedness, such purchases will be made on a on a pro rata basis based on the accreted value or principal amount of the Notes or such other pari passu Indebtedness (subject to adjustments to maintain the authorized denominations for the Notes). Upon completion of each Asset Sale Offer, the amount of Excess Proceeds will be reset at zero.
(ie) The Issuer will comply, to the extent applicable, comply in all material respects with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other securities laws or and regulations thereunder to the extent those laws and regulations are applicable in connection with the each repurchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any securities laws or regulations conflict with the Asset Sale provisions of this Section 4.05Indenture, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Asset Sale provisions of this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate make any Asset Disposition unless:
(i1) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary Subsidiary, as the case may be, receives for such Asset Disposition is consideration (both cash and non-cash) equal to not less than the fair market value of the assets disposed of as of Fair Market Value (such Fair Market Value to be determined on the date of entry into binding documentation in respect of contractually agreeing to such Asset Disposition (as determined by Disposition) of the Parent’s Board of Directors); andshares and assets subject to such Asset Disposition;
(ii2) at least 75% of the consideration from such Asset Disposition received by the Parent Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents or Replacement Assets. For purposes of this clause (2), each of the following shall be deemed to be cash:
(a) any liabilities (as shown on the face of the Company’s or such Restricted Subsidiary’s then most recent balance sheet), of the Company or any Restricted Subsidiary (other than contingent liabilities and Subordinated Obligations) that are assumed by the transferee of any such assets pursuant to a customary novation agreement that releases the Company or such Restricted Subsidiary receives in respect of such Asset Disposition consists of:from further liability; and
(Ab) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of Company or any such Restricted Subsidiary from such transferee that are contemporaneously (xsubject to ordinary settlement periods) any liabilities recorded on converted by the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
into cash (D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;cash received in that conversion); and
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant3) an offer amount equal to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application 100% of the Net Available Cash from such Asset Disposition:
(a) first, is applied by the Company or such Restricted Subsidiary, as the case may be,
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Bank Indebted-ness), to prepay, repay or purchase such Bank Indebtedness of the Company or of a Restricted Subsidiary within 365 days from the date of such commitment until the earlier of Asset Disposition (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of “Application Period”), unless to the extent such Net Available Cash not is otherwise used in accordance with clause (ii); provided, however, that, in connection with any prepayment, repayment or purchase of any such Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so used prepaid, repaid or purchased, or
(ii) to the extent the Company or such Restricted Subsidiary elects, to invest in Replacement Assets within the applicable Application Period; and
(b) second, to the extent of the balance of the Net Available Cash after application in accordance with (a) above, is applied by the Company or such Restricted Subsidiary, as the case may be, toward an offer to purchase Notes as set forth above constitutes “Excess Proceeds.” Pending in the next succeeding paragraph; provided, however, that pending the final application of any such Net Available CashCash in accordance with clause (a) or clause (b) above, the Parent or any Company and its Restricted Subsidiary Subsidiaries may temporarily reduce revolving credit borrowings Indebtedness or otherwise utilize invest such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
; provided, further, that clauses (d1) and (2) above shall not apply with respect to any Permitted Divestiture. On the 361st 366th day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, Disposition (or such earlier time date, if any, as the Issuer electsBoard of Directors of the Company or such Restricted Subsidiary determines that the Net Available Cash will not be applied in accordance with clause (3)(a) of the first paragraph of this Section 4.15), if the aggregate amount of Excess Proceeds exceeds $60 35.0 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders of Notes and, to the extent required by the Issuer electsterms of other Senior Indebtedness, to all or some holders of other outstanding Senior Indebtedness that is outstanding with similar provisions requiring the Company to make an offer to purchase such Senior Indebtedness with the proceeds from any Asset Disposition (“Pari Passu Indebtedness, Notes”) to purchase the maximum principal amount of Notes and any such other Senior Indebtedness Pari Passu Notes to which the Asset Disposition Offer applies that may be purchased out of the Excess Proceeds, at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof of the Notes and Pari Passu Notes plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect of Notes will be made , in accordance with the procedures set forth in this Indentureherein or the agreements governing the Pari Passu Notes, as applicable, in minimum denominations of $200,000 and each case in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, 1,000. To the amount of Excess Proceeds extent that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness Pari Passu Notes so validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Company may use any remaining Excess Proceeds for general corporate purposes, subject to other covenants contained in this Indenture. If the aggregate principal amount of Notes surrendered by Holders thereof and other Pari Passu Notes surrendered by holders or lenders of such Pari Passu Notes, collectively, exceeds the amount of Excess Proceeds, the Excess Proceeds Trustee shall be allocated among select the tendering Holders of Notes and such other Senior Indebtedness Pari Passu Notes to be purchased on a pro rata based basis on the basis of the aggregate principal amount of tendered Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodPari Passu Notes. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The . Each Asset Disposition Offer, insofar as it relates to the Notes, Offer will remain open for a period of not less than five (5) 20 Business Days following its commencement commencement, except to the extent that a longer period is required by applicable law (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer Company will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness and Pari Passu Notes required to be repaid or purchased by it pursuant to such offer this Section 4.15 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness Notes validly tendered in response to the Asset Disposition Offer.. Upon the commencement of an Asset Disposition Offer, the Company shall send, by first class mail, a notice to the Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Asset Disposition Offer. Any Asset Disposition Offer shall be made to all Holders. The notice, which shall govern the terms of the Asset Disposition Offer, shall state:
(h1) that the Asset Disposition Offer is being made pursuant to this Section 4.15;
(2) the Asset Disposition Offer Amount and the Asset Disposition Purchase Date;
(3) that any Notes not tendered or accepted for payment shall continue to accrete or accrue interest;
(4) that, unless the Company defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrete or accrue interest after the Asset Disposition Purchase Date;
(5) that Holders electing to have a Note purchased pursuant to the Asset Disposition Offer may only elect to have all of such Note purchased and may not elect to have only a portion of such Note purchased;
(6) that Holders electing to have a Note purchased pursuant to any Asset Disposition Offer shall be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Notes completed, or transfer by book-entry transfer, to the Company, a depository, if appointed by the Company, or the Paying Agent at the address specified in the notice at least three days before the Asset Disposition Purchase Date;
(7) that Holders shall be entitled to withdraw their election if the Company, the Depository or the Paying Agent, as the case may be, receives, not later than the second business day prior to the Asset Disposition Purchase Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;
(8) that, if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so that only Notes in denominations of $1,000, or integral multiples thereof, shall be purchased);
(9) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry transfer); and
(10) all other procedures, if any, determined by the Company, consistent with this Indenture, that a Holder must follow in order to have its Notes purchased in the Asset Disposition Offer. If the Asset Disposition Purchase Date is on or after an interest record date and on or before the related Interest Payment Date, any accrued and unpaid interest will be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest will be payable to Holders who tender Notes pursuant to the Asset Disposition Offer. On or before the Asset Disposition Purchase Date, the Company will, to the extent lawful, accept for payment, on a pro rata basis to the extent necessary, the Asset Disposition Offer Amount of Notes and Pari Passu Notes or portions of such Notes and Pari Passu Notes so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Notes so validly tendered and not properly withdrawn, in each case in integral multiples of $1,000. The Parent Company will deliver to the Trustee an Officers’ Certificate stating that such Notes or portions thereof were accepted for payment by the Company in accordance with the terms of this Section 4.15 and, in addition, the Company will deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or the Paying Agent, as the case may be, will promptly (but in any case not later than five Business Days after termination of the Asset Disposition Offer Period) mail or deliver to each tendering Holder of Notes or holder or lender of Pari Passu Notes, as the case may be, an amount equal to the purchase price of the Notes or Pari Passu Notes so validly tendered and not properly withdrawn by such holder or lender, as the case may be, and accepted by the Company for purchase, and the Company will promptly issue a new Note, and the Trustee, upon delivery of an Officers’ Certificate from the Company, will authenticate and mail or deliver such new Note to such Holder, in a principal amount equal to any unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount of $1,000 or an integral multiple of $1,000. In addition, the Company will take any and all other actions required by the agreements governing the Pari Passu Notes. Any Note not so accepted will be promptly mailed or delivered by the Company to the Holder thereof. The Company will publicly announce the results of the Asset Disposition Offer on or promptly following the Asset Disposition Purchase Date. In the event of the transfer of substantially all (but not all) of the property and assets of the Company and its Restricted Subsidiaries may satisfy as an entirety to a Person in a transaction permitted under Article 5, which transaction does not constitute a Change of Control, the foregoing obligations successor company shall be deemed to have sold the properties and assets of the Company and its Restricted Subsidiaries not so transferred for purposes of this Section 4.15, and shall comply with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer the provisions of this Section 4.15 with respect to such deemed sale as if it were an Asset Disposition. In addition, the Fair Market Value of such properties and assets of the Company or its Restricted Subsidiaries deemed to be sold shall be deemed to be Net Available Cash prior to the expiration for purposes of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) Section 4.15. The Issuer Company will comply, to the extent applicable, with the requirements of Section Rule 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection 4.15. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.054.15, the Issuer Company will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such complianceany conflict.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Davita Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Each of Superior Energy and Issuer will not, and will not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
(i1) the consideration the ParentSuperior Energy, the Issuer or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value (including as to the value of all non-cash consideration) as determined in good faith by the Board of Directors of Superior Energy, an Officer of Superior Energy, an Officer of Issuer or an Officer of such Restricted Subsidiary with responsibility for such transaction, which determination shall be conclusive evidence of compliance with this provision, of the shares and assets disposed subject to such Asset Disposition;
(2) in the case of as an Asset Disposition for consideration exceeding $40.0 million, the fair market value is determined, in good faith, by the Board of Directors of Superior Energy, and evidenced by a resolution of the date of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directors); andDirectors of Superior Energy set forth in an Officers’ Certificate delivered to the Trustee;
(ii3) either (a) at least 75% of the consideration the Parent thereof received by Superior Energy, Issuer or such Restricted Subsidiary receives Subsidiary, as the case may be, is in respect the form of cash or Temporary Cash Investments or (b) the fair market value (with the fair market value of each item of Designated Noncash Consideration being measured at the time received without giving effect to subsequent changes in value) of all forms of consideration other than cash or Temporary Cash Investments received for all Asset Dispositions since the Issue Date does not exceed in the aggregate an amount equal to 10% of Consolidated Tangible Assets at the time each determination is made; and
(4) an amount equal to 100% of the Net Available Cash from such Asset Disposition consists ofis applied by Superior Energy, Issuer or such Restricted Subsidiary, as the case may be, within 365 days after its receipt, at its option:
(A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition)to repay Secured Indebtedness under a Debt Facility;
(B) Cash Equivalents;to acquire Additional Assets or to make capital expenditures in a Related Business; and
(C) to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B), to make an offer to the Holders (and to holders of other Indebtedness of Issuer that is pari passu with the Notes) to purchase Notes (and such other Indebtedness of Issuer) pursuant to and subject to the conditions contained in this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A) or (C) above, Issuer or such Restricted Subsidiary shall permanently retire such Indebtedness and shall cause the related loan commitment, if any, to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Pending application of Net Available Cash pursuant to this Section 4.10, such Net Available Cash shall be invested in Temporary Cash Investments or used to reduce loans outstanding under any revolving credit facility existing under a Debt Facility. For the purposes of this Section 4.10, the following are deemed to be cash or Temporary Cash Investments: (i) the assumption by the purchaser of (x) Obligations of Superior Energy, Issuer or any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) Subsidiary (other than any of their Subordinated Indebtedness)Obligations) and the release of Superior Energy, Issuer or such Restricted Subsidiary, as a result of which none of the Parentcase may be, the Issuer or any of the other Restricted Subsidiaries remains obligated from all liability on such Obligations in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of connection with such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration securities received by the Parent Issuer or any Restricted Subsidiary from the transferee that are promptly converted by Issuer or such Restricted Subsidiary into cash within 180 days after the receipt thereof (to the extent of cash received) and (iii) any Designated Noncash Consideration received by Superior Energy, Issuer or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (iii) that is at any one that time outstanding, not to exceed the greater of 15(x) $30.0 million and (y) 1.5% of Consolidated EBITDA and $150 million Tangible Assets at the time of the receipt of such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
. The requirement of Section 4.10(a)(4) shall be deemed to be satisfied if an agreement (Hincluding a lease) any combination of committing to make the types of consideration acquisitions or expenditures referred to therein is entered into by Superior Energy, Issuer or a Restricted Subsidiary within the time period specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, is subsequently applied in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of agreement within six months following such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the agreement. Any Net Available Cash from Asset Dispositions that is not applied or invested as provided in Section 4.10(a)(4)(A) or (B) within the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount of such Net Available Cash not so used as time period set forth above constitutes therein will be deemed to constitute “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if When the aggregate amount of Excess Proceeds exceeds $60 30.0 million, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) Offer to all Holders and, to the extent required under the Issuer electsterms of outstanding pari passu Indebtedness of Issuer, to all or some the holders of other such outstanding Senior Indebtedness that is Pari Passu pari passu Indebtedness, to purchase the maximum aggregate principal amount of Notes and any such other Senior pari passu Indebtedness that may be purchased out of Issuer in an amount equal to $2,000 or an integral multiple of $1,000 in excess thereof at a purchase price of 100% of their principal amount (or, in the event such other pari passu Indebtedness of Issuer was issued with significant original issue discount, 100% of the Excess Proceedsaccreted value thereof), at an offer pricewithout premium, plus accrued but unpaid interest and Additional Interest (or, in respect of the Notessuch other pari passu Indebtedness of Issuer, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interestsuch lesser price, if any, to, as may be provided for by the terms of such Indebtedness of Issuer) to but not including, excluding the purchase date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in Section 3.09. Issuer may satisfy the foregoing obligations with respect to such Net Available Cash from an Asset Disposition by making an offer with respect to such Net Available Cash prior to the expiration of the application period. To the extent that the aggregate amount of Notes and such pari passu Indebtedness tendered pursuant to an Asset Disposition Offer is less than the Excess Proceeds, Issuer may use any remaining Excess Proceeds for general corporate purposes, subject to compliance with other covenants contained in this Indenture. If the aggregate principal amount of Notes or the pari passu Indebtedness surrendered by such holders thereof exceeds the amount of Excess Proceeds, in minimum denominations the Trustee or the applicable Registrar shall select the Notes and Issuer or agent for such pari passu Indebtedness shall select such pari passu Indebtedness to be purchased on a pro rata basis based on the principal amount (or accreted value) of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) the Notes or such pari passu Indebtedness tendered. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion . Each of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes Superior Energy and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to Section 3.09 hereof and this IndentureSection 4.10. To the extent that the provisions of any securities laws or regulations conflict with provisions of Section 3.09 hereof and this Section 4.054.10, the each of Superior Energy and Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under Section 3.09 hereof and this Indenture Section 4.10 by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (its compliance with such consentsecurities laws or regulations. Upon the occurrence of an Investment Grade Rating Event, for the avoidance of doubt, this Section 4.10 will cease to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole apply to Issuer and without regard to the level of consent obtained among Holders of each constituent series of Notes)will no longer have effect.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); and
the shares and assets subject to such Asset Disposition, (ii) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
(A) cash (including any Net Cash Proceeds received from cash, assets useful in a Permitted Business or Permitted Securities; PROVIDED that the conversion within 180 days amount of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary having an aggregate fair market valueSubsidiaries in such Asset Disposition shall be deemed cash for the purposes of this provision (but for no other purpose) so long as such amount, taken together with the Fair Market Value when received of all other Designated Non-Cash Noncash Consideration received pursuant to this covenant that is at any one that time outstandingoutstanding (I.E., that has not been sold for or otherwise converted into cash), does not exceed $25,000,000, and (iii) an amount equal to exceed the greater of 15100% of Consolidated EBITDA and $150 million the Net Available Cash from such Asset Disposition is applied by the Company (with or such Restricted Subsidiary, as the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(Hcase may be) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) of after the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash: (1) FIRST, to the Parent extent the Company elects (or its Restricted Subsidiaries may use is required by the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) terms of any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(aIndebtedness), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase purchase, repurchase, redeem, retire, defease or redeem such Pari Passu otherwise acquire for value Senior Indebtedness that constitutes Public Debt of the Company or Indebtedness (other than obligations in respect of Preferred Stock) of a Subsidiary Guarantor (in each case other than Indebtedness owed to the Company or an Affiliate of the Company and that has a Stated Maturity falling before other than obligations in respect of Disqualified Stock); (2) SECOND, to the Notes’ Stated Maturity only if extent of the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notesbalance of Net Available Cash after application, in accordance with clause (1), to the provisions set forth below for an Asset Disposition Offerextent the Company or such Restricted Subsidiary elects, to reinvest in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem Additional Assets (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness by means of an Investment in Additional Assets by a Restricted Subsidiary of with Net Available Cash received by the Parent that is not a Guarantor (other than the Issuer) Company or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any another Restricted Subsidiary);
; (ii3) purchase any series of Notes pursuant to an offer to all Holders of such series of NotesTHIRD, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders extent of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) The amount balance of such Net Available Cash not so used after application in accordance with clauses (1) and (2), to make an Offer (as set forth above constitutes “Excess Proceeds.” Pending defined in Section 4.06(b)) to purchase Securities pursuant to and subject to the final application conditions of Section 4.06(b); PROVIDED, HOWEVER, that if the Company elects (or is required by the terms of any Senior Subordinated Indebtedness), such Net Available CashOffer may be made ratably to purchase the Securities and other Senior Subordinated Indebtedness of the Company, and (4) FOURTH, to the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize extent of the balance of such Net Available Cash after application in accordance with clauses (1), (2) and (3), for any manner that is general corporate purpose not prohibited by the terms of this Indenture; PROVIDED, HOWEVER, that in connection with any prepayment, repayment, purchase, repurchase, redemption, retirement defeasance or other acquisition for value of Indebtedness pursuant to clause (1) or (3) above, the Company or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid, purchased, repurchased, redeemed, retired, defeased or otherwise acquired for value. Notwithstanding the foregoing provisions of this Section 4.06, the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section 4.06(a) except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 4.06(a) exceeds $10,000,000. For the purposes of this Section 4.06, the following are deemed to be cash: (A) the assumption of Indebtedness of the Company (other than obligations in respect of Disqualified Stock of the Company) or any Restricted Subsidiary (other than obligations in respect of Disqualified Stock and Preferred Stock of a Restricted Subsidiary that is a Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness in connection with such Asset Disposition and (B) securities received by the Company or any Restricted Subsidiary from the transferee that are promptly converted by the Company or such Restricted Subsidiary into cash.
(db) On In the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after event of an Asset Disposition, or such earlier time as Disposition that requires the Issuer elects, if the aggregate amount purchase of Excess Proceeds exceeds $60 millionSecurities (and other Senior Subordinated Indebtedness) pursuant to Section 4.06(a)(iii)(3), the Issuer will Company shall be required within twenty to purchase Securities (20and other Senior Subordinated Indebtedness) Business Days thereof tendered pursuant to make an offer by the Company for the Securities (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out Subordinated Indebtedness) (the "Offer") at a purchase price of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the their principal amount thereof plus accrued and unpaid interestinterest and liquidated damages thereon, if any, to, but not including, to the date of purchase. The Asset Disposition Offer in respect purchase (subject to the right of Notes will be made Holders of record on the relevant record date to receive interest due on the relevant interest payment date) in accordance with the procedures (including prorating in the event of oversubscription) set forth in Section 4.06(c). If the aggregate purchase price of Securities (and other Senior Subordinated Indebtedness) tendered pursuant to the Offer is less than the Net Available Cash allotted to the purchase of the Securities (and other Senior Subordinated Indebtedness), the Company shall apply the remaining Net Available Cash in accordance with Section 4.06(a)(iii)(4). The Company shall not be required to make an Offer for Securities (and other Senior Subordinated Indebtedness) pursuant to this IndentureSection 4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (1) and (2) of Section 4.06(a)(iii)) is less than $10,000,000 for any particular Asset Disposition (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(i) Promptly, and in any event within 10 days after the Company becomes obligated to make an Offer, the Company shall be obligated to deliver to the Trustee and send or, at the request of the Company have the Trustee send, in minimum denominations the name and on behalf of $200,000 and the Company, by first-class mail to each Holder, a written notice stating that the Holder may elect to have his Securities purchased by the Company either in whole or in part (subject to prorating as hereinafter described in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Company which the Company in excess thereofgood faith believes will enable such Holders to make an informed decision (which at a minimum shall include (1) the most recently filed Annual Report on Form 10-K (including audited consolidated financial statements) of the Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports); PROVIDED that in lieu of providing the reports specified in this clause (1), the Company may, at its option, notify the holders that such reports are available to them in electronic format through the SEC's ▇▇▇▇▇ system, (2) a description of material developments in the Company's business subsequent to the date of the latest of such reports, and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Securities pursuant to the Offer, together with the address referred to in clause (iii).
(eii) Upon completion Not later than the date upon which written notice of any such Asset Disposition Offeran Offer is delivered to the Trustee as provided above, the Company shall deliver to the Trustee an Officers' Certificate as to (1) the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless the "Offer Amount"), (2) the allocation of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining the Net Available Cash shall not be deemed Excess Proceeds and from the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn Asset Dispositions pursuant to which such Offer is being made and (3) the compliance of such allocation with the provisions of Section 4.06(a). On such date, the Company shall also 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) an Asset Disposition amount equal to the Offer exceeds Amount to be invested in Temporary Cash Investments and to be held for payment in accordance with the provisions of this Section. Upon the expiration of the period for which the Offer remains open (the "Offer Period"), the Company shall deliver to the Trustee for cancelation the Securities or portions thereof that have been properly tendered to and are to be accepted by the Company. The Trustee (or the Paying Agent, if not the Trustee) shall, on the date of purchase, mail or deliver payment to each tendering Holder in the amount of Excess Proceedsthe purchase price. In the event that the Offer Amount delivered by the Company to the Trustee is greater than the purchase price of the Securities (and other Senior Subordinated Indebtedness) tendered, the Excess Proceeds Trustee shall deliver the excess to the Company promptly after the expiration of the Offer Period for application in accordance with this Section 4.06.
(iii) Holders electing to have a Security purchased shall be allocated among required to surrender the tendering Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a facsimile transmission or letter setting forth the name of Notes the Holder, the principal amount of the Security which was delivered by the Holder for purchase and a statement that such other Senior Indebtedness pro rata based on Holder is withdrawing his election to have such Security purchased. If at the expiration of the Offer Period the aggregate principal amount of Notes Securities and such any other Senior Subordinated Indebtedness included in the Offer surrendered by holders thereof exceeds the Offer Amount, the Company shall select the Securities and other Senior Subordinated Indebtedness to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so tendered that only Securities and not properly withdrawnother Senior Subordinated Indebtedness in denominations of $1,000, or integral multiples thereof, shall be purchased). For the purposes of calculating the Holders whose Securities are purchased only in part will be issued new Securities equal in principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning unpurchased portion of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zeroSecurities surrendered.
(fiv) To At the extent that any portion of Net Available Cash payable in respect of time the Notes is denominated in a currency other than Company delivers Securities to the currency in Trustee which the relevant Notes are denominatedto be accepted for purchase, the amount thereof payable in respect of Company shall also deliver an Officers' Certificate stating that such Notes shall not exceed the net amount of funds in the currency in which such Notes Securities are denominated that is actually received to be accepted by the Issuer upon converting such portion Company pursuant to and in accordance with the terms of this Section. A Security shall be deemed to have been accepted for purchase at the Net Available Cash into such currencytime the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(gv) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes Securities pursuant to this IndentureSection. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Section, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Alliant Techsystems Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Issuer shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, directly or indirectly, consummate any Asset Disposition unless:
unless (ix) the consideration the Parent, the Issuer or such other Restricted Subsidiary receives for consideration at the time of such Asset Disposition at least equal to the fair market value (including as to the value of all non-cash consideration), as determined in good faith by the Board of Directors or an Officer of the Issuer, of the shares and/or assets subject to such Asset Disposition, (y) if the subject of the Asset Disposition consists of Aircraft, Airframes, Engines or Parts (each such term, as defined in the Aircraft Mortgage) and if any non-cash consideration is not subject to a Lien at the time of acquisition thereof, the fair market value of such non-cash consideration, plus the amount of any consideration in the form of cash or Cash Equivalents, less the amount of all obligations secured by such Lien, is greater than the fair market value of such Aircraft, Airframe, Engine and/or Part subject to the assets disposed of as Asset Disposition and (z) (A) at least eighty percent (80%) of the date consideration thereof received by the Issuer or such Restricted Subsidiary is in the form of entry into binding documentation cash or Cash Equivalents, or (B) if the subject of the Asset Disposition consists of Aircraft, Airframes, Engines or Parts, and if at least eighty percent (80%) of the consideration thereof received by the Issuer or such Restricted Subsidiary is not in respect the form of cash or Cash Equivalents, the Issuer or such Restricted Subsidiary has subjected to the Lien of the Aircraft Mortgage any aircraft, aircraft engines or other flight equipment acquired in exchange ("Exchanged Flight ---------------- Equipment") for the Aircraft, Airframe, Engine or Parts subject to such --------- Asset Disposition unless any lien or encumbrance existing on the Exchanged Flight Equipment at the time of acquisition thereof and to which the Issuer or such Restricted Subsidiary takes subject to prohibits the Issuer or such Restricted Subsidiary from subjecting the Exchanged Flight Equipment to the Lien of the Aircraft Mortgage. In the event the Issuer subjects to the Lien of the Aircraft Mortgage any Exchanged Flight Equipment, the Lien of the Aircraft Mortgage shall constitute a first priority security interest in such Exchanged Flight Equipment unless the Issuer acquires the Exchanged Flight Equipment subject to a prior lien, in which event, the Lien of the Aircraft Mortgage shall be junior only to such prior lien . If the Issuer or any Restricted Subsidiary engages in an Asset Disposition, the Issuer may use the Net Available Cash from such Asset Disposition, within one (1) year after the later of such Asset Disposition (as determined by and the Parent’s Board of Directors); and
(ii) at least 75% of the consideration the Parent or such Restricted Subsidiary receives in respect receipt of such Asset Disposition consists of:
Net Available Cash (A) cash (including any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’slater date, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness"Trigger Date"), as a result of which none of the Parent, the Issuer to (i) permanently ------------ repay or prepay any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of then outstanding Senior Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer Restricted Subsidiary or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) invest in or acquire (or enter into a legally binding commitment to invest in or acquire) Additional Assets; provided that the transaction subject to any such commitment be consummated -------- within one hundred eighty (180) days after the date of such commitment. If any such legally binding commitment to invest in or acquire such 61 Additional Assets is not Subordinated Indebtedness of terminated, then the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this covenant that is at any one time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (with the fair market value of each issue of Designated Non-Cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Dispositionmay, within 360 ninety (90) days (of such termination or the Trigger Date, whichever is later, use such period Net Available Cash as provided in clause (viii) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);
(iii) invest in any Replacement Assets;
(iv) acquire all or substantially all of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after without giving effect to any the parenthetical contained in such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
clause (vii)) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that date.
(c) above. The amount of such Net Available Cash Proceeds not so used as set forth above in this paragraph constitutes “"Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture." ---------------
(db) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if When the aggregate amount of Excess Proceeds exceeds $60 millionthe Asset Disposition Basket, the Issuer will be required shall, within twenty thirty (2030) Business Days thereof days thereof, apply all such Excess Proceeds
(1) first, to make an offer Offer to Purchase outstanding Notes at one hundred percent (“Asset Disposition Offer”100%) of their principal amount plus accrued and unpaid interest and Special Interest, if any, thereon to all Holders the Purchase Date and, to the extent required by the terms thereof, any other Indebtedness of the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase pari passu with the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to a price no less greater than one hundred percent (100% %) of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, interest to the date of purchase. The Asset Disposition Offer in respect purchase and (2) second, to the extent of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereof.
(e) Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration following the completion of the Offer to Purchase, to any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may other use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected determined by the Issuer that which is within not otherwise prohibited by the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer PeriodIndenture. Upon the completion of any Asset Disposition Offeran Offer to Purchase pursuant to this paragraph (b), the amount of Excess Proceeds shall be reset at to zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05, the Issuer will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Indenture by virtue of such compliance.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Airtran Holdings Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Issuer shall not, and will shall not permit any of the Issuer or any other Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Disposition, unless:
(i1) the consideration the Parent, the Issuer or such other Restricted Subsidiary Subsidiary, as the case may be, receives for consideration at the time of such Asset Disposition is not less than at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of (measured as of the date of entry into binding documentation in the definitive agreement with respect of to such Asset Disposition (as determined by the Parent’s Board of DirectorsDisposition); and
(ii2) at least 75% of the consideration therefor received by the Parent Issuer or such Restricted Subsidiary receives in respect Subsidiary, as the case may be (which, for purposes of this clause (2), consideration will not include any contingent payment obligations related to such Asset Disposition consists Disposition, including, earn-out payments, purchase price adjustments and deferred purchase price payments), is in the form of cash or Cash Equivalents; provided that the amount of:
(A) cash any liabilities, as shown on the Issuer’s or such Restricted Subsidiary’s most recent balance sheet or in the notes thereto, of the Issuer or any of its Restricted Subsidiaries (including other than contingent liabilities and liabilities that are by their terms subordinated to the Notes) (i) that are assumed by the transferee of any Net Cash Proceeds received from such assets, or (ii) in respect of which neither the conversion within 180 days of Issuer nor any Restricted Subsidiary following such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition)has any obligation;
(B) Cash Equivalents;
(C) the assumption any securities or other obligations received by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any such Restricted Subsidiary from such transferee that are converted by the Issuer or such Restricted Subsidiary into cash or Cash Equivalents (to the extent of the other Restricted Subsidiaries remains obligated in respect of such liabilities, cash or (yCash Equivalents received) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if within 180 days following the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result closing of such Asset Disposition;
(D) Replacement Assets;
(EC) any Capital Stock Stock, properties or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b4.11(b)(2);
(FD) consideration consisting cash held in escrow as security for any purchase price settlement, for damages in respect of Indebtedness a breach of representations and warranties or covenants or for payment of other contingent obligations in connection with such Asset Disposition; and
(E) any Designated Noncash Consideration received by the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G) any Designated Non-Cash Consideration received by the Parent or any Restricted Subsidiary in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (E) that is at any one that time outstanding, not to exceed the greater of 15(x) $20.0 million and (y) 2.0% of Consolidated EBITDA and $150 million (the Total Assets of the Issuer at the time of the receipt of such Designated Noncash Consideration, with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination , in each case, shall be deemed to be Cash Equivalents for purposes of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G)this provision and for no other purpose.
(b) If Within 365 days after the Parentreceipt of any Net Cash Proceeds of any Asset Disposition, the Issuer or any other such Restricted Subsidiary consummates an Asset DispositionSubsidiary, within 360 days (or such period as provided in clause (viii) belowat its option, if applicable) of may apply the later of the date of consummation of Net Cash Proceeds from such Asset Disposition to one or more of the following, or any combination,
(1) to reduce or repay:
(A) Indebtedness under the Credit Facility and receipt (i) permanently repay any term loans thereunder or (ii) reduce the revolving commitments, if any, thereunder; or
(B) to the extent the property that is subject to such Asset Disposition was sold by a non-Guarantor Subsidiary, Indebtedness of a non-Guarantor Subsidiary, other than Indebtedness owed to the Issuer or another Restricted Subsidiary; or
(2) to make (A) an Investment in any one or more businesses; provided that such Net Available Cash, Investment in any business is in the Parent form of the acquisition of Capital Stock of a Restricted Subsidiary or results in the Issuer or its Restricted Subsidiaries may use owning an amount of the Net Available Cash to:
Capital Stock of such business such that it constitutes a Restricted Subsidiary, (iB) (a) prepaycapital expenditures in respect of the Issuer, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall or their respective assets or (C) acquisitions of other properties or assets to be entitled held by the Issuer or its Restricted Subsidiaries (including assets that replace the business, properties and assets of the Issuer or any of its Restricted Subsidiaries that were the subject of such Asset Disposition), in the case of each of (A), (B) and (C), used or useful in a Related Business;
(3) to prepay, repay, purchase reduce or redeem such repay Pari Passu Indebtedness Payment Lien Obligations, provided, that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent Issuer or any Restricted Subsidiary shall so reduce Pari Passu Payment Lien Obligations, the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, shall equally and ratably reduce Obligations under the Notes in accordance with the provisions set forth under Section 3.07, through open market purchases of the Notes or through an offer to purchase Notes (in accordance with the procedures set forth below for an Asset Disposition Offer); provided, in that all Net Cash Proceeds used to make such an amount as would offer to purchase shall be deemed to have been so applied whether or not accepted by the Holders; or
(4) to reduce or repay Obligations under the aggregate principal amount of Notes then outstanding in accordance with the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepaymentsprovision set forth under Section 3.07, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary purchases of the Parent that is not a Guarantor (other than the Issuer) Notes or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase any series of Notes pursuant to through an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the purchase Notes (in accordance with the procedures set out belowforth below for an Asset Disposition Offer);
(iii) invest in any Replacement Assets;
(iv) acquire ; provided, that all Net Cash Proceeds used to make such an offer to purchase shall be deemed to have been so applied whether or substantially all of not accepted by the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other than Capital Stock and cash or Cash Equivalents) Holders; provided that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Proceeds as set forth in Section 4.05(b)(i), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v4.11(b)(2) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Issuer or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 180 days of the end of such 365-day period (xan “Acceptable Commitment”) and, in the date on which event any Acceptable Commitment is later cancelled or terminated for any reason before the Net Cash Proceeds are applied in connection therewith, then the Issuer or such investment is consummated, and (y) Restricted Subsidiary shall be permitted to apply the 180th day following Net Cash Proceeds in any manner set forth above before the expiration of the aforementioned 360such 180-day periodperiod and, if in the investment has not been consummated by that dateevent the Issuer or such Restricted Subsidiary fails to do so, then such Net Cash Proceeds shall constitute Excess Proceeds (as defined below).
(c) The amount of such Any Net Available Cash Proceeds from an Asset Disposition that are not so used invested or applied as provided and within the time period set forth above constitutes in Section 4.11(b) will be deemed to constitute “Excess Proceeds.” Pending the final application of any such Net Available Cash, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the ”. The Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof to shall make an offer to all Holders of the Notes (an “Asset Disposition Offer”) to and all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu IndebtednessPayment Lien Obligations containing provisions similar to those set forth in this Indenture with respect to offers to purchase, prepay or redeem with the proceeds of sales of assets to purchase purchase, prepay or redeem the maximum aggregate principal amount of the Notes (equal to $2,000 or integral multiples of $1,000 in excess thereof) and any such other Senior Pari Passu Payment Lien Obligations (plus all accrued interest on such Indebtedness and the amount of all fees and expenses, including premiums, incurred in connection therewith), that may be purchased out of the Excess Proceeds, Proceeds at an offer price, price in respect of the Notes, cash in an amount equal to no less than 100% of the principal amount thereof (or, in the event such Pari Passu Payment Lien Obligations were issued with original issue discount, 100% of the accreted value thereof), plus accrued and unpaid interest, if any, interest to, but not including, the date fixed for the closing of purchase. The Asset Disposition Offer in respect such offer (subject to the rights of Notes will be made Holders on the relevant record date to receive interest due on the relevant interest payment date), in accordance with the procedures set forth in this IndentureIndenture or the agreements governing such Pari Passu Payment Lien Obligations, in minimum denominations as applicable. The Issuer shall commence an Asset Disposition Offer with respect to Excess Proceeds within 30 days after the date that Excess Proceeds exceed $30.0 million by delivering the notice required pursuant to Section 3.10, with a copy to the Trustee. The Issuer may, at its election, satisfy the foregoing obligations with respect to any Net Cash Proceeds from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Cash Proceeds prior to the expiration of $200,000 and in integral multiples of $1,000 in excess thereofthe relevant 365-day period (or such longer period provided above).
(ed) To the extent that the aggregate amount of Notes and Pari Passu Payment Lien Obligations tendered pursuant to an Asset Disposition Offer is less than the Excess Proceeds, the Issuer may use any remaining Excess Proceeds for any purpose not prohibited by this Indenture. If the aggregate principal amount of Notes and Pari Passu Payment Lien Obligations surrendered by such holders thereof exceeds the amount of Excess Proceeds, the Trustee shall select the Notes and the applicable agent or the Issuer shall select such Pari Passu Payment Lien Obligations to be purchased on a pro rata basis, in accordance with the applicable procedures of the Depositary, based on the accreted value or principal amount of the Notes tendered (with adjustments as necessary so that no Notes will be repurchased in part in an unauthorized denomination) or such Pari Passu Payment Lien Obligations tendered. Upon completion of any such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement to make an Asset Disposition Offer shall be reset to zero zero.
(regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration e) Pending the final application of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Issuer (or the applicable Restricted Subsidiary) may temporarily reduce revolving credit borrowings or otherwise invest the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of in any such Indebtedness tendered in an Asset Disposition Offer manner that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so prohibited by this Indenture.
(if) The Issuer will comply, to the extent applicable, shall comply with the requirements of Section 14(e) of Rule 14e-l under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws or regulations are applicable in connection with the repurchase of the Notes pursuant to this Indenturean Asset Disposition Offer. To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.05Indenture, the Issuer will shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under described in this Indenture by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the time of such Asset Disposition is not less than at least equal to the fair market value of the assets disposed of as of the date of entry into binding documentation in respect of such Asset Disposition (as determined in good faith by the Parent’s Board Company) of Directors); and
the shares and assets subject to such Asset Disposition, (ii) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of cash or cash equivalents (provided that the amount of (w) any liabilities (as shown on the Company's or such Asset Disposition consists of:
Restricted Subsidiary's most recent balance sheet or in the notes thereto) of the Company or any Restricted Subsidiary (Aother than liabilities that are by their terms subordinated to the Notes) cash that are assumed by the transferee of any such assets without recourse to the Company or any of the Restricted Subsidiaries, (including x) any Net Cash Proceeds received from the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) any liabilities recorded on the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the notes thereto (or, if Incurred since the date extent of the latest balance sheet, that would be recorded on cash received) within 180 days following the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result closing of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(Gy) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (y) and Section 4.06(a)(ii)(y) of the 1998 Notes Indenture that is at any one that time outstanding, not to exceed the greater of 155% of Adjusted Consolidated EBITDA and $150 million Assets at the time of the receipt of such Designated Noncash Consideration (with the fair market value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value); orbeing
(Ha) any combination except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 4.06 (a) exceeds $20.0 million (provided that such amount shall be reduced by the aggregate Net Available Cash from all Asset Dispositions not applied in accordance with Section 4.06(a) of the types of consideration specified in 1998 Notes Indenture prior to the preceding clauses (ii)(A) through (ii)(GClosing Date).
(b) If In the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days (or such period as provided in clause (viii) below, if applicable) event of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce that requires the aggregate principal amount purchase of Notes then outstanding in the same proportion as the aggregate principal amount of such (and other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Senior Subordinated Indebtedness of the Issuer or a Guarantor or Company) pursuant to Section 4.06(a)(iii)(C), the Company shall be required to purchase Notes (and other Senior Subordinated Indebtedness owed to of the Parent or any Restricted Subsidiary);
(iiCompany) purchase any series of Notes tendered pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to by the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of Company for the Notes (and other Senior Subordinated Indebtedness of the Company) (the "Offer") at a purchase price of 100% of their principal amount plus accrued and unpaid interest and liquidated damages, if any, to the date of purchase in accordance with the procedures (including prorating in the event of oversubscription), set out belowforth in Section 4.06(c);
. If the aggregate purchase price of Notes (iii) invest in any Replacement Assets;
(iv) acquire all or substantially all and other Senior Subordinated Indebtedness of the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect Company) tendered pursuant to any such acquisition of Capital Stock, such Person the Offer is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other less than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash allotted to the purchase of the Notes (and other Senior Subordinated Indebtedness of the Company), the Company may apply the remaining Net Available Cash for any purpose permitted by the terms of this Indenture. The Company shall not be required to make an Offer for Notes (and other Senior Subordinated Indebtedness of the Company) pursuant to this Section 4.05(b)(i4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (A) and (B) of Section 4.06(a)(iii)) is less than $10.0 million for any particular Asset Disposition (which lesser amount shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from any subsequent Asset Disposition).
(1) Promptly, and in any event within 30 days after the Company becomes obligated to make an Offer, the Company shall be obligated to deliver to the Trustee and send, by first-class mail to each Noteholder, a written notice stating that the Noteholder may elect to have his Notes purchased by the Company either in whole or in part (subject to prorating as hereinafter described in the event the Offer is oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain or incorporate by reference such information concerning the business of the Company which the Company in good faith believes will enable such Noteholders to make an informed decision and all instructions and materials necessary to tender Notes pursuant to the Offer, together with the address referred to in clause (3).
(2) Not later than the date upon which written notice of an Offer is delivered to the Trustee as provided above, the Company shall deliver to the Trustee an Officers' Certificate as to (i) the amount of the Offer (the "Offer Amount"), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v(ii) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment shall be treated as a permitted application the allocation of the Net Available Cash from the date Asset Dispositions pursuant to which such Offer is being made and (iii) the compliance of such commitment until allocation with the earlier provisions of Section 4.06(a). On such date, the Company shall also irrevocably deposit with the Trustee or with a paying agent (xor, if the Company is acting as its own paying agent, segregate and hold in trust) an amount equal to the date on which such investment is consummated, Offer Amount to be invested in Temporary Cash Investments and (y) to be held for payment in accordance with the 180th day following provisions of this Section. Upon the expiration of the aforementioned 360-day period, if period for which the investment has not been consummated by that date.
Offer remains open (c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash"Offer Period"), the Parent Company shall deliver to the Trustee for cancelation the Notes or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner portions thereof that is not prohibited have been properly tendered to and are to be accepted by the terms of this Indenture.
(d) On the 361st day Company. The Trustee (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer electsPaying Agent, if not the aggregate amount of Excess Proceeds exceeds $60 millionTrustee) shall, the Issuer will be required within twenty (20) Business Days thereof to make an offer (“Asset Disposition Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, on the date of purchase, mail or deliver payment to each tendering Noteholder in the amount of the purchase price. The Asset Disposition In the event that the aggregate purchase price of the Notes (and other Senior Subordinated Indebtedness of the Company) delivered by the Company to the Trustee is less than the Offer in respect Amount applicable to the Notes (and other Senior Subordinated Indebtedness of Notes will be made the Company), the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and in integral multiples of $1,000 in excess thereofSection 4.06.
(e3) Upon completion Noteholders electing to have a Note purchased shall be required to surrender the Note, with an appropriate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Noteholders shall be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a telegram, telex, facsimile transmission or letter setting forth the name of any such Asset Disposition Offerthe Noteholder, the principal amount of Excess Proceeds the Note which was delivered by the Noteholder for purchase and a statement that resulted in such Noteholder is withdrawing his election to have such Note purchased. If at the requirement to make an Asset Disposition Offer shall be reset to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on Period the aggregate principal amount of Notes and such any other Senior Subordinated Indebtedness of the Company included in the Offer surrendered by holders thereof exceeds the Offer Amount, the Company shall select the Notes and other Senior Subordinated Indebtedness of the Company to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Company so tendered that only Notes and not properly withdrawnother Senior Subordinated Indebtedness of the Company in denominations of $1,000, or integral multiples thereof, shall be purchased). For the purposes of calculating the Noteholders whose Notes are purchased only in part will be issued new Notes equal in principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning unpurchased portion of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zeroNotes surrendered.
(f4) To At the extent that any portion of Net Available Cash payable in respect of time the Company delivers Notes is denominated in a currency other than to the currency in Trustee which the relevant Notes are denominatedto be accepted for purchase, the amount thereof payable in respect of such Notes Company shall not exceed the net amount of funds in the currency in which also deliver an Officers' Certificate stating that such Notes are denominated that is actually received to be accepted by the Issuer upon converting such portion Company pursuant to and in accordance with the terms of this Section. A Note shall be deemed to have been accepted for purchase at the Net Available Cash into such currencytime the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Noteholder.
(gd) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will Company shall comply, to the extent applicable, with the requirements of Section 14(e) of the Exchange Act and any other securities laws or regulations in connection with the repurchase of Notes pursuant to this IndentureSection. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Section, the Issuer will Company shall comply with the applicable securities laws and regulations and will shall not be deemed to have breached its obligations under this Indenture Section by virtue of such compliancethereof.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
Appears in 1 contract
Sources: Indenture (Wesco International Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent will Company shall not, and will shall not permit the Issuer or any other Restricted Subsidiary to, consummate make any Asset Disposition unless:
unless (i) the consideration the Parent, the Issuer Company or such other Restricted Subsidiary receives for such Asset Disposition is not less than consideration (including by way of relief from, or by any other Person assuming sole responsibility for, any liabilities, contingent or otherwise) at the fair market value of the assets disposed of as of the date of entry into binding documentation in respect time of such Asset Disposition (as determined by at least equal to the Parent’s Board Fair Market Value of Directors); and
the shares and assets subject to such Asset Disposition, (ii) at least 75% of the consideration thereof received by the Parent Company or such Restricted Subsidiary receives is in respect the form of such Asset Disposition consists of:
(A) cash (including any Net or Temporary Cash Proceeds received from Investments; provided that the conversion within 180 days of such Asset Disposition of securities, notes or other obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser amount of (x1) any liabilities recorded (as shown on the Parent’s, the Issuer’s Company's or such other Restricted Subsidiary’s 's most recent balance sheet or in the notes thereto (or, if Incurred since the date thereto) of the latest balance sheet, that would be recorded on the next balance sheet) Company or any Restricted Subsidiary (other than Subordinated Indebtednessliabilities that are by their terms subordinated to the Notes), as a result that are assumed by the transferee of which none of any such assets (provided that the Parent, the Issuer Company or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, if the Parent, the Issuer and every other Restricted Subsidiary is released from all liability with respect thereto), (2) any guarantee securities received by the Company or such Restricted Subsidiary from such transferee that are converted by the Company or such Restricted Subsidiary into cash (to the extent of such Indebtedness as a result the cash received) within 90 days following the closing of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, Disposition and (ii) is not Subordinated Indebtedness of the Issuer or such Guarantor;
(G3) any Designated Non-Cash Noncash Consideration received by the Parent Company or any of its Restricted Subsidiary Subsidiaries in such Asset Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this covenant clause (3) that is at any one that time outstanding, not to exceed the greater of 15(A) $25.0 million or (B) 3% of Consolidated EBITDA and $150 million Total Assets at time of receipt of such Designated Noncash Consideration (with the fair market value Fair Market Value of each issue item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value), shall be deemed to be cash for purposes of this provision and for no other purpose; or
and (Hiii) any combination an amount equal to 100% of the types of consideration specified in Net Available Cash from such Asset Disposition is applied by the preceding clauses (ii)(A) through (ii)(G).
(b) If the Parent, the Issuer or any other Restricted Subsidiary consummates an Asset Disposition, within 360 days Company (or such period Restricted Subsidiary, as provided in clause the case may be) (viii1) belowfirst, if applicable(A) to the extent the Company elects (or is required by the terms of any Indebtedness), to prepay, repay, redeem or purchase Senior Indebtedness of the Company or Indebtedness (other than any Disqualified Stock) of a Restricted Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Company and other than Preferred Stock) or (B) to the extent the Company or such Restricted Subsidiary elects, to acquire Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the Company or another Restricted Subsidiary), in the case of each of clauses (A) and (B), within one year after the later of the date of consummation of such Asset Disposition and or the receipt of such Net Available Cash; (2) second, to the Parent or its Restricted Subsidiaries may use extent of the balance of such Net Available Cash to:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, after application in accordance with clause (1), to make an Offer to purchase the provisions set forth below for an Asset Disposition OfferNotes pursuant to and subject to the conditions of Section 4.06(b); provided, in however, that if the Company elects (or is required by the terms of any Senior Subordinated Indebtedness), such an amount as would reduce Offer may be made ratably to purchase the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such and other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Senior Subordinated Indebtedness of the Issuer or a Guarantor or Indebtedness owed Company; and (3) third, to the Parent extent of the balance of such Net Available Cash after application in accordance with clauses (1) and (2), for any general corporate purpose permitted pursuant to the terms of this Indenture; provided, however that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (1) (A) or (2) above, the Company or such Restricted Subsidiary shall retire such Indebtedness and shall cause the related loan commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased. Notwithstanding the foregoing provisions of this Section 4.06, the Company and the Restricted Subsidiaries shall not be required to apply any Restricted Subsidiary);Net Available Cash in accordance with this Section 4.06(a) except to the extent that the aggregate Net Available Cash from all Asset Dispositions that is not applied in accordance with this Section 4.06 (a) exceeds $5.0 million.
(iib) In the event of an Asset Disposition that requires the purchase any series of Notes (and other Senior Subordinated Indebtedness) pursuant to Section 4.06(a)(iii)(2), the Company shall be required to purchase Notes (and other Senior Subordinated Indebtedness) tendered pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to by the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of Company for the Notes (and other Senior Subordinated Indebtedness) (the "Offer") at a purchase price of 100% of their principal amount plus accrued and unpaid interest and liquidated damages, if any, to the date of purchase (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date) in accordance with the procedures (including prorating in the event of oversubscription) set out belowforth in Section 4.06(c);
. If the aggregate purchase price of Notes (iiiand other Senior Subordinated Indebtedness) invest in any Replacement Assets;
(iv) acquire all or substantially all of tendered pursuant to the assets of, or any Capital Stock of, another Person engaged in a Similar Business, if, after giving effect to any such acquisition of Capital Stock, such Person Offer is or becomes a Restricted Subsidiary;
(v) make a capital expenditure;
(vi) acquire other assets (other less than Capital Stock and cash or Cash Equivalents) that are used or useful in a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash allotted to the purchase of the Notes (and other Senior Subordinated Indebtedness), the Company may apply the remaining Net Available Cash for any general corporate purpose permitted pursuant to the terms of this Indenture. The Company shall not be required to make an Offer for Notes (and other Senior Subordinated Indebtedness) pursuant to this Section 4.05(b)(i4.06 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 4.06(a)(iii)(1), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided that, a binding commitment is less than $10.0 million for any particular Asset Disposition (which lesser amount shall be treated as a permitted application carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from the date of such commitment until the earlier of (x) the date on which such investment is consummated, and (y) the 180th day following the expiration of the aforementioned 360-day period, if the investment has not been consummated by that dateany subsequent Asset Disposition).
(c) The amount of such Net Available Cash not so used as set forth above constitutes “Excess Proceeds.” Pending the final application of any such Net Available Cash(i) Promptly, the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash and in any manner that is not prohibited by event within 10 days after the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer will be required within twenty (20) Business Days thereof Company becomes obligated to make an offer (“Asset Disposition Offer”) , the Company shall be obligated to all Holders and, deliver to the extent Trustee and send, by first-class mail to each Holder, a written notice stating that the Issuer elects, Holder may elect to all have his Notes purchased by the Company either in whole or some holders of other outstanding Senior Indebtedness that in part (subject to prorating as hereinafter described in the event the Offer is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds, at an offer price, in respect of the Notes, equal to no less than 100% of the principal amount thereof plus accrued and unpaid interest, if any, to, but not including, the date of purchase. The Asset Disposition Offer in respect of Notes will be made in accordance with the procedures set forth in this Indenture, in minimum denominations of $200,000 and oversubscribed) in integral multiples of $1,000 of principal amount, at the applicable purchase price. The notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of such notice (the "Purchase Date") and shall contain such information concerning the business of the Company which the Company in excess thereof.
(e) Upon completion of any good faith believes will enable such Asset Disposition Offer, the amount of Excess Proceeds that resulted in the requirement Holders to make an Asset Disposition Offer informed decision (which at a minimum shall be reset to zero include (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and 1) the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Offer exceeds the amount of Excess Proceeds, the Excess Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based most recently filed Annual Report on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five Form 10-K (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer will comply, to the extent applicable, with the requirements of Section 14(eincluding audited consolidated financial statements) of the Exchange Act Company, the most recent subsequently filed Quarterly Report on Form 10-Q and any Current Report on Form 8-K of the Company filed subsequent to such Quarterly Report, other securities laws than Current Reports describing Asset Dispositions otherwise described in the offering materials (or regulations corresponding successor reports), (2) a description of material developments in connection with the repurchase Company's business subsequent to the date of the latest of such reports, and (3) if material, appropriate pro forma financial information) and all instructions and materials necessary to tender Notes pursuant to this Indenture. To the extent that the provisions of any securities laws or regulations conflict with provisions of this Section 4.05Offer, the Issuer will comply together with the applicable securities laws and regulations and will not be deemed address referred to have breached its obligations under this Indenture by virtue of such compliance.
in clause (j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notesiii).
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Parent Company will not, and will not permit the Issuer or any other of its Restricted Subsidiary Subsidiaries to, consummate any an Asset Disposition Sale unless:
(i1) the Company or the applicable Restricted Subsidiary, as the case may be, receives consideration at the Parent, time of the Issuer or such other Restricted Subsidiary receives for such Asset Disposition is not less than Sale at least equal to the fair market value Fair Market Value of the assets sold or otherwise disposed of as determined in good faith by the Board of Directors of the date Company (including the value of entry into binding documentation in respect of such Asset Disposition (as determined by the Parent’s Board of Directorsall non-cash consideration); and
(ii2) at least 75% of the consideration received for the Parent assets sold by the Company or the Restricted Subsidiary, as the case may be, in the Asset Sale will be in the form of cash, Cash Equivalents or assets or Capital Stock which the Company or a Permitted Investing Subsidiary would be permitted to use the Net Cash Proceeds from such Restricted Subsidiary receives in respect Asset Sale to purchase or invest in, if any, pursuant to clause (2) of Section 3.12(b). For the purposes of this clause (2), the following are deemed to be cash:
(i) Indebtedness and other liabilities shown on the most recent consolidated balance sheet of the Company prior to the date of such Asset Disposition consists of:
Sale (Aother than Subordinated Indebtedness) cash (including i) that are assumed by the transferee of any Net Cash Proceeds received such assets and (ii) for which the Company and its Restricted Subsidiaries are released from all liability at the conversion within 180 days time of such Asset Disposition of Sale;
(ii) any securities, notes or other obligations Obligations received in consideration of such Asset Disposition);
(B) Cash Equivalents;
(C) the assumption by the purchaser of (x) Company or any liabilities recorded on such Restricted Subsidiary from such transferee that are converted, sold or exchanged by the Parent’s, the Issuer’s Company or such other Restricted Subsidiary’s balance sheet or the notes thereto (or, if Incurred since the date of the latest balance sheet, that would be recorded on the next balance sheet) (other than Subordinated Indebtedness), as a result of which none of the Parent, the Issuer or any of the other Restricted Subsidiaries remains obligated in respect of such liabilities, or (y) Indebtedness of a Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositioninto cash or Cash Equivalents within 90 days, if the Parent, the Issuer and every other Restricted Subsidiary is released from any guarantee of such Indebtedness as a result of such Asset Disposition;
(D) Replacement Assets;
(E) any Capital Stock or assets of the kind referred to in clause (iv) or (vi) of Section 4.05(b);
(F) consideration consisting of Indebtedness of the Issuer or any Guarantor received from Persons who are not the Parent, the Issuer or any other Restricted Subsidiary, but only to the extent that such Indebtedness (i) has been extinguished by the Issuer or the applicable Guarantor, and (ii) is not Subordinated Indebtedness of the Issuer cash or such Guarantor;Cash Equivalents received in that conversion, sale or exchange; and
(Giii) any Designated Non-Cash cash Consideration received by the Parent Company or any such Restricted Subsidiary in such Asset Sale having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this covenant clause (iii) that is at any one that time outstanding, not to exceed the greater of 15% of Consolidated EBITDA and $150 million (5.0 million, with the fair market value Fair Market Value of each issue item of Designated Non-Cash cash Consideration being measured at the time received and without giving effect to subsequent changes in value); or
(H) any combination of the types of consideration specified in the preceding clauses (ii)(A) through (ii)(G).
(b) If The Company or a Restricted Subsidiary, as the Parentcase may be, may (subject to the Issuer or proviso in clause (2) below) apply the Net Cash Proceeds of any other Restricted Subsidiary consummates an such Asset Disposition, Sale within 360 days thereof to:
(1) prepay, repay, purchase, repurchase, redeem, retire, defease or such period as provided in clause otherwise retire for value (viiicollectively, “repay”) below, if applicable) of the later of the date of consummation of such Asset Disposition and receipt of such Net Available Cash, the Parent or its Restricted Subsidiaries may use the Net Available Cash toany:
(i) (a) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Senior Indebtedness Incurred under Section 4.01(b)(i); (b) unless included in the preceding clause (i)(a), prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Pari Passu Indebtedness; provided that the Parent, and its Restricted Subsidiaries shall be entitled to prepay, repay, purchase or redeem such Pari Passu Indebtedness that constitutes Public Debt and that has a Stated Maturity falling before the Notes’ Stated Maturity only if the Parent or the Issuer makes (at such time or in compliance with this covenant) an offer to Holders to purchase Notes, in accordance with the provisions set forth below for an Asset Disposition Offer, in such an amount as would reduce the aggregate principal amount of Notes then outstanding in the same proportion as the aggregate principal amount of such other Pari Passu Indebtedness would be reduced by such prepayments, repayments, purchases or redemptions; or (c) prepay, repay, purchase or redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any Indebtedness of a Restricted Subsidiary of the Parent that is not a Guarantor (other than the Issuer) or any Indebtedness that is secured on assets that do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Issuer Company or a Guarantor or Indebtedness owed to the Parent or any Restricted Subsidiary);
(ii) purchase Indebtedness of any series of Notes pursuant to an offer to all Holders of such series of Notes, redeem (including through open market purchases, voluntary tender offers or privately negotiated transactions at market prices) any series of Notes pursuant to the redemption provisions of this Indenture or by making an Asset Disposition Offer to all Holders of the Notes (in accordance with the procedures set out below);Restricted Subsidiary that is not a Note Guarantor; or
(iii) any Senior Indebtedness, provided that, if the Company repays any Senior Indebtedness other than the Notes, it must repay Notes or make an offer to repurchase the Notes at a price equal to or above 100% of the principal amount thereof, whether or not the Holders accept such offer, in each case on a pro rata basis with such other Senior Indebtedness; in the case of each of clauses (i) through (iii) above, constituting Indebtedness for borrowed money or Capitalized Lease Obligations, and permanently reduce the commitments with respect thereto without Refinancing; or
(2) purchase or otherwise invest in:
(i) assets (other than current assets as determined in any Replacement Assetsaccordance with GAAP or Capital Stock) to be used by the Company or a Permitted Investing Subsidiary in a Permitted Business or capital expenditures;
(ivii) acquire all or substantially all of the assets of, of a Permitted Business or any properties; or
(iii) Capital Stock of, another : (A) a Restricted Subsidiary held by a Person other than the Company or any of its Restricted Subsidiaries or (B) a Person engaged in a Similar BusinessPermitted Business that becomes, ifupon the purchase or investment, after giving effect to any such acquisition a Wholly Owned Subsidiary or, in the case of an Asset Sale in respect of assets or Capital Stock, such Person is or becomes Stock of a Restricted Subsidiary;
, a Restricted Subsidiary of which the Company owns, directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock as it does (vimmediately prior to such Asset Sale) in respect of the Restricted Subsidiary whose assets or Capital Stock are included in such Asset Sale; provided that (A) the following Persons may make a capital expenditure;
purchase or investment in accordance with the foregoing: (vix) acquire other the Company, (y) a Wholly Owned Subsidiary or (z) in the case of an Asset Sale in respect of assets or Capital Stock held by a Restricted Subsidiary only, a Restricted Subsidiary of which the Company, owns directly or indirectly, an equal or greater percentage of the economic and voting interests of its Capital Stock as it does of the Restricted Subsidiary that made such Asset Sale and (B) no purchase from the Company or any Restricted Subsidiary will satisfy the provisions of this clause (2) (each, other than Capital Stock and cash or Cash Equivalents) that are used or useful in the Company, a Similar Business;
(vii) consummate any combination of the foregoing; or
(viii) enter into a binding commitment to apply the Net Available Cash pursuant to Section 4.05(b)(i“Permitted Investing Subsidiary”), Section 4.05(b)(iii), Section 4.05(b)(iv), Section 4.05(b)(v) or Section 4.05(b)(vi) or a combination thereof; provided thatthat (x) in the case of clause (2) above, a binding commitment shall be treated as a permitted application of the Net Available Cash Proceeds from the date of such commitment until so long as the earlier Company, or such Restricted Subsidiary enters into such commitment with the good faith expectation that such Net Cash Proceeds will be applied to satisfy such commitment within 90 days of such commitment (an “Acceptable Commitment”) and such Net Cash Proceeds are actually applied to satisfy such commitment within the later of (xi) 360 days after receipt of the Net Cash Proceeds from the related Asset Sale and (ii) 90 days after the date on which of such investment is consummated, binding commitment and (y) to the 180th day following extent such Net Cash Proceeds are not actually applied to satisfy such commitment within the expiration of period set forth in clause (x) above, the aforementioned 360-day period, if the investment has Net Cash Proceeds not been consummated by that dateso applied shall constitute Excess Proceeds.
(c) The amount To the extent all or a portion of the Net Cash Proceeds of any Asset Sale are not applied within 360 days thereof (or such Net Available Cash not so used longer period as set forth permitted pursuant to an Acceptable Commitment as provided in Section 3.12(b) above) as described in clause (1) or (2) of Section 3.12(b) above constitutes (“Excess Proceeds.” Pending the final application of any such Net Available Cash”), the Parent or any Restricted Subsidiary may temporarily reduce revolving credit borrowings or otherwise utilize such Net Available Cash in any manner that is not prohibited by the terms of this Indenture.
(d) On the 361st day (or the 541st day if a binding commitment as described in Section 4.05(b)(viii) is entered into) after an Asset Disposition, or such earlier time as the Issuer elects, if the aggregate amount of Excess Proceeds exceeds $60 million, the Issuer Company will be required within twenty (20) Business Days thereof to make an offer to purchase Notes (an “Asset Disposition Sale Offer”) to all Holders and, to the extent the Issuer elects, to all or some holders of other outstanding Senior Indebtedness that is Pari Passu Indebtedness, to purchase the maximum principal amount of Notes and any such other Senior Indebtedness that may be purchased out of the Excess Proceeds), at an offer price, in respect of the Notes, a purchase price equal to no less than 100% of the principal amount thereof of the Notes to be purchased, plus accrued and unpaid interestinterest thereon, if any, to, but not including, to the date of purchasepurchase (the “Asset Sale Offer Amount”). The Company will purchase pursuant to an Asset Disposition Sale Offer from all tendering Holders on a pro rata basis in respect the manner provided in Section 5.5, and, at the Company’s option, on a pro rata basis with the holders of any other Senior Indebtedness with similar provisions requiring the Company to offer to purchase the other Senior Indebtedness with the proceeds of Asset Sales, that principal amount (or accreted value in the case of Indebtedness issued with original issue discount) of Notes and the other Senior Indebtedness to be purchased equal to such unapplied Net Cash Proceeds. The Company may satisfy its Obligations under this Section 3.12 with respect to any Net Cash Proceeds by making an Asset Sale Offer prior to the expiration of 360 days from the relevant Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b) above, the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in Section 3.12(b) above).
(d) The purchase of Notes pursuant to an Asset Sale Offer will occur not less than 20 Business Days following the date thereof, or any longer period as may be required by law, nor more than 45 days following the 360th day following the Asset Sale (or, in the event an Acceptable Commitment has been entered into as set forth in Section 3.12(b), the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in such Section 3.12(b)). The Company may, however, defer an Asset Sale Offer until there is an aggregate amount of unapplied Net Cash Proceeds from one or more Asset Sales equal to or in excess of $7.5 million. At that time, the entire amount of unapplied Net Cash Proceeds, and not just the amount in excess of $7.5 million, will be made applied as required pursuant to this Section 3.12. Pending application in accordance with this Section 3.12, Net Cash Proceeds will be applied to temporarily reduce revolving credit borrowings, Invested in Cash Equivalents or used for general corporate purposes.
(e) Each Asset Sale Offer Notice will be mailed first class, postage prepaid, to the procedures record Holders as shown on the register of Holders within 30 days following such 360th day (or, in the event an Acceptable Commitment has been entered into as set forth in this IndentureSection 3.12(b) above, the later date of the 360th day following the Asset Sale or the expiration of the 90-day period set forth in minimum denominations such Section 3.12(b)), with a copy to the Trustee offering to purchase the Notes as described above. Each Asset Sale Offer Notice will state, among other things, the purchase date, which must be no earlier than 30 days nor later than 60 days from the date the notice is mailed, other than as may be required by law (the “Asset Sale Offer Payment Date”). Upon receiving notice of an Asset Sale Offer, Holders may elect to tender their Notes in whole or in part in a principal amount of $200,000 and in 2,000 or integral multiples of $1,000 in excess thereofthereof in exchange for cash.
(ef) On the Asset Sale Offer Payment Date, the Company will, to the extent lawful:
(1) accept for payment all Notes or portions thereof properly tendered pursuant to the Asset Sale Offer;
(2) deposit with the Paying Agent funds in an amount equal to the Asset Sale Offer Amount in respect of all Notes or portions thereof so tendered; and
(3) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Company.
(g) To the extent Holders of Notes and holders of other Senior Indebtedness, if any, which are the subject of an Asset Sale Offer properly tender and do not withdraw Notes or the other Senior Indebtedness in an aggregate amount exceeding the amount of unapplied Net Cash Proceeds, the Company will purchase the Notes and the other Senior Indebtedness on a pro rata basis (based on amounts tendered). If only a portion of a Note is purchased pursuant to an Asset Sale Offer, a new Note in a principal amount equal to the portion thereof not purchased will be issued in the name of the Holder thereof upon cancellation of the original Note (or appropriate adjustments to the principal amount of a global Note will be made, as appropriate). Notes (or portions thereof) purchased pursuant to an Asset Sale Offer will be cancelled and cannot be reissued. Upon completion of any such an Asset Disposition Sale Offer, the amount of Excess Net Cash Proceeds that resulted in the requirement to make an Asset Disposition Offer shall will be reset at zero. Accordingly, to zero (regardless of whether there are any remaining Excess Proceeds upon such completion). Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Parent and its Restricted Subsidiaries may use such Net Available Cash for any purpose not prohibited by this Indenture. If extent that the aggregate amount of Notes and such other Senior Indebtedness validly tendered and not properly withdrawn pursuant to an Asset Disposition Sale Offer exceeds is less than the aggregate amount of Excess unapplied Net Cash Proceeds, the Excess Company may use any remaining Net Cash Proceeds shall be allocated among the tendering Holders of Notes and such other Senior Indebtedness pro rata based on the aggregate principal amount of Notes and such other Senior Indebtedness so tendered and not properly withdrawn. For the for general corporate purposes of calculating the principal amount of any such Indebtedness tendered in an Asset Disposition Offer that is not denominated in U.S. dollar, such principal amount shall be converted into Company and its U.S. Dollar Equivalent as of a date selected by the Issuer that is within the Asset Disposition Offer Period or no more than five (5) Business Days prior to the beginning of the Asset Disposition Offer Period. Upon completion of any Asset Disposition Offer, the amount of Excess Proceeds shall be reset at zero.
(f) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than the currency in which the relevant Notes are denominated, the amount thereof payable in respect of such Notes shall not exceed the net amount of funds in the currency in which such Notes are denominated that is actually received by the Issuer upon converting such portion of the Net Available Cash into such currency.
(g) The Asset Disposition Offer, insofar as it relates to the Notes, will remain open for a period of not less than five (5) Business Days following its commencement (the “Asset Disposition Offer Period”). No later than five (5) Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”), the Issuer will purchase the principal amount of Notes and, to the extent it elects, Senior Indebtedness required to be repaid or purchased by it pursuant to such offer (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Senior Indebtedness that is Pari Passu Indebtedness validly tendered in response to the Asset Disposition OfferRestricted Subsidiaries.
(h) The Parent and its Restricted Subsidiaries may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to such Net Available Cash prior to the expiration of the relevant 360 days (or such longer period provided above) respect to all or part of the Net Available Cash in advance of being required to do so by this Indenture.
(i) The Issuer Company will comply, to the extent applicable, comply with the requirements of Section 14(e) of Rule 14e-1 under the Exchange Act and any other applicable securities laws or regulations in connection with the repurchase purchase of Notes pursuant to this Indenturean Asset Sale Offer. To the extent that the provisions of any applicable securities laws or regulations conflict with provisions of this Section 4.053.12, the Issuer Company will comply with the applicable securities these laws and regulations and will not be deemed to have breached its obligations under this Indenture Section 3.12 by virtue of such compliancedoing so.
(j) Except as otherwise provided in Section 9.01, the provisions of this Indenture relating to the Issuer’s obligation to make an Asset Disposition Offer may be waived or modified with the consent of Holders of a majority in outstanding principal amount of the Notes (with such consent, for the avoidance of doubt, to be considered effective if the aggregate principal amount of the Notes of consenting Holders represents a majority of the aggregate outstanding principal amount of the Notes as a whole and without regard to the level of consent obtained among Holders of each constituent series of Notes).
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Sources: Indenture (MDC Partners Inc)