Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless: (1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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) of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap); (2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and (3) within 18 months from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied: (i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary; (ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or (iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero. (c) Notwithstanding any other provisions of this Section 3.5, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default. (d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash: (1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition; (2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition; (3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and (4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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). (e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof. (f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Thor Industries Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)) with a purchase price in excess of $50.0 million, other than in a sale of the Budget Truck Division for fair market value, at least 75% of the consideration from such Asset Disposition (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) ), received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 450 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”)Disposition, an amount equal to the 100% of such Net Available Cash is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness)):
(A) to the extent the assets disposed of in the Asset Disposition constituted Collateral, to repay (i) reduce, prepay, repay or purchase any First Lien Obligations under a Debt Facility to (or any Refinancing Indebtedness in respect thereof), including the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsNotes, to correspondingly reduce commitments with respect thereto); or (ii) Obligations under Secured to make an offer (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer) to redeem Notes pursuant to Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions; provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness of the Company or a Guarantor pursuant to this clause (and in the case of revolving obligationsa), to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; ;
(iiiB) to the extent the assets disposed of in the Asset Disposition did not constitute Collateral, to (i) reduce, prepay, repay or purchase any First Lien Obligations under the Notes (or any other Refinancing Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than in respect thereof), including the Notes, the Company will either (1ii) reduce Obligations under the Notes on a pro rata basis byreduce, at its optionprepay, repay or purchase Pari Passu Indebtedness, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2iii) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders redeem Notes pursuant to Section 5.7 or purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereofthrough open-market purchases or in privately negotiated transactions, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) reduce, prepay, repay or purchase any Indebtedness of a Restricted Subsidiary that is not a GuarantorNon-Guarantor (in each case, other than Indebtedness owed to the Company or another any Restricted Subsidiary;
); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (ii) B), 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 Company assets sold or any Restricted Subsidiary electsotherwise 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; and/or
(C) to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary)) within 450 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; commitment, provided that that, (1) pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clause (A) or (B) of Section 3.53.5(a)(3), the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture Indenture; and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 (iiSection 3.5(a)(3)(C) above with respect to such Asset Disposition.
(b) The amount of any Net Available Cash from Asset Dispositions of Collateral that is not applied or invested or committed to be applied or invested as provided in the preceding paragraph will be deemed to constitute “Collateral Excess Proceeds” under this Indenture. IfOn the 451st day after the later of an Asset Disposition or the receipt of such Net Available Cash, if the aggregate amount of Collateral Excess Proceeds under this Indenture exceeds (i) $100.0 million, in the case of a single transaction or a series of related transactions, or (ii) $200.0 million aggregate amount in any fiscal year, the Company will within 10 Business Days be required to make an offer (“Collateral Asset Disposition Offer”) to all Holders of Notes issued under this Indenture and, to the extent the Company elects, to all holders of other outstanding First Lien Obligations or Obligations secured by a Lien permitted under this Indenture on the Collateral disposed of (which Lien is not subordinated to the Lien of the Notes with respect to the Collateral), to purchase the maximum principal amount of Notes and any such First Lien Obligations or other Obligations, as the case may be, to which the Collateral Asset Disposition Offer applies that may be purchased out of the Collateral Excess Proceeds, at an offer price equal to 100% of the principal amount thereof (or such lesser price with respect to First Lien Obligations or other Obligations, if any, as may be provided by the terms of such other Indebtedness), in each case, plus accrued and unpaid interest, if any, to, but not including, the date of purchase, in accordance with the procedures set forth in this Indenture or the agreements governing the First Lien Obligations or other Obligations, as applicable, and, with respect to the Notes, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. The Company will deliver notice of such Collateral Asset Disposition Offer electronically or by first-class mail, with a copy to the Trustee, to each Holder of Notes at the address of such Holder appearing in the security register or otherwise in accordance with the procedures of DTC, describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is delivered, pursuant to the procedures required by this Indenture and described in such notice. The Company may satisfy the foregoing obligations with respect to any Net Available Cash from an Asset Disposition, at Disposition by making a Collateral Asset Disposition Offer with respect to all Net Available Cash prior to the expiration of the Proceeds Application Period relevant 450 days (or such longer period provided above) or with respect to any unapplied Collateral Excess Proceeds.
(c) To the extent that the aggregate amount of Notes and First Lien Obligations or other Obligations secured by a Lien permitted under this Indenture on the Collateral disposed of (which Lien is not subordinated to the Lien of the Notes with respect to the Collateral), as the case may be, so validly tendered and not properly withdrawn pursuant to a Collateral Asset Disposition Offer is less than the Collateral Excess Proceeds, the Company may use any remaining Collateral Excess Proceeds for any purpose not prohibited by this Indenture. If the aggregate principal amount of the Notes surrendered in any Collateral Asset Disposition Offer by Holders and other First Lien Obligations or other Obligations, as the case may be, surrendered by holders or lenders, collectively, exceeds the amount of Collateral Excess Proceeds, the Collateral Excess Proceeds shall be allocated among the Notes and First Lien Obligations or other Obligations, as the case may be, to be purchased on a pro rata basis on the basis of the aggregate principal amount of tendered Notes and First Lien Obligations or other Obligations, as the case may be; provided that no Notes or other First Lien Obligations or other Obligations, as the case may be, 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. Additionally, the Company may, at its option, make a Collateral Asset Disposition Offer using proceeds from any Asset Disposition of Collateral at any time after the consummation of such Asset Disposition. Upon consummation or expiration of any Collateral Asset Disposition Offer, there remains any remaining Net Available Cash in excess of $60.0 million (shall not be deemed Collateral Excess Proceeds and the Company may use such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such for any purpose not prohibited by this Indenture.
(d) The amount of any Net Available Cash from Asset Dispositions that are does not constitute Collateral and that is not applied or invested or committed to be applied or invested as provided in excess of $60.0 million, the preceding paragraph will be deemed to constitute “Excess Proceeds”)” under this Indenture. On the 451st day after the later of an Asset Disposition or the receipt of such Net Available Cash, thenif the aggregate amount of Excess Proceeds under this Indenture exceeds (i) $100.0 million, subject to in the limitations with respect to Foreign Dispositions set forth belowcase of a single transaction or a series of related transactions, or (ii) $200.0 million aggregate amount in any fiscal year, the Company shall within 10 Business Days be required to make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes issued under this Indenture and, if required by to the terms of any Pari Passu Indebtednessextent the Company elects, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, in the case of the Notes, in cash price in an amount equal to 100% of the principal amount thereof (or accreted value thereof, if less), 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), in each case, plus accrued and unpaid interest, if any, to, but not including, the date fixed for the closing of such offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and, with respect to the Notes, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices The Company shall deliver notice of an such Asset Disposition Offer shall be sent electronically or by first 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 DTCmail, with a copy to the Trustee, to each Holder of Notes at the address of such Holder appearing in the Notes Register or otherwise in accordance with the procedures of DTC, describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is delivered, pursuant to the procedures required by this Indenture and described in such notice. The Company may satisfy the foregoing obligation obligations with respect to the any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to all Net Available Cash prior to the expiration of the Proceeds Application Period relevant 450 days (the “Advance Offer”or such longer period provided above) or 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 Indentureany unapplied Excess Proceeds.
(be) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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 OfferExcess Proceeds, the Company may include use any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (orProceeds, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero. Additionally, the Company may, at its option, make an Asset Disposition Offer using proceeds from any Asset Disposition at any time after the consummation of such Asset Disposition. Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Company may use such Net Available Cash for any purpose not prohibited by this Indenture.
(cf) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(g) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash so affected will not be required to be applied in compliance with this Section 3.5covenant, and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulationlaw, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company to within one year 180 days following the date on which the respective payment would otherwise have been required, promptly take all commercially reasonable actions reasonably required by with respect to the applicable local law or regulationlaw, applicable organizational documents impediments or other impediments impediment to permit such repatriation), and if within one year 180 days following the date on which the respective payment would otherwise have been required required, such repatriation of any of such affected Net Available Cash is permitted under the 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 (5) Business Days after such repatriation could be made) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.Taxes
Appears in 1 contract
Sources: Indenture (Avis Budget Group, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset DispositionDisposition , or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (a) to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase any Indebtedness of a Non-Guarantor Subsidiary (in each case, other than Indebtedness owed to the Company or a Guarantor any Restricted Subsidiary) or any Secured Indebtedness, including Indebtedness under the Credit Agreements (and or any Refinancing Indebtedness in the case of revolving obligations, to correspondingly reduce commitments with respect theretothereof); provided that provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiii) Obligations under to prepay, repay or purchase Pari Passu Indebtedness; provided further that, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) of extent the Company redeems, repays or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior repurchases such Indebtedness other than the Notespursuant to this clause (ii), the Company will either (1) shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 5.7 through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 75 million (such amount of Net Available Cash that are less than or equal to $60.0 75 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 75 million, “Excess Proceeds”), then, 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 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 130 million and (b) 7.515.0% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Owens & Minor Inc/Va/)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Board of Directors of the Company, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (is applied by the Issuers or such Restricted Subsidiary, as the case may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is appliedbe:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (A) to prepay, repay or purchase any Indebtedness of a Non-Guarantor, Indebtedness that is secured by a Lien or Permitted Funding Indebtedness (i) Obligations under a Debt Facility in each case, other than Indebtedness owed to the extent such Obligations were Incurred under clause Company or any Restricted Subsidiary) within 365 days from the later of (1) the date of such Asset Disposition and (2) the second paragraph under Section 3.2 receipt of such Net Available Cash; provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (and in the case of revolving obligationsi), to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing to prepay, repay or purchase Pari Passu Indebtedness; provided further that, to the extent the Company redeems, repays or repurchases Pari Passu Indebtedness pursuant to this clause (B), the Company shall equally and ratably reduce obligations under the Notes as provided under Section 5.7, through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;or
(ii) to the extent the Company or any such Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including Securitization Assets and by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company or another Restricted Subsidiary)) within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Company that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment investment is consummated within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing365th day; provided that (1) that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clause (i) or clause (ii) in Section 3.53.5(a)(3), the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit FacilitiesPermitted Funding Indebtedness) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture and Indenture.
(2b) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Any Net Available Cash attributable to any given from Asset Disposition (provided Dispositions that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, execution of a definitive agreement for the relevant Asset Disposition, and consummation of the relevant Asset Disposition) and deem the amount so is not applied or invested or committed to be applied pursuant or invested as provided in the preceding paragraph will be deemed to and in accordance with clause (ii) above with respect to such Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, constitute “Excess Proceeds”)” under this Indenture. On the 366th day after the later of an Asset Disposition or the receipt of such Net Available Cash, then, subject to if the limitations with respect to Foreign Dispositions set forth belowaggregate amount of Excess Proceeds under this Indenture exceeds $25.0 million, the Company shall Issuers will within 10 Business Days be required to make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes issued under this Indenture and, if required by to the terms of any Pari Passu Indebtednessextent the Issuers elect, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, price in the case respect of the Notes, in cash Notes in an amount equal to 100% of the principal amount thereof (or accreted value thereof, if less), of the Notes plus accrued and unpaid interest, if any (or such lesser price with respect to Pari Passu Indebtednessinterest and Additional Interest, 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 offerpurchase, in accordance with the procedures set forth in this Indenture and Section or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices The Issuers will deliver notice of an such Asset Disposition Offer shall be sent electronically or by first 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 DTCmail, with a copy to the Trustee. The Company may satisfy , to each Holder of Notes at the foregoing obligation address of such Holder appearing in the security register or otherwise in accordance with respect the procedures of DTC, describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is delivered, pursuant to the Net Available Cash 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 procedures required to do so by this IndentureIndenture and described in such notice.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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 OfferExcess Proceeds, the Company Issuers may include use any remaining Excess Proceeds (orfor general corporate purposes, subject to other covenants contained in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (orProceeds, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness in accordance with the procedures set forth in this Indenture or the agreements governing the Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected , as applicable, and purchased in an unauthorized denominationminimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(cd) Notwithstanding any other provisions of this Section 3.5,
(i) to To the extent that any portion of or all the Net Available Cash payable in respect of any Asset Disposition by the Notes is denominated in a Foreign Subsidiary or a CFC Holding Company (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 currency other onerous organizational or administrative impediments from being repatriated to the United Statesthan U.S. dollars, the portion amount thereof payable in respect of such Net Available Cash so affected will the Notes shall not be required to be applied exceed the net amount of funds in compliance with this Section 3.5, and such amounts may be retained U.S. dollars that is actually received by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments to permit Issuers upon converting 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Defaultportion into U.S. dollars.
(de) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1i) the assumption by the transferee of Indebtedness or other liabilities, liabilities contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2ii) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3iii) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(iv) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(4v) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 70.0 million and (b) 7.52.5% of LTM EBITDA Total Assets (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).
(ef) Upon the commencement of an Asset Disposition Offer, the Issuers shall send, or cause to be sent, electronically or by first class mail, a notice to the Trustee and to each Holder at its registered address or otherwise in accordance with the procedures of DTC. 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:
(1) that the Asset Disposition Offer is being made pursuant to this Section 3.5 and that, to the extent lawful, all Notes tendered and not withdrawn shall be accepted for payment (unless prorated);
(2) the Asset Disposition payment amount, the Asset Disposition offered price, and the date on which Notes tendered and accepted for payment shall be purchased, which date shall be at least 30 days and not later than 60 days from the date such notices is mailed (the “Asset Sale Payment Date”);
(3) that any Notes not tendered or accepted for payment shall continue to accrue interest in accordance with the terms thereof;
(4) that, unless the Issuers default in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrue interest on and after the Asset Sale Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to any Asset Disposition Offer shall be required to surrender the Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice at least three Business Days before the Asset Sale Payment Date;
(6) that Holders shall be entitled to withdraw their election if the Paying Agent receives, not later than two Business Days prior to the Asset Sale Payment 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 ▇▇▇▇▇▇ is withdrawing its election to have such Note purchased;
(7) that if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition payment amount, the Issuers shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Issuers so that only Notes in minimum denominations of $2,000 or integral multiples of $1,000 in excess thereof shall be purchased); and
(8) 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).
(g) If the Asset Sale Payment Date is on or after a record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Asset Disposition Offer.
(h) On the Asset Sale Payment Date, the Issuers will, to the extent permitted by law,
(1) accept for payment all Notes issued by it or portions thereof properly tendered pursuant to the Asset Disposition Offer,
(2) deposit with the Paying Agent an amount equal to the aggregate Asset Disposition payment in respect of all Notes or portions thereof so tendered, and
(3) deliver, or cause to be delivered, to the Trustee for cancellation the Notes so accepted together with an Officer’s Certificate to the Trustee stating that such Notes or portions thereof have been tendered to and purchased by the Issuers.
(i) The Company Issuers will comply comply, to the extent applicable, with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those such laws and or regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 3.5. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this Indenture, the Company Issuers will comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its their obligations described in under this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions Disposition (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 455 days from the later of (A) the date 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 the 100% of such Net Available Cash is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects elects:
(or is required by the terms of any Indebtedness), to repay (ia) Obligations under a Debt Facility to the extent such Net Available Cash are from an Asset Disposition of Collateral, (x) to reduce, prepay, repay or purchase any First Lien Obligations were Incurred (other than the Notes), including Indebtedness under clause the Credit Agreement (1) of the second paragraph under Section 3.2 (and or any Refinancing Indebtedness in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretothereof); provided that the Company ratably repay the Notes, (y) to make an offer (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer or Asset Disposition Offer), redeem Notes as described under Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (z) to reduce, prepay, repay or purchase any Indebtedness of a Non-Guarantor (in each case, other than Indebtedness owed to the Company or any Restricted Subsidiary); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased;
(b) to the extent such Net Available Cash is from an Asset Disposition that does not constitute Collateral, (w) to reduce, prepay, repay or purchase any Indebtedness secured by a Lien on such asset, (x) to reduce, prepay, repay or purchase Pari Passu Indebtedness; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of provided, that the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so ratably repay any senior Indebtedness other than the Notes, the Company will either (1y) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer), redeem Notes as described under Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (z) to all Holders to reduce, prepay, repay or purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) any Indebtedness of a Restricted Subsidiary that is not a GuarantorNon-Guarantor (in each case, other than Indebtedness owed to the Company or another any Restricted Subsidiary;
); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (ii) i), 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 Company assets sold or any Restricted Subsidiary electsotherwise 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;
(a) 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 equal Subsidiary); or (b) to invest (including capital expenditures) in any one or more businesses (provided that any such business will be a Restricted Subsidiary), properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event of any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Company or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; provided, further, that if any Second Commitment is later cancelled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Collateral Excess Proceeds or Excess Proceeds, 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 Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset DispositionDisposition of Collateral, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of the greater of $60.0 75.0 million and 10.0% of LTM EBITDA (such amount, “Collateral Excess Proceeds”), then subject to the limitations with respect to Foreign Dispositions set forth below, the 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 of Notes and, if required by the terms of any First Lien Obligations or Obligations secured by a Lien permitted under this Indenture on the Collateral disposed of (which Lien is not subordinate to the Lien of the Notes with respect to the Collateral), to all holders of such First Lien Obligations or other Obligations, to purchase the maximum principal amount of such Notes and First Lien Obligations or other Obligations, as appropriate, on a pro rata basis, that may be purchased out of such Collateral 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 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 First Lien Obligations or other Obligations, 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 First Lien Obligations or other Obligations, as applicable, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices of a Collateral 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. The Company may satisfy the foregoing obligation with respect to any Net Available Cash that are less than from an Asset Disposition by making an Asset Disposition Offer prior to the expiration of the Proceeds Application Period (the “Collateral Advance Offer”) with respect to all or equal to $60.0 million, “Declined Excess Proceeds,” and such amount 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 are the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other First Lien Obligations or Obligations secured by a Lien permitted under this Indenture on the Collateral disposed of, as the case may be, 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 an 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 (or accreted value, as applicable) of the Notes or, if applicable, First Lien Obligations or other Obligations, as the case may be, 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, First Lien Obligations and other Obligations to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes, First Lien Obligations and other Obligations; provided that no Notes, First Lien Obligations or other Obligations 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 that does 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 the greater of $60.0 million75.0 million and 10.0% of LTM EBITDA (such amount, “Excess Proceeds”), then, 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 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 any 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 or otherwise surrendered in connection with an Asset Disposition Offer made with Excess Proceeds is less than the amount offered in an Asset Disposition Offer (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 use any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in (the “Declined Excess Proceeds, and use such Declined Excess Proceeds ”) for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero. To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition are received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulationlaw, applicable organizational documents impediments or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.repatriate
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
unless (1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value, as determined in good faith by the Board of Directors (including as to the value (such fair market value to be determined on the date of contractually agreeing to such Asset Disposition) all non-cash consideration), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), and at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition , and (Bii) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company (or any such Restricted Subsidiary, as the case may be) (A) first, (x) to the extent the Company elects (or is required by the terms of any Senior Indebtedness), to prepay, repay or purchase Senior Indebtedness of the Company) within 360 days of such Asset Disposition, (iy) Obligations under at the Company's election to the investment by the Company or any Wholly Owned Subsidiary or such Restricted Subsidiary in long-term assets to replace the assets that were the subject of such Asset Disposition or a Debt Facility long-term asset that (as determined in good faith by the Board of Directors) is directly related to the business of the Company and the Restricted Subsidiaries existing on December 17, 2001, in each case within 360 days from the date of such Asset Disposition, or (z) a combination of the foregoing purposes within such 360-day period; (B) second, to the extent of the balance of such Obligations were Incurred under Net Available Cash after application in accordance with clause (1A), to make a pro rata offer to purchase Notes at par (and, to the extent required by the instrument governing such Indebtedness, any other Senior Subordinated Indebtedness designated by the Company, at a price no greater than par) plus accrued and unpaid interest, and (C) third, to the extent of the second paragraph balance of such Net Available Cash after application in accordance with clauses (A) and (B), for general corporate purposes otherwise not prohibited under Section 3.2 this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (and in the case of revolving obligationsA) or (B) above, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will shall retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), 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 4.17, the Company and its Restricted Subsidiaries shall not be required to apply any Net Available Cash in accordance with this Section except to the extent that the aggregate Net Available Cash from all Asset Dispositions (iiiincluding any Asset Dispositions made since December 17, 2001) Obligations under which are not applied in accordance with this Section exceeds $10 million. Pending application of Net Available Cash pursuant to this Section, such Net Available Cash shall be used to temporarily reduce Senior Indebtedness or invested in Cash Equivalents. For the Notes purposes of this Section 4.17, the following is deemed to be cash or any other Cash Equivalents: the express assumption of Indebtedness (other than Subordinated Indebtednessany Indebtedness that is by its terms subordinated to the Notes) of the Company or any Restricted Subsidiary; provided , but only to the extent that if such assumption is effected on a basis under which there is no further recourse to the Company or any of the Restricted Subsidiary shall so repay any senior Subsidiaries with respect to such liabilities
(b) In the event of an Asset Disposition that requires the purchase of Notes (and other Senior Subordinated Indebtedness other than of the NotesCompany) pursuant to Section 4.17(a)(ii)(B), the Company will either (1) reduce Obligations under purchase Notes tendered pursuant to an offer by the Company for the Notes on (and, to the extent required, other Senior Subordinated Indebtedness of the Company) (the "Offer") at a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than price of 100% of the their principal amount thereof, (without premium) plus the amount of accrued but unpaid interestinterest (or, if any, thereon up to the principal amount in respect of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) such other Senior Subordinated Indebtedness of a Restricted Subsidiary that is not a Guarantorthe Company, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), plus accrued and unpaid interest, if any (or such lesser price with respect to Pari Passu Indebtednessprice, if any, as may be provided for by the terms of such other Indebtedness), to, but not including, Senior Subordinated Indebtedness of the date fixed for the closing of such offer, Company) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture and Section 4.17(c). If the agreement governing aggregate purchase price of Notes (and, to the Pari Passu Indebtednessextent required, as applicableany other Senior Subordinated Indebtedness of the Company) tendered pursuant to the Offer is less than the Net Available Cash allotted to the purchase thereof, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices of an Asset Disposition Offer the Company shall be sent by first class mail or sent electronically, at least 10 days but not more than 60 days before required to apply the purchase date to each Holder of the Notes at such Holder’s registered address or otherwise remaining Net Available Cash in accordance with the applicable procedures Section 4.17(a)(ii)(C). The Offer shall remain open for a period of DTC, with a copy to the Trustee20 Business Days. The Company may satisfy will not be required to make an Offer to purchase Notes (and other Senior Subordinated Indebtedness of the foregoing obligation Company) pursuant to this Section 4.17 if the Net Available Cash available therefor is less than $10 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 by making from any subsequent Asset Disposition).
(1) Promptly, and in any event within 30 days after the Company becomes obligated to make an Asset Disposition Offer prior Offer, the Company shall be obligated to deliver to the expiration Trustee and send, by first-class mail to each Holder, a written notice stating that the Holder 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 such information which the Company in good faith believes will enable such Holders to make an informed decision.
(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 Proceeds Application Period Offer (the “Advance Offer”"Offer Amount"), (ii) with respect to all or a part the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being made and (iii) the compliance of such allocation with the provisions of Section 4.17(a). Upon the expiration of the period for which the Offer remains open (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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance PortionPeriod"), the Company shall allocate deliver to the Excess Proceeds among Trustee for cancellation the Notes or portions thereof which have been properly tendered to and Pari Passu Indebtedness 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 the aggregate purchase price of the Notes delivered by the Company to the Trustee is less than the Offer Amount, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section.
(3) Holders 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 not later than 3:00 p.m., New York City time, two 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 3:00 p.m., New York City time, two Business Days prior to the Purchase Date, a telegram, telex, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note which was delivered for purchase by the Holder and a statement that such Holder is withdrawing his election to have such Note purchased. If at the expiration of the Offer Period the aggregate principal amount of Notes surrendered by Holders exceeds the Offer Amount, the Company shall select the Notes to be purchased on a pro rata basis on taking into account any other tendered Senior Subordinated Indebtedness which is the basis subject of such offer (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). Holders whose Notes are purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zerosurrendered.
(c4) Notwithstanding any other provisions At the time the Company delivers Notes to the 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 3.5,
(i) Section. A Note 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 extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Defaultsurrendering Holder.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the The Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositionshall comply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 4.17. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture Section 4.17 by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Terex Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The From and after the Effective Date, the Company shall will not, and shall will not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
(1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value (such fair market value to be determined on as of the date of contractually agreeing to on which a legally binding commitment for such Asset DispositionDisposition was entered into) of the shares and assets subject to such Asset Disposition Disposition, as such fair market value may be determined (includingand shall be determined, for to the avoidance of doubt, if extent such Asset Disposition is a Permitted or any series of related Asset SwapDispositions involves aggregate consideration in excess of $50.0 million) in good faith by the Company, whose determination shall be conclusive (including as to the value of all noncash consideration);
(2ii) in the case of any such Asset Disposition, Disposition (or series of related Asset Dispositions Dispositions) having a Fair Market Value (except to as of the extent the date on which a legally binding commitment for such Asset Disposition is a Permitted Asset Swap)was entered into) of $50.0 million or more, at least 7575.0% of the consideration therefor (including excluding, in the 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) from such Asset Disposition, that are not Indebtedness), together with all other Asset Dispositions since the Issue Effective Date (on a cumulative basis) ), received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalentscash; and
(3iii) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company (or any Restricted Subsidiary, as the case may be) in accordance with, and to the extent required by, Section 411(b) or Section 411(c), as applicable.
(b) To the extent that such Net Available Cash is from an Asset Disposition from and after the Effective Date of any Collateral, an amount equal to 100.0% (as may be adjusted pursuant to clause (3) of the last proviso to this Section 411(b)) of the Net Available Cash from such Asset Disposition is applied by the Company (or any Restricted Subsidiary, as the case may be) as follows:
(A) first, either (x) to the extent the Company or such Restricted Subsidiary elects (or is required by the terms of any IndebtednessIndebtedness under the Senior ABL Facility or any other Indebtedness having Senior Lien Priority), to prepay, repay or purchase any such Indebtedness or Obligations in respect thereof or (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsletters of credit, to correspondingly reduce commitments with respect thereto); (iibankers’ acceptances or other similar instruments) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than cash collateralize any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness Obligations in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment thereof (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, case other than Indebtedness owed to the Company or another a Restricted Subsidiary;
) within 365 days after the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash or (iiy) to the extent the Company or any such Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary with an amount equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary) within 365 days from the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash; provided that the Company or the applicable Restricted Subsidiary will be deemed to have complied with the provisions of this clause (A) if and to the extent that, within 365 days after the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash, the Company or such Restricted Subsidiary has entered into and not abandoned or rejected a binding agreement to apply such Net Available Cash in accordance with this clause (A), and such transaction is thereafter completed within 180 days after the end of such 365‑day period;
(B) second, to the extent of the balance of such Net Available Cash after application in accordance with clause (A) above (such balance, the “Excess Collateral Proceeds”), to make an offer to purchase Notes and (to the extent the Company or such Restricted Subsidiary elects, or is required by the terms thereof) to purchase, redeem or repay any Additional Obligations of the Company or a Restricted Subsidiary, or any other Indebtedness having Pari Passu Lien Priority pursuant and subject to the conditions of this Indenture and the agreements governing such other Indebtedness; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B) above (the amount of such balance, “Declined Excess Collateral Proceeds”), to fund (to the extent consistent with any other applicable provision of this Indenture) any general corporate purpose (including the repurchase, repayment or other acquisition or retirement of any Subordinated Obligations or the making of any other Restricted Payments); provided, however, that a binding agreement shall (1) in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A)(x) or (B) of this Section 411(b), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related loan commitment (if any) to be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that permanently reduced in an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)the principal amount so prepaid, repaid or purchased; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 (iiA)(y) above of this Section 411(b) with respect to such Asset Disposition; and (3) the foregoing percentage in this Section 411(b) shall be reduced to 50% if the Consolidated Secured Leverage Ratio would be equal to or less than 3.50:1.00 after giving pro forma effect to any application of such Net Available Cash as set forth herein (any Net Available Cash in respect of Asset Dispositions not required to be applied in accordance with this Section 411(b) as a result of the application of this proviso shall collectively constitute “Secured Leverage Ratio Collateral Excess Proceeds”). IfNotwithstanding the foregoing provisions of this Section 411(b), the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash or equivalent amount in accordance with this Section 411(b) except to the extent that the aggregate Net Available Cash from all Asset Dispositions or equivalent amount that is not applied in accordance with this Section 411(b) (excluding all Secured Leverage Ratio Collateral Excess Proceeds) exceeds $100.0 million. If the aggregate principal amount of Notes and/or other Indebtedness of the Company or a Restricted Subsidiary validly tendered and not withdrawn (or otherwise subject to purchase, redemption or repayment) in connection with an offer pursuant to Section 4.11(b)(B) exceeds the Excess Collateral Proceeds, the Excess Collateral Proceeds will be apportioned between such Notes and such other Indebtedness of the Company or a Restricted Subsidiary, with the portion of the Excess Collateral Proceeds payable in respect of such Notes to equal the lesser of (x) the Excess Collateral Proceeds amount multiplied by a fraction, the numerator of which is the outstanding principal amount of such Notes and the denominator of which is the sum of the outstanding principal amount of the Notes and the outstanding principal amount of the relevant other Indebtedness of the Company or a Restricted Subsidiary, and (y) the aggregate principal amount of Notes validly tendered and not withdrawn.
(c) To the extent that such Net Available Cash is from an Asset Disposition from and after the Effective Date of any assets not constituting Collateral (“Other Assets”), an amount equal to 100.0% (as may be adjusted pursuant to clause (3) of the last proviso to this Section 411(c)) of the Net Available Cash from such Asset Disposition is applied by the Company (or any Restricted Subsidiary, as the case may be) as follows:
(A) first, either (x) to the extent the Company or such Restricted Subsidiary elects (or is required by the terms of any Credit Facility Indebtedness, any Senior Indebtedness of the Company or any Subsidiary Guarantor or any Indebtedness of a Restricted Subsidiary that is not a Subsidiary Guarantor), to prepay, repay or purchase any such Indebtedness or Obligations in respect thereof or (in the case of letters of credit, bankers’ acceptances or other similar instruments) cash collateralize any such Indebtedness or Obligations in respect thereof (in each case other than Indebtedness owed to the Company or a Restricted Subsidiary) within 365 days after the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash or (y) to the extent the Company or such Restricted Subsidiary elects, to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary with an amount equal to Net Available Cash received by the Company or another Restricted Subsidiary) within 365 days from the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash; provided that the Company or the applicable Restricted Subsidiary will be deemed to have complied with the provisions of this clause (A) if and to the extent that, within 365 days after the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash, the Company or such Restricted Subsidiary has entered into and not abandoned or rejected a binding agreement to apply such Net Available Cash in accordance with this clause (A), and such transaction is thereafter completed within 180 days after the end of such 365‑day period;
(B) second, to the extent of the balance of such Net Available Cash after application in accordance with Section 411(c)(A) (such balance, the “Excess Other Proceeds”), to make an offer to purchase Notes and (to the extent the Company or such Restricted Subsidiary elects, or is required by the terms thereof) to purchase, redeem or repay any other Senior Indebtedness of the Company or a Restricted Subsidiary, pursuant and subject to the conditions of this Indenture and the agreements governing such other Indebtedness; and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with Sections 411(c)(A) and 411(c)(B) (the amount of such balance, “Declined Excess Other Proceeds”), to fund (to the extent consistent with any other applicable provision of this Indenture) any general corporate purpose (including the repurchase, repayment or other acquisition or retirement of any Subordinated Obligations or the making of other Restricted Payments); provided, however, that (1) in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A)(x) or (B) of this Section 411(c), 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; (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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, at execution of a definitive agreement for the expiration relevant Asset Disposition, and consummation of the Proceeds Application Period relevant Asset Disposition) and deem the amount so invested to be applied pursuant to and in accordance with clause (A)(y) of this Section 411(c) with respect to such Asset Disposition, there remains ; and (3) the foregoing percentage in this Section 411(c) shall be reduced to 50% if the Consolidated Secured Leverage Ratio would be equal to or less than 3.50:1.00 after giving pro forma effect to any application of such Net Available Cash as set forth herein (any Net Available Cash in excess respect of $60.0 million (such amount Asset Dispositions not required to be applied in accordance with this Section 411(c) as a result of Net Available Cash that are less than or equal to $60.0 million, the application of this proviso shall collectively constitute “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Secured Leverage Ratio Other Excess Proceeds”). Notwithstanding the foregoing provisions of this Section 411(c), 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 10 Business Days after the expiration of the Proceeds Application Period to extent that repatriating any or 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of from any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (a “Foreign Disposition”) is (x) would result in material adverse tax consequences to the Company or any of its Subsidiaries or (y) is 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 law from being repatriated to the United StatesStates (in the case of the foregoing clauses (x) and (y), as reasonably determined by the Company in good faith which determination shall be conclusive), the portion of such Net Available Cash so affected will not be required to be applied in compliance with the foregoing provisions of this Section 3.5411(c), and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so longInvested in, but only so longdistributed to or otherwise transferred to any other Foreign Subsidiary; provided that, as in the applicable local law or regulationcase of this clause (y), applicable organizational documents or agreements or other impediments will not permit repatriation to the United States (the Company hereby agreeing to use shall take commercially reasonable efforts (as determined in the Company’s reasonable business judgment) to otherwise cause the applicable Foreign Subsidiary or CFC Holding Company 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 or regulationlaw, applicable organizational documents impediments or other impediments 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 applicable local law, applicable organizational impediment or other impediment, can be achieved such repatriation will be promptly effected and 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 whether or not repatriation actually occurs) in compliance with the foregoing provisions of additional Taxes payable or reserved against this Section 411(c). The time periods set forth in this Section 411 shall not start until such time as a result thereof) (the Net Available Cash may be repatriated whether or not such repatriation actually occurs) . Notwithstanding the foregoing provisions of this Section 411(c), the Company and the Restricted Subsidiaries shall not be required to apply any Net Available Cash or equivalent amount in compliance accordance with this Section 3.5; and
(ii411(c) except to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, any of or all the aggregate Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but from all Asset Dispositions or equivalent amount that is not limited toapplied in accordance with this Section 411(c) (excluding all Secured Leverage Ratio Other Excess Proceeds) exceeds $100.0 million. If the aggregate principal amount of Notes and/or other Indebtedness of the Company or a Restricted Subsidiary validly tendered and not withdrawn (or otherwise subject to purchase, any repatriation whereby doing so redemption or repayment) in connection with an offer pursuant to Section 411(c)(B) exceeds the CompanyExcess Other Proceeds, any the Excess Other Proceeds will be apportioned between such Notes and such other Indebtedness of the Company or a Restricted Subsidiary, or any with the portion of their respective Affiliates and/or direct or indirect equity owners would incur the Excess Other Proceeds payable in respect of such Notes to equal the lesser of (x) the Excess Other Proceeds amount multiplied by a Tax liabilityfraction, including receipt the numerator of a Tax dividend, deemed dividend pursuant to Code Section 956 which is the outstanding principal amount of such Notes and the denominator of which is the sum of the outstanding principal amount of the Notes and the outstanding principal amount of the relevant other Indebtedness of the Company or a withholding TaxRestricted Subsidiary, and (y) the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the aggregate principal amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of DefaultNotes validly tendered and not withdrawn.
(d) For the purposes of Section 3.5(a)(2) hereof411(a)(ii), the following will be are deemed to be cash:
: (1) Temporary Cash Investments, Investment Grade Securities and Cash Equivalents, (2) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company (other than Disqualified Stock of the Company) or a Guarantor) any Restricted Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on payment of the principal amount of such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, 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; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.con
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)) with a purchase price in excess of the greater of $375.0 million and 15.0% of LTM EBITDA, if after giving pro forma effect to such Asset Disposition, the Consolidated First Lien Secured Leverage Ratio is greater than 3.50 to 1.00, at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 the Applicable Percentage of such Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company Issuer or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay ):
(i) Obligations (A) to reduce, prepay, repay or purchase any Secured Indebtedness, including Indebtedness under the Credit Agreement (or any Refinancing Indebtedness in respect thereof), (B) to reduce, prepay, repay or purchase Pari Passu Indebtedness, (C) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to redeem Notes as described under Section 5.7 hereof, or purchase Notes through open-market purchases or in privately negotiated transactions, or (D) to reduce, prepay, repay or purchase any Indebtedness of a Debt Facility Non-Guarantor (in each case, other than Indebtedness owed to the extent such Obligations were Incurred under Issuer or any Restricted Subsidiary); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (1) of i), the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Issuer or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, (A) 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 equal Subsidiary); or (B) to invest (including capital expenditures) in any one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryIssuer); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event that any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Issuer or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company Issuer or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company Issuer (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iib) above with respect to such Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of (i) $60.0 500.0 million or 20.0% of LTM EBITDA, in the case of a single transaction or a series of related transactions, or (ii) $1,000.0 million or 40.0% of LTM EBITDA aggregate amount in any fiscal year (in the cases of clauses (i) and (ii), such amount of Net Available Cash Applicable Proceeds that are less than or equal to $60.0 million500.0 million or 20.0% of LTM EBITDA or $1,000.0 million or 40.0% of LTM EBITDA, as applicable, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 million500.0 million or 20.0% of LTM EBITDA or $1,000.0 million or 40.0% of LTM EBITDA, as applicable, “Excess Proceeds”), then, then subject to the limitations with respect to Foreign Dispositions set forth below, the Company Issuer shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 Issuer may satisfy the foregoing obligation with respect to the Net Available Cash Applicable Proceeds 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 Applicable Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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 Issuer may include any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company Issuer shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero. Additionally, the Issuer may, at its option, make an Asset Disposition Offer using proceeds from any Asset Disposition at any time after the consummation of such Asset Disposition. Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Issuer may use such Net Available Cash for any purpose not prohibited by this Indenture.
(cd) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than U.S. Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in U.S. Dollars that is actually received by the Issuer upon converting such portion into U.S. Dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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 StatesStates or Canada, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulationlaw, applicable organizational documents or agreements or other impediments will not permit repatriation to the United States or Canada (the Company Issuer hereby agreeing to use reasonable efforts (as determined in the CompanyIssuer’s reasonable business judgment) to otherwise cause the applicable Foreign Subsidiary or CFC Holding Company to within one year following the date on which the respective payment would otherwise have been required, promptly take all commercially reasonable actions reasonably required by the applicable local law or regulationlaw, applicable organizational documents impediments or other impediments impediment to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required required, such repatriation of any of such affected Net Available Cash is permitted under the applicable local law, applicable organizational impediment impediments 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 (5) Business Days after such repatriation could be maderepatriation) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company Issuer has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the CompanyIssuer, any Restricted Subsidiaryof its Subsidiaries, any Parent Entity, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt as a result of a Tax dividend or deemed dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax) with respect to such Net Available Cash, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder)Subsidiary. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section 3.5(a)(2) hereof, the following will shall be deemed to be cash:
(1i) the assumption by the transferee of Indebtedness or other liabilities, liabilities contingent or otherwise of the Company Issuer or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company Issuer, the Co-Issuer or a Guarantor) and the release of the Company Issuer or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2ii) securities, notes or other obligations received by the Company Issuer or any Restricted Subsidiary of the Company from the transferee that are converted by the Company Issuer or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3iii) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Issuer and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(iv) consideration consisting of Indebtedness of the Issuer (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Issuer or any Restricted Subsidiary; and
(4v) any Designated Non-Cash Consideration received by the Company Issuer or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 750.0 million and (b) 7.530.0% of LTM EBITDA (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).
(eg) The Company will comply with Upon the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result commencement of an Asset Disposition may Offer, the Issuers shall send, or cause to be waived sent, by first class mail or modified electronically, 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:
(1) that the Asset Disposition Offer is being made pursuant to this Section 3.5 and that, to the extent lawful, all Notes properly tendered and not withdrawn shall be accepted for payment (unless prorated);
(2) the Asset Disposition payment amount, the Asset Disposition offered price, and the date on which Notes properly tendered and accepted for payment shall be purchased, which date shall be at least 10 days and not later than 60 days from the date such notice is sent (the “Asset Sale Payment Date”);
(3) that any Notes not properly tendered or accepted for payment shall continue to accrue interest in accordance with the written consent of terms thereof;
(4) that, unless the Issuers default in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrue interest on and after the Asset Sale Payment Date;
(5) that Holders of a majority in aggregate principal amount of the then outstanding Notes.electing to have any Notes purchased pursuant to any Asset Disposition Offer shall be required to surrender the
Appears in 1 contract
Sources: Indenture (Restaurant Brands International Limited Partnership)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
(1i) the The Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value, as determined in good faith by the Company (including as to the value (such fair market value to be determined on the date of contractually agreeing to such Asset Disposition) all non-cash consideration), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), and at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Dispositionthereof received, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received ), by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (a “Foreign Disposition”) is (x) prohibited 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 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 for aggregate consideration of less than $100.0 million, only 50% of the United States, the portion of such Net Available Cash so affected will not consideration therefor must be required to be applied in compliance with this Section 3.5, and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 form of cash or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5Equivalents; and
(ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cashprovided further that:
(1A) the assumption by the transferee of Indebtedness or other liabilitiesany promissory notes, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes securities or other obligations or amounts received by the Company or any such Restricted Subsidiary of the Company from the such transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents within 360 days of the receipt thereof (to the extent of the cash or Cash Equivalents received) shall be deemed to be cash solely for purposes of this Section 10.16(a)(i), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4B) any Designated Non-Cash cash Consideration received by the Company or any of its Restricted Subsidiary Subsidiaries in such Asset Dispositions Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash cash Consideration received pursuant to this Section 3.5 10.16(a)(i)(B) that is at that time outstanding, not to exceed the greater of (ax) $100.0 150.0 million and (by) 7.54.0% of LTM EBITDA Consolidated Tangible Assets at the time of receipt of such Designated Non-cash Consideration (with the fair market value Fair Market Value of each 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);
(ii) 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), 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 Asset Disposition, or (z) a combination of the foregoing purposes within such 365-day period;
(B) to make a pro rata offer to purchase Notes at par (and, to the extent required by the instrument governing such Indebtedness, any 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 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.
(eb) 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, as may be provided for by the terms of such Senior Indebtedness or Indebtedness of any non-Guarantor Subsidiary, as applicable) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture 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 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 $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 the manner, at the times and otherwise in 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 offer by the Company for Notes, the amount of Net Available Cash related to such Asset Disposition shall be reset to zero, and during the pendency of an offer by the Company for Notes 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.
(c) The Company will comply shall comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 10.16. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 10.16, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture Section 10.16(c) by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Terex Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall notwill not consummate, and shall will not permit any of its Restricted Subsidiaries toSubsidiary to consummate, make directly or indirectly, any Asset Disposition unless:: (i) the Company 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 any non-cash consideration), as determined in good faith by the Board of Directors, of the shares and assets subject to such Asset Disposition and at least 85% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or Temporary Cash Investments; (ii) 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):
(1A) first, to the extent the Company or such Restricted Subsidiary elects either (x) to acquire Additional Assets or (y) to prepay, repay, redeem or purchase Senior Indebtedness of the Company or such Restricted Subsidiary, as the case may be, receives consideration be (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition at least equal than in either case Indebtedness owed to the fair market value (such fair market value to be determined on the date of contractually agreeing to such Asset Disposition) of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiaryan Affiliate of the Company), as the in each case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 180 days from the later of (A) 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), for the Company to make an offer to the Holders of the Notes to purchase Notes pursuant to and subject to this Section (an "ASSET DISPOSITION PURCHASE OFFER"); and
(C) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A) and (B), to any application not prohibited by this Indenture; and (iii) at the receipt time of the such Asset Disposition no Default shall have occurred and be continuing (or would result therefrom). Pending application of Net Available Cash from pursuant to this Section, such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to shall be invested in Temporary Cash Investments. For the extent purposes of this Section, the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) following are deemed to be reduced in an amount equal to cash: (x) the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other assumption of Indebtedness (other than Junior Subordinated IndebtednessObligations) of the Company or any Restricted Subsidiary; provided that if , and the release of the Company or such Subsidiary from all liability on such Indebtedness, in connection with such Asset Disposition and (y) securities received by the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than from the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary transferee that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received are promptly converted by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available such Subsidiary into cash or Temporary Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); orInvestments.
(iiib) any combination In the event of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash attributable to any given an Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant requires an Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject to the limitations with respect to Foreign Dispositions set forth belowDisposition Purchase Offer, the Company shall make an be required to purchase Notes tendered pursuant to such offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes and, if required by the terms Company for the Notes at a purchase price 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 their principal amount thereof (or accreted value thereof, if less), the "ASSET DISPOSITION PURCHASE PRICE") plus accrued and but 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, interest in accordance with the procedures set forth in this Indenture and Section. If the agreement governing aggregate purchase price of Notes tendered pursuant to such offer is less than the Pari Passu IndebtednessNet Available Cash allotted to the purchase thereof (the "ASSET DISPOSITION OFFER AMOUNT"), as applicable, the Company will be permitted to apply the remaining Net Available Cash in minimum denominations accordance with clause (ii)(C) of $2,000 and in integral multiples of $1,000 in excess thereofparagraph (a) above. Notices of The Company shall not be required to make such an Asset Disposition Purchase Offer if the Asset Disposition Offer Amount is less than $1,000,000 (which lesser amount shall be sent carried forward for purposes of determining whether such an offer is required with respect to any subsequent Asset Disposition).
(c) Within 10 days after the expiration of the 180 day period referred to in clause (ii)(B) of paragraph (a) above, if the Company is required to make an Asset Disposition Purchase Offer, the Company shall send, by first class mail or sent electronicallymail, at least 10 days but not more than 60 days before the purchase date a notice to each Holder of the Notes at such Holder’s registered address or otherwise in accordance with the applicable procedures of DTCHolders, with a copy to the Trustee. The Company may satisfy the foregoing obligation with respect to the Net Available Cash by making Trustee (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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion"ASSET DISPOSITION PURCHASE NOTICE"), the Company shall allocate the Excess Proceeds among the Notes containing all instructions and Pari Passu Indebtedness materials necessary to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and enable such Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) Holders to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of tender Notes pursuant to an the Asset Disposition Offer or Advance Purchase Offer. Each Asset Disposition Purchase Notice, which shall govern the terms of the Asset Disposition Purchase Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.state:
Appears in 1 contract
Sources: Indenture (Mego Mortgage Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
(1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value, as determined in good faith by the Board of Directors (including as to the value (such fair market value to be determined on the date of contractually agreeing to such Asset Disposition) all non-cash consideration), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), and at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalents; , and
(3ii) the Company (x) within 18 months from 180 days (in the later case of (A) below) or 360 days (in the date case of such Asset Disposition and (B) the below) after receipt of the such Net Available Cash from such Asset Disposition Cash, (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(iA) to the extent the Company or any Restricted Subsidiary, as the case may be, so elects (or is so required by the terms of any IndebtednessSenior Debt), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 applies an amount equal to 100% of the Net Available Cash to repay, prepay, redeem or purchase Senior Debt of the Company or Debt (other than any Disqualified Stock) of a Wholly Owned Subsidiary (in each case other than Debt owed to the Company or an Affiliate of the Company) or (B) invests or commits to invest the balance of such Net Available Cash not applied pursuant to clause (A), in Additional Assets; provided, however, that in the case of any commitment to invest such investment must be made within one month thereafter, and any amount not so invested shall be treated as Excess Proceeds (as defined below); and (y) applies the balance of such Net Available Cash not applied pursuant to clause (x), as provided in the following paragraphs of this covenant. Notwithstanding the foregoing provisions of this paragraph, the Company and its Subsidiaries shall not be required to apply any Net Available Cash in accordance with this paragraph except to the extent that the aggregate Net Available Cash from all Asset Dispositions which are not applied in accordance with this paragraph exceeds $10 million. The amount of Net Available Cash required to be applied and not applied as so required shall constitute "Excess Proceeds". Pending application of Net Available Cash pursuant to this covenant, such Net Available Cash shall be invested in Temporary Cash Investments or applied to repay Debt Incurred under the Revolving Credit Facility without commitment reduction thereunder. For the purposes of this covenant, the following are deemed to be cash equivalents: (x) the assumption of Debt of the Company or any Subsidiary and the release of the Company or such Subsidiary from all liability on such Debt in connection with such Asset Disposition, (y) Temporary Cash Investments, and (z) securities received by the Company or any Subsidiary from the transferee that are promptly converted by the Company or such Subsidiary into cash.
(b) If, as of the first day of any calendar month, the aggregate amount of Excess Proceeds not theretofore subject to an Excess Proceeds Offer (as defined below) totals at least $10 million, the Company must, not later than the fifteenth Business Day of such month, make an offer (an "Excess Proceeds Offer") to purchase from the Holders (and to purchase Debt from the holders of any other Senior Subordinated Debt) on a pro rata basis an aggregate principal amount thereof of Notes equal to the Excess Proceeds (or accreted value thereofrounded down to the nearest multiple of $1,000) on such date, at a purchase price equal to 100% of the principal amount of such Notes, plus, in each case, accrued interest (if less)any) to the date of purchase (or, plus accrued and unpaid interestin respect of such other Senior Subordinated Debt, if any (or such lesser price with respect to Pari Passu Indebtednessprice, if any, as may be provided for 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 by making an Asset Disposition Offer prior to the expiration of the Proceeds Application Period Senior Subordinated Debt) (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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance PortionPayment"), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding The Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositioncomply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereofSection 5.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Goss Graphic Systems Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset DispositionDisposition , or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (a) to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase any Indebtedness of a Non-Guarantor Subsidiary (in each case, other than Indebtedness owed to the Company or a Guarantor any Restricted Subsidiary) or any Secured Indebtedness, including Indebtedness under the Credit Agreement (and or any Refinancing Indebtedness in the case of revolving obligations, to correspondingly reduce commitments with respect theretothereof); provided that provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiii) Obligations under to prepay, repay or purchase Pari Passu Indebtedness; provided further that, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) of extent the Company redeems, repays or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior repurchases such Indebtedness other than the Notespursuant to this clause (ii), the Company will either (1) shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 5.7 through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 75 million (such amount of Net Available Cash that are less than or equal to $60.0 75 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 75 million, “Excess Proceeds”), then, 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 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 50.0 million and (b) 7.515.0% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Owens & Minor Inc/Va/)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), with a purchase price in excess of the greater of $1,550.0 million and 30.0% of LTM EBITDA, at least 7575.0% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 or as otherwise set forth in clause (b) below, the “Proceeds Application Period”), an amount equal to the Applicable Percentage of such Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects Subsidiary elects:
(or is required by the terms of any Indebtedness), to repay A) (i) Obligations to reduce, prepay, repay or purchase any Secured Indebtedness (other than Indebtedness owed to the Company or any Restricted Subsidiary), including Indebtedness under a Debt Facility the Credit Agreement (or any Refinancing Indebtedness in respect thereof), (ii) to reduce, prepay, repay or purchase Pari Passu Indebtedness that is not otherwise Secured Indebtedness; provided, that, to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or any Restricted Subsidiary elects to reduce, prepay, repay or purchase Pari Passu Indebtedness (other than the Notes) pursuant to this clause (ii), the Company or any Restricted Subsidiary shall equally and ratably make an offer to purchase Notes (in accordance with the procedures set forth below for an Asset Disposition Offer), redeem Notes pursuant to Section 5.6 hereof or purchase Notes by any means other than a redemption, including, without limitation, in negotiated transactions, open market purchases, by tender offer or any other transactions with one or more Holders and/or beneficial owners of Notes, (iii) to make an offer to purchase Notes (in accordance with the procedures set forth below for an Asset Disposition Offer), redeem Notes pursuant to Section 5.6 hereof or purchase Notes by any means other than a redemption, including, without limitation, in negotiated transactions, open market purchases, by tender offer or any other transactions with one or more Holders and/or beneficial owners of Notes, or (iv) to reduce, prepay, repay or purchase any Indebtedness of a Non-Guarantor (including, for the avoidance of doubt, any Existing SPV and Future SPV that is a Non-Guarantor) (in each case, other than Indebtedness owed to the case of revolving obligations, to correspondingly reduce commitments with respect theretoCompany or any Restricted Subsidiary); provided that provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or ;
(B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offeri) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased invest (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (ivincluding capital expenditures) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal Subsidiary); or (ii) to invest (including capital expenditures) in any one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event that any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Company or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; provided further that if any Second Commitment is later cancelled or terminated for any reason before any Net Available Cash is applied, then the Net Available Cash shall constitute Excess Proceeds or Declined Excess Proceeds, as applicable; or
(iiiC) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iiB) above with respect to such Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of $60.0 150.0 million and 3.0% of LTM EBITDA (such amount of Net Available Cash Applicable Proceeds that are less than or equal to the greater of $60.0 million150.0 million and 3.0% of LTM EBITDA, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 million150.0 million and 3.0% of LTM EBITDA, “Excess Proceeds”), then, 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 10 Business Days 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 100100.0% of the principal amount thereof (or in the event such other Indebtedness was issued with original issue discount, 100.0% of the accreted value thereof, if less), 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 Applicable Proceeds 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 such Applicable Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero. To the extent that any portion of Net Available Cash or Applicable Percentage thereof payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(cd) Notwithstanding any other provisions of this Section 3.5,
(i1) to the extent that any of or all the Net Available Cash or Applicable Percentage of any Asset Disposition is received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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 impediments, in each case, from being repatriated to the United States, the portion of such Net Available Cash so affected will not be required to be applied in compliance with this Section 3.5covenant, and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulationlaw, applicable organizational documents impediments or other impediments 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 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 reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
(ii2) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which which, for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment out of such Net Available Cash whereby doing so the Company, any Restricted Subsidiaryof its Subsidiaries, any Parent Entity or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax), the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder)Subsidiary. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(de) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise otherwise, of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and or the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 clause that is at that time outstanding, not to exceed the greater of (a) $100.0 1,550.0 million and (b) 7.530.0% of LTM EBITDA (EBITDA, 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).
(ef) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereofof compliance therewith.
(fg) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding outstanding.
(h) The Credit Agreement may prohibit or limit, and future credit agreements or other agreements to which the Company becomes a party may prohibit or limit, the Company from purchasing any Notes pursuant to this Section 3.5. In the event the Company is prohibited from purchasing the Notes., the Company could seek the consent of its lenders to the purchase of the Notes or could attempt to refinance the borrowings that contain such prohib
Appears in 1 contract
Sources: Indenture (CoreWeave, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company Issuers shall not, and the Issuers shall not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
(1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition at least equal to the fair market value Fair Market Value (such fair market value Fair Market Value to be determined on the date of contractually agreeing to such Asset Disposition) ), as determined in good faith by the Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), with a purchase price in excess of the greater of (i) $14 million and (ii) an amount equal to 10% of LTM EBITDA, at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 450 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company Issuer or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay elects:
(i) Obligations under a Debt Facility (A) to the extent such Applicable Proceeds are from an Asset Disposition of Collateral, (x) to reduce, prepay, repay or purchase any Super-Priority Indebtedness or Other ▇▇▇▇ ▇▇▇▇ Obligations were Incurred or (y) to make an offer (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer or Asset Disposition Offer), redeem Notes as described under Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions (in each case, other than Indebtedness owed to the Issuer or any Restricted Subsidiary); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (1) of i), the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Issuer or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than obligations in respect of any such Indebtedness under any asset-backed revolving credit facility (including Indebtedness under the Credit Agreement or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)) with a purchase price in excess of the greater of $440.0 million and 1.50% of Total Assets, other than in a sale of the Budget Truck Division for fair market value, at least 75% of the consideration from such Asset Disposition (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) ), received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from an amount equal to the later of (A) the date of such Asset Disposition and (B) the receipt Applicable Percentage of the Net Available Cash (the “Applicable Proceeds”) from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(iA) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay or purchase any Indebtedness of a Non-Guarantor, any Indebtedness that is secured by a Lien (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company any Restricted Subsidiary) or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility the Credit Agreement (or any Refinancing Indebtedness in respect thereof) to within 545 days from the extent later of (A) the assets sold or otherwise disposed date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that, in connection with such Asset Disposition constituted “borrowing base assets”any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or Restricted Subsidiary shall retire such Indebtedness and will shall cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchasedpurchased or (ii) to prepay, repay or purchase Pari Passu Indebtedness at a price of no more than 100% of the principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest, if any, to, but not including, the date of such prepayment, repayment or purchase; (iii) Obligations under provided, further, that, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) of extent the Company or any Restricted Subsidiary; provided that if the Company or any a Restricted Subsidiary shall so repay any senior redeems, repays or repurchases Pari Passu Indebtedness other than the Notespursuant to this clause (ii), the Company will either (1) shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 5.7 through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and/or
(iiB) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash Applicable Proceeds received by the Company or another Restricted Subsidiary)) within 545 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Applicable Proceeds; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoingcommitment; provided that that, (1) pending the final application of the amount of any such Net Available Cash pursuant to this Applicable Proceeds in accordance with clause (A) or (B) of Section 3.53.5(a)(3), the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit FacilitiesFacility) or otherwise apply use such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iiSection 3.5(a)(3)(B) above with respect to such Asset Disposition. If.
(b) On the 546th day after the later of an Asset Disposition or the receipt of such Applicable Proceeds, with respect to any Asset Disposition, at if the expiration aggregate amount of Excess Proceeds under this Indenture exceeds (i) the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess greater of $60.0 220.0 million and 0.75% of Total Assets, in the case of a single transaction or a series of related transactions, or (ii) the greater of $440.0 million and 1.50% of Total Assets aggregate amount in any fiscal year, (such amount of Net Available Cash Applicable Proceeds that are less than do not exceed (i) the greater of $220.0 million and 0.75% of Total Assets, in the case of a single transaction or equal to a series of related transactions, or (ii) the greater of $60.0 million440.0 million and 1.50% of Total Assets aggregate amount in any fiscal year, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess do exceed (i) the greater of $60.0 million220.0 million and 0.75% of Total Assets, in the case of a single transaction or a series of related transactions, or (ii) the greater of $440.0 million and 1.50% of Total Assets aggregate amount in any fiscal year, “Excess Proceeds”), then, subject to the limitations with respect to Foreign Dispositions set forth below, the Company shall within 10 Business Days be required to make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes issued under this Indenture and, if required by to the terms of any Pari Passu Indebtednessextent the Company elects, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, in the case of the Notes, in cash price in an amount equal to 100% of the principal amount thereof (or in the event such other Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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), in each case, plus accrued and unpaid interest, if any, to, but not including, the date fixed for the closing of such offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and, with respect to the Notes, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices The Company shall deliver notice of an such Asset Disposition Offer shall be sent by first class mail or sent electronicallyelectronically or, at least 10 days but not more than 60 days before the purchase date Company’s option, by first-class mail, with a copy to the Trustee, to each Holder of Notes at the address of such Holder appearing in the Notes at such Holder’s registered address Register or otherwise in accordance with the applicable procedures of DTC, with a copy describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date will be no earlier than 10 days and no later than 60 days from the date such notice is delivered, pursuant to the Trusteeprocedures required by this Indenture and described in such notice. The Company may satisfy the foregoing obligation obligations with respect to the Net Available Cash any Applicable Proceeds from an Asset Disposition by making an Asset Disposition Offer with respect to all Applicable Proceeds prior to the expiration of the Proceeds Application Period relevant 545 days (the “Advance Offer”or such longer period provided above) or 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 Indentureany unapplied Excess Proceeds.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, and if applicable, any other Pari Passu Indebtedness so validly tendered or otherwise surrendered and not properly withdrawn 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) in Declined Excess Proceeds, Proceeds and use such Declined Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount (or accreted value, as applicable) of the Notes orsurrendered in any Asset Disposition Offer by Holders and, if applicable, other Pari Passu Indebtedness validly tendered pursuant to any Asset Disposition Offer surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (orProceeds, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero. Additionally, the Company may, at its option, make an Asset Disposition Offer using proceeds from any Asset Disposition at any time after the consummation of such Asset Disposition. Upon consummation or expiration of any Asset Disposition Offer, any Net Available Cash shall not be deemed Excess Proceeds, and the Company may use such Net Available Cash for any purpose not otherwise prohibited by this Indenture.
(cd) To the extent that any portion of Net Available Cash or Applicable Proceeds payable in respect of the Notes is denominated in a currency other than U.S. Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in U.S. Dollars that is actually received by the Company upon converting such portion into U.S. Dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash or Applicable Proceeds of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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 impediments, in each case, from being repatriated to the United States, the portion of such Net Available Cash or Applicable Proceeds 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulationlaw, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company to within one year following the date on which the respective payment would otherwise have been required, promptly take all commercially reasonable actions reasonably required by with respect to the applicable local law or regulationlaw, applicable organizational documents impediments or other impediments impediment to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required required, such repatriation of any of such affected Net Available Cash or Applicable Proceeds is permitted under the applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and the amount of such repatriated Net Available Cash or Applicable Proceeds will be promptly (and in any event not later than five (5) Business Days after such repatriation could be made) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash or Applicable Proceeds of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment whereby doing so the Company, any Restricted Subsidiaryof its Subsidiaries, any Parent Entity or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax tax liability, including receipt of a Tax tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Taxtax), the Net Available Cash or Applicable Proceeds so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder)Subsidiary. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section 3.5(a)(2) hereof), the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise otherwise, of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, case within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company or any Restricted Subsidiary received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 510.0 million and (b) 7.51.75% of LTM EBITDA Total Assets (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).
(eg) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) of compliance therewith. The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Avis Budget Group, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
(1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition (or conclusion of any payment schedule with respect to such Asset Disposition) at least equal to the fair market Fair Market Value (including as to the value (such fair market value to be determined on the date of contractually agreeing to such Asset Dispositionall non-cash consideration) of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);Disposition; and
(2ii) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Dispositionthereof, together with all other Asset Dispositions since the Issue Escrow Release Date (on a cumulative basis) ), received by the Company or such Restricted Subsidiary is in the form of cash or Cash Equivalents. Within 450 days after the receipt of any Net Available Cash from such Asset Disposition (or, in the case of a Designated Foreign Asset Disposition, within the time period specified in the definition thereof), the Company or the applicable Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt of shall apply the Net Available Cash from such Asset Disposition:
(A) to the extent the assets or property disposed of in the Asset Disposition constituted Collateral, to repay (as may i) Secured Notes Obligations, (ii) Senior Secured Credit Facilities Obligations or (iii) any Additional Equal Priority Obligations, and in each case, in the case of revolving obligations, to correspondingly reduce commitments with respect thereto; provided that all reductions of Secured Notes Obligations shall be extended made pursuant to Section 5 of the Securities, through open-market purchases (to the extent such purchases are at or above 100% of the principal amount thereof) or by making an Acceptable Commitment as offer (in accordance with the procedures set forth belowin Section 4.06(b)) to all Holders to purchase their Securities at 100% of the principal amount thereof, the “Proceeds Application Period”)plus accrued but unpaid interest, an amount equal if any, on such Securities;
(B) to the Net Available Cash is appliedextent the assets or property disposed of in the Asset Disposition did not constitute Collateral:
(i) to repay (x) Secured Notes Obligations, (y) Senior Secured Credit Facilities Obligations or (z) any Additional Equal Priority Obligations, and in each case, in the extent case of revolving obligations, to correspondingly reduce commitments with respect thereto; provided that if the Company Issuer or any Restricted SubsidiarySubsidiary shall repay any Obligations pursuant to clause (z) above, as the case may beIssuer or such Restricted Subsidiary will either (I) reduce the aggregate principal amount of Secured Notes Obligations on a ratable basis with any such Obligations under the Additional Equal Priority Obligations repaid pursuant to this clause (B)(i) by, elects at its option, (x) redeeming Securities pursuant to Section 5 of the Securities or is required by (y) purchasing Securities through open-market purchases or (II) make an offer (in accordance with the terms provisions set forth in Section 4.06(b)) to all Holders to purchase their Securities on a ratable basis with any Obligations under the Additional Equal Priority Obligations repaid pursuant to this clause (B)(i) for no less than 100% of the principal amount thereof plus the amount of accrued and unpaid interest, if any, thereon (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or
(ii) to repay Obligations under any IndebtednessSenior Indebtedness (other than any Senior Indebtedness referred to in clause (B)(i) above), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Issuer or such Restricted Subsidiary will retire such Indebtedness and either (other than I) reduce the aggregate principal amount of Secured Notes Obligations on an equal or ratable basis with any such Senior Indebtedness under any asset-backed credit facility repaid pursuant to this clause (or any Refinancing Indebtedness in respect thereofB)(ii) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (Ax) redeeming Notes as described under Securities pursuant to Section 5.6 5 of the Securities or (By) purchasing Notes Securities through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2II) make an offer (in accordance with the procedures provisions set forth below for an Asset Disposition Offerin Section 4.06(b) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness and for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up thereon) to the principal amount of Notes all Holders to be repurchased purchase their Securities on an equal or ratable basis with any Senior Indebtedness repaid pursuant to this clause (B)(ii) (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or ;
(ivC) to reduce the outstanding principal amount of Indebtedness of a Restricted Subsidiary that is not a Subsidiary Guarantor;
(D) to acquire Additional Assets or other assets that replace the assets subject to such Asset Disposition;
(E) to make investments and capital expenditures that are used or useful in a Related Business; or
(F) for the avoidance of doubt, any combination of the foregoing, in the case of clauses (A), (B) and (C) other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to an Affiliate of the extent the Company Company; provided that entering into and not abandoning or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that rejecting a binding agreement commitment to acquire assets or property or make investments or capital expenditures to satisfy clause (D) or (E) shall be treated as a permitted application of Net Available Cash from the date of such commitment with commitment; provided further that (x) such acquisition or capital expenditure is consummated within 545 days after the good faith expectation that an amount equal to later of the receipt of such Net Available Cash or the date of such Asset Disposition and (y) if such acquisition or capital expenditure is not consummated within the period set forth in subclause (x), the Net Available Cash not so applied will be applied deemed to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”constitute Excess Proceeds under Section 4.06(b); or
(iii) any combination of the foregoing; provided that (1) pending . Pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5Cash, the Company or the applicable such Restricted Subsidiaries Subsidiary may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) facility, if any, or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) Indenture. Notwithstanding the foregoing provisions of this Section 4.06, the Company (or and the Restricted Subsidiaries shall not be required to apply any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of accordance with this Section 4.06 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 exceeds $60.0 million 100,000,000.
(such amount of b) Any Net Available Cash that are less than is not applied or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are invested as provided in excess of $60.0 million, Section 4.06(a) shall constitute “Excess Proceeds”), then, subject to . When the limitations with respect to Foreign Dispositions set forth belowaggregate amount of Excess Proceeds exceeds $100,000,000, the Company shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes and, if required by the terms of Company or any Pari Passu IndebtednessSubsidiary Guarantor elects, to all holders of such Pari Passu Indebtedness, Equal Priority Obligations to purchase or redeem the maximum principal amount of the Securities and such Notes and Pari Passu IndebtednessEqual Priority Obligations, as appropriate, on a pro rata basisapplicable, that may be purchased out of the amount of such Excess Proceeds, if any, at an . The offer price, price in the case of the Notes, in cash in an amount any Asset Disposition Offer shall be equal to 100% of the principal amount thereof (of the Securities or accreted value thereof, if less), any such Equal Priority Obligations plus accrued and unpaid interest, if any (or such lesser price with respect interest 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 offerpurchase, and shall be payable in cash in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtednessapplicable Equal Priority Obligations. If the aggregate purchase price of Indebtedness tendered exceeds the amount of Excess Proceeds, as applicablethe Trustee shall select the Indebtedness to be purchased on a pro rata basis but in round denominations, which, in minimum the case of the Securities, shall be denominations of $2,000 and in principal amount or 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any each Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) zero and, so long as all such Securities validly tendered and not withdrawn pursuant to such offer are purchased by the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash so affected will not be required to be applied in compliance with this Section 3.54.06, any excess of the offer amount over the amount applied to purchase such Securities (and such amounts other Equal Priority Obligations) pursuant to such offer may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or for any Restricted Subsidiary of the purpose not prohibited by this Indenture. The Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositionshall comply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 4.06. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 4.06, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described under this Section 4.06 by virtue of its compliance with such securities laws or regulations. Nothing in this Indenture by virtue thereofshall prevent the Company from making an Asset Disposition Offer earlier than required.
(fc) (i) Promptly, and in any event within 10 days after the Company becomes obligated to make an Asset Disposition Offer, the Company shall be obligated to deliver to the Trustee and deliver electronically, in accordance with DTC procedures in the case of Global Securities, or send by first-class mail, to each Holder, a written notice stating that the Holder may elect to have their Securities purchased by the Company either in whole or in part (subject to prorating as described in 4.06(b) in the event the Asset Disposition Offer is oversubscribed) in integral multiples of $2,000 of principal amount or any whole integral multiple of $1,000 in excess thereof, at the applicable purchase price. The provisions notice shall specify a purchase date not less than 30 days nor more than 60 days after the date of this Indenture relative such notice (the “Purchase Date”) and shall contain such information concerning the business of the Company which the Company in good faith believes shall enable such Holders to make an informed decision (which at a minimum shall 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 obligation business subsequent to make an offer the date of the latest of such reports, and (C) if material, appropriate pro forma financial information) and all instructions and materials necessary to repurchase tender Securities pursuant to the Notes as a result of an Asset Disposition may be waived or modified Offer, together with the written consent of the Holders of a majority address referred to in aggregate principal amount of the then outstanding Notesclause (iii) below.
Appears in 1 contract
Sources: Indenture (NCR Atleos, LLC)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Board of Directors of the Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt 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 extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is appliedbe:
(iA) to the extent the Company Issuer or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under to prepay, repay or purchase any Indebtedness of a Debt Facility Non-Guarantor or that is secured by a Lien (in each case, other than Indebtedness owed to the extent such Obligations were Incurred under clause (1Issuer or any Restricted Subsidiary) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility the Credit Agreements (or any Refinancing Indebtedness in respect thereof) to within 365 days from the extent later of (A) the assets sold or otherwise disposed date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that, in connection with such Asset Disposition constituted “borrowing base assets”any prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Issuer or such Restricted Subsidiary shall retire such Indebtedness and will shall cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiii) Obligations under the Notes to prepay, repay or any other purchase Pari Passu Indebtedness (other at a price of no more than Subordinated Indebtedness) 100% of the Company principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest to the date of such prepayment, repayment or any Restricted Subsidiarypurchase; provided that if further that, to the Company extent the Issuer redeem, repay or any Restricted Subsidiary shall so repay any senior repurchase Pari Passu Indebtedness other than the Notespursuant to this clause (ii), the Company will either (1) Issuer shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 3.07 hereof through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;or
(iiB) to the extent the Company Issuer or any such Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company Issuer or another Restricted Subsidiary)) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement or a commitment approved by the Board of Directors of the Issuer that is executed or approved within such time shall be treated satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment investment is consummated within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing365th day; provided that (1) that, pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5in accordance with clause (a) or clause (b) above, the Company or the applicable Issuer and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture and Indenture.
(2b) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Any Net Available Cash attributable from Asset Dispositions that is not applied or invested or committed to any given Asset Disposition (be applied or invested as provided that such investment in Section 4.10(a) shall be made no earlier than deemed to constitute “Excess Proceeds” under this Indenture. On the earliest of written notice to the Trustee of the relevant 366th day after an Asset Disposition, execution of a definitive agreement for if 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such aggregate amount of Net Available Cash that are less than or equal to Excess Proceeds under this Indenture exceeds $60.0 25.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject the Issuer shall within 30 Business Days be required to the limitations with respect to Foreign Dispositions set forth below, the Company shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes issued under such indenture and, if required by to the terms of any Pari Passu Indebtednessextent the Issuer elects, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, price in the case respect of the Notes, in cash Notes in an amount equal to 100% of the principal amount thereof (or accreted value thereofof the Notes and Pari Passu Indebtedness, if less)in each case, 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 offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and, with respect to the Notes, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices The Issuer shall deliver notice of an such Asset Disposition Offer shall be sent electronically or by first 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 DTCmail, with a copy to the Trustee. The Company may satisfy , to each Holder of Notes at the foregoing obligation address of such Holder appearing in the security register or otherwise in accordance with respect the procedures of DTC, describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date shall be no earlier than 30 days and no later than 60 days from the date such notice is delivered, pursuant to the Net Available Cash 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 procedures required to do so by this IndentureIndenture and described in such notice.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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) in Declined Excess Proceeds, and the Issuer may use such Declined any remaining Excess Proceeds for any purpose not 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 surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (orProceeds, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will shall be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(cd) Notwithstanding any other provisions of this Section 3.5,
(i) to To the extent that any portion of or all the Net Available Cash payable in respect of any Asset Disposition by the Notes is denominated in a Foreign Subsidiary or a CFC Holding Company (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 currency other onerous organizational or administrative impediments from being repatriated to the United Statesthan U.S. dollars, the portion amount thereof payable in respect of such Net Available Cash so affected will the Notes shall not be required to be applied exceed the net amount of funds in compliance with this Section 3.5, and such amounts may be retained U.S. dollars that is actually received by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments to permit Issuer upon converting 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Defaultportion into U.S. dollars.
(de) For the purposes of Section 3.5(a)(2) hereof4.10(a)(2), the following will shall be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise liabilities of the Company Issuer or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company Issuer or a Guarantor) and the release of the Company Issuer or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company Issuer or any Restricted Subsidiary of the Company Issuer from the transferee that are converted by the Company Issuer or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Issuer and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Issuer (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Issuer or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company Issuer or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 4.10 that is at that time outstanding, not to exceed the greater of (a) $100.0 20.0 million and (b) 7.52.0% of LTM EBITDA Total Assets (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).
(ef) The Company will comply Issuer shall comply, to the extent applicable, with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those such laws and or regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 4.10. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this Indenture, the Company will Issuer shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Borrower will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Borrower or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 an Officer or the Board of Directors of the Borrower, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);; and
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition or such series of related Asset Dispositions (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, other than Indebtedness), together with all other Asset Dispositions since the Issue Closing Date (on a cumulative basis) received by the Company Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash Equivalents; andInvestments.
(3b) After the receipt of Net Available Cash from an Asset Disposition, the Borrower or a Restricted Subsidiary, as the case may be, may apply such Net Available Cash directly or indirectly (at the option of the Borrower or such Restricted Subsidiary):
(1) within 18 months 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company prepay, repay, purchase or redeem any Restricted SubsidiaryIndebtedness incurred under Section 4.04(b)(1); provided, as the case may behowever, elects (that, in connection with any prepayment, repayment or is required by the terms purchase of any IndebtednessIndebtedness pursuant to this Section 4.08(b)(1), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Borrower or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of any revolving Indebtedness) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchasedredeemed; (iiiii) Obligations under unless included in Section 4.08(b)(1)(i), to prepay, repay, purchase or redeem any Pari Passu Indebtedness of the Notes Borrower or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis byGuarantor, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for price of no less more than 100% of the principal amount thereof, of such Pari Passu Indebtedness plus the amount of accrued but and unpaid interest, if any, thereon up interest to the principal amount date of Notes such prepayment, repayment, purchase or redemption, provided that the Borrower or such Guarantor, as applicable, shall prepay, redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to be repurchased this clause (which offer shall be deemed ii) only if the Borrower delivers a notice of prepayment with respect to be an Asset Disposition Offer for purposes hereofthe Pari Ratable Share of the Term Loans in accordance with Section 2.13(a)(ii) within the time period specified by this Section 4.08(b)(1) and thereafter complies with its obligations under Section 2.13(a)(iii); (iii) to prepay, repay, purchase or (iv) redeem any Indebtedness of a Restricted Subsidiary that is not a GuarantorGuarantor or any Indebtedness that is secured on assets which do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Borrower or a Guarantor or Indebtedness owed to the Company Borrower or another any Restricted Subsidiary); or (iv) to prepay the Loans in full pursuant to Section 2.12;
(ii2) to the extent the Company Borrower or any such Restricted Subsidiary elects, to invest in or purchase or commit to invest in or purchase Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company Borrower or another Restricted Subsidiary)) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such investment or commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment invest is consummated within 180 days of such 365th day;
(3) to make a capital expenditure within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that any such capital expenditure made pursuant to a definitive binding agreement or a commitment (an “Acceptable Commitment”)approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as such investment is consummated within 180 days of such 365th day; or
(iii4) any combination of the foregoing; provided that clauses (1) – (3) of Section 4.08(b) above, provided that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clauses (1), (2), (3) or (4) of Section 3.54.08(b), the Company or Borrower and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zeroAgreement.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof4.08(a)(2), the following will be deemed to be cash:
(1) the assumption by the transferee (or other extinguishment in connection with the transactions relating to such Asset Dispositions) of Indebtedness or and any other liabilities, contingent or otherwise liabilities (as recorded on the balance sheet of the Company Borrower or a any Restricted Subsidiary 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 Borrower’s or such Restricted Subsidiary’s balance sheet or in the footnotes thereof 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 Borrower) of the Borrower or any Restricted Subsidiary (other than Subordinated Indebtedness of the Company Borrower or a Guarantor) and the release of the Company Borrower or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company Borrower or any Restricted Subsidiary of the Company from the transferee that are converted by the Company Borrower or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Borrower and each other Restricted Subsidiary (as applicable) are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Borrower or a Guarantor (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Borrower or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company Borrower or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 4.08 that is at that time outstanding, not to exceed the greater of (a) $100.0 110 million and (b) 7.55% of LTM L2QA Pro Forma EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Credit Agreement (CSC Holdings LLC)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition in excess of the greater of $25.0 million and 8.0% of LTM EBITDA, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth defined below, the “Proceeds Application Period”), an amount equal to the Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects elects:
(i) (A) to reduce, prepay, repay or purchase any Secured Pari Passu Indebtedness, including the Notes, the Existing Senior Secured Notes and the Indebtedness under the Credit Agreement (or is required by any Refinancing Indebtedness in respect thereof), (B) to reduce, prepay, repay or purchase any other Secured Indebtedness other than Secured Pari Passu Indebtedness so long as the terms of proceeds are with respect to assets securing such Secured Indebtedness and not constituting Collateral; (C) to reduce, prepay, repay or purchase any Indebtednessother Secured Indebtedness or Pari Passu Indebtedness so long as the proceeds are with respect to assets not constituting Collateral and so long as the Company ratably repays the Notes, (D) to make an offer in accordance with the procedures set forth below for an Asset Disposition Offer (whether or not accepted), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph redeem Notes as described under Section 3.2 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (and in the case of revolving obligationsE) to reduce, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured prepay, repay or purchase any Indebtedness of a Non-Guarantor (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretoany Restricted Subsidiary); provided that provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, (A) 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 equal Subsidiary); or (B) to invest (including capital expenditures) in any one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days 6 months of such commitment (an “Acceptable Commitment”); provided, further, that if any Acceptable Commitment is later canceled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Excess Proceeds; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company (or any Restricted Subsidiary, as the case may be) , may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of $60.0 50.0 million and 15.0% of LTM EBITDA (such amount of Net Available Cash Applicable Proceeds that are less than or equal to the greater of $60.0 million50.0 million and 15.0% of LTM EBITDA, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 million50.0 million and 15.0% of LTM EBITDA, “Excess Proceeds”), then, 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 10 Business Days ten business days after the expiration of the Proceeds Application Period to all Holders of Notes and, if required by the terms of any Secured Pari Passu Indebtedness, to all holders of such Secured Pari Passu Indebtedness or, so long as the Excess Proceeds are with respect to assets not constituting Collateral, other Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as appropriateapplicable, 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), plus accrued and unpaid interest, if any (or such lesser price with respect to such Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, 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 such Secured Pari Passu Indebtedness or 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 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 address, with a copy to the Trustee, 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 Applicable Proceeds 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 Applicable Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, validly tendered pursuant to any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable; provided that no Notes or other Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero.
(cd) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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 impediments, in each case, from being repatriated to the United States, an amount equal to the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required required, such repatriation of any of such affected Net Available Cash is permitted under the applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and an amount equal to such repatriated Net Available Cash will be promptly (and in any event not later than five (5) Business Days after such repatriation could be made) applied (net of additional Taxes payable or reserved against as a result thereof, to the extent not already taken into account in the definition of “Net Available Cash”) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would could have an a non-de minimis adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so as determined by the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax), the Net Available Cash so affected may will not be retained by required to be applied in compliance with this Section 3.5 so long, but only so long, as the non-de minimis Tax consequence could result from the repatriation, or an obligation to repatriate, to the 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 or CFC Holding Companyregulation, applicable organizational documents or other impediments 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 no longer has a non-de minimis Tax consequence, the amount of such 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 Taxes payable or reserved against as a result thereof, to the extent not already taken into account in the definition of “Net Available Cash”) (whether or not repatriation actually occurs) in compliance with this Section 3.5. For the avoidance of doubt, nothing in this covenant Section 3.5 shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section 3.5(a)(2) hereof), the following will shall be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise otherwise, of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and or the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) (4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) (5) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 50.0 million and (b) 7.515.0% of LTM EBITDA (EBITDA, 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).
(eg) The Company will comply with Upon the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result commencement of an Asset Disposition may Offer, the Company shall send, or cause to be waived sent, by first class mail or modified with electronically, a notice to the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.Trustee and to each Holder at its registered address. The notice shall contain all instructions and materials nece
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
(1) unless the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value (such fair market including as to the value to be of all non-cash consideration), as determined on in good faith by the date Board of contractually agreeing to such Asset Disposition) Directors, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), and at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) therefor received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalents; and
cash equivalents. With respect to any Asset Disposition occurring on or after the Issue Date from which the Company or any Restricted Subsidiary receives Net Available Cash, the Company or such Restricted Subsidiary shall: (3i) within 18 months from the later of (A) 360 days after the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) received and to the extent the Company or any such Restricted Subsidiary, as the case may be, Subsidiary elects (or is required by the terms of any Senior Indebtedness)) to (A) apply an amount equal to such Net Available Cash to prepay, to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase Senior Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (Subsidiary, in each case owing to a Person other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if Affiliate of the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the NotesCompany, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases invest an equal amount, or in arm’s-length privately negotiated transactions the amount not so applied pursuant to clause (which, in each case, may be below parA), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment Investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company or another Restricted Subsidiary) and (ii) apply such excess Net Available Cash (to the extent not applied pursuant to clause (i)) as provided in the following paragraphs of this Section 4.6; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 or otherwise surrendered in connection with an Asset Disposition Offer made with Excess Proceeds (orany prepayment, in the case repayment or purchase 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Pari Passu Senior Indebtedness validly tendered pursuant to any Asset Disposition Offer exceeds the amount of Excess Proceeds clause (orA) above, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on shall retire such Senior Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.cause the
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a1) The Company shall Borrower will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition in excess of the Asset Disposition Threshold Amount unless:
(1a) the Company Borrower or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition at least equal to the fair market value Fair Market Value (such fair market value Fair Market Value to be determined on the date of contractually agreeing to such Asset Disposition) of the shares and assets subject to such Asset Disposition Disposition; and
(including, for the avoidance of doubt, if b) with respect to (x) any such individual Asset Disposition is transaction with respect to assets having a Permitted Asset Swap);
Fair Market Value in excess of US$5,000,000 or (2y) in any such Asset DispositionDispositions transactions with respect to assets having a Fair Market Value in excess of US$10,000,000, or series for all such transactions on an aggregate basis in any Fiscal Year, in each case of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swapx) and (y), at least 75% of the consideration from such Asset Dispositions (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from received by the Borrower or such Asset Disposition, together with all other Asset Dispositions Restricted Subsidiary pursuant to this clause (b) since the Issue Closing Date (on a cumulative basis) received by the Company or such Restricted Subsidiary), as the case may be, is in the form of cash or Cash EquivalentsEquivalents (as determined in accordance with the provisions of this Section 9.8 below); and
(3c) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition of the Borrower and the Subsidiary Guarantors is applied and/or reinvested as (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal and to the Net Available Cash is applied:
(iextent) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto1.1(2); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”)that, and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with Section 3.51.1(2), the Company or the applicable Borrower and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 IndentureAgreement.
(b2) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount portion of Net Available Cash and Excess Proceeds payable in respect of the Loans is denominated in a currency other than Canadian dollars, the amount thereof payable in respect of the Loans shall be reset at zeronot exceed the net amount of funds in Canadian dollars that is actually received by the Borrower upon converting such portion into Canadian dollars.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d3) For the purposes of clause (1)(b) of this Section 3.5(a)(2) hereof9.8, the following will be deemed to be cash:
(1a) the assumption by the transferee of Indebtedness or other liabilities, liabilities contingent or otherwise of the Company Borrower or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company Borrower or a GuarantorGuarantor or Indebtedness or liabilities incurred in contemplation of such Asset Disposition) and the release of the Company Borrower or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2a) securities, notes or other obligations received by the Company Borrower or any Restricted Subsidiary of the Company Borrower from the transferee (including earn-outs or similar obligations) that are converted by the Company Borrower or such Restricted Subsidiary into cash or Cash EquivalentsEquivalents within 180 days following the closing of such Asset Disposition, or by their terms are required to be satisfied for cash and or Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, ) within 180 days following the closing of such Asset Disposition;
(3b) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Borrower and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and;
(4c) consideration consisting of Indebtedness of the Borrower (other than Subordinated Indebtedness) received after the Closing Date from Persons who are not the Borrower or any Restricted Subsidiary;
(d) the amount of any trade-in value applied to the purchase price of any replacement assets acquired in connection with such Asset Disposition;
(e) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in respect of such Asset Dispositions Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 clause (d) and that is at that time outstanding, not to exceed the greater in excess of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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)US$15,000,000.
(e4) The Company will comply Notwithstanding any provision of this Agreement (including any permitted asset dispositions pursuant to this section or the definition of “Asset Disposition”), in no event shall a disposition or decommissioning of any assets related to the Project (including an indirect disposition of the Project pursuant to a distribution of Capital Stock of a Subsidiary of the Borrower or any other indirect disposition of the Project) be permitted in each case that could result in the Project (i) no longer operating in accordance with the requirements of Rule 14e-1 under Construction Budget and Schedule and the Exchange Act Operating Budget in all material respects and Prudent Industry Practice or (ii) being owned by any Person other applicable securities laws and regulations thereunder to than the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer Borrower or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent wholly owned Subsidiary of the Holders of a majority in aggregate principal amount of the then outstanding NotesBorrower.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
(1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition 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) of the shares and assets subject to such Asset Disposition Disposition, as such fair market value may be determined (includingand shall be determined, for to the avoidance of doubt, if extent such Asset Disposition is a Permitted or any series of related Asset SwapDispositions involves aggregate consideration in excess of $20.0 million) in good faith by the Board of Directors, whose determination shall be conclusive (including as to the value of all non-cash consideration);,
(2ii) in the case of any such Asset Disposition, Disposition (or series of related Asset Dispositions (except to the extent the Asset Disposition is Dispositions) having a Permitted Asset Swap)fair market value of $20.0 million or more, at least 75% of the consideration therefor (including excluding, in the 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) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basisthat are not Indebtedness) received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalents; cash, and
(3iii) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company (or any Restricted Subsidiary, as the case may be) as follows:
(A) first, either (x) to the extent the Company elects (or is required by the terms of any Bank Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured any Senior Indebtedness of the Company or a any Note Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Note Guarantor), to prepay, repay or purchase any such Indebtedness (in each case other than Indebtedness owed to the Company or another a Restricted Subsidiary;
) within 365 days after the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash, or (iiy) to the extent the Company or any such Restricted Subsidiary elects, to invest in or commit to invest reinvest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company or another Restricted Subsidiary) within 365 days from the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash, or, if such reinvestment in Additional Assets is a project 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 after application in accordance with clause (A) above (such balance, the “Excess Proceeds”), to make an offer to purchase Notes and (to the extent the Company or such Restricted Subsidiary elects, or is required by the terms thereof) to purchase, redeem or repay any other Senior Indebtedness of the Company or a Restricted Subsidiary, pursuant and subject to the conditions of this Indenture and the agreements governing such other Indebtedness; 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 Indenture) any general corporate purpose (including the repurchase, repayment or other acquisition or retirement of any Subordinated Obligations); provided, however, that a binding agreement shall be treated as a permitted application in connection with any prepayment, repayment or purchase of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Indebtedness pursuant to this Section 3.5clause (A)(x) or (B) above, the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility related loan commitment (including under the Senior Credit Facilitiesif any) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 permanently reduced in an amount equal to 100% of the principal amount thereof (so prepaid, repaid or accreted value thereof, if less), plus accrued and unpaid interest, if any (or such lesser price with respect to Pari Passu Indebtedness, if any, as may be provided by purchased. Notwithstanding the terms foregoing provisions of such other Indebtedness), to, but not includingthis Section 411, the date fixed for Company and the closing of such offer, Restricted Subsidiaries shall not be required to apply any Net Available Cash 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 Section 411 except 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 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 or otherwise surrendered Net Available Cash from all Asset Dispositions that is not applied in connection accordance 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not otherwise prohibited by this IndentureSection 411 exceeds $25.0 million. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Pari Passu Indebtedness validly tendered pursuant to any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu other Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary validly tendered and not withdrawn (or otherwise subject to purchase, redemption or repayment) in connection with an offer pursuant to clause (iii) (B) above exceeds the Excess Proceeds, the Excess Proceeds will be apportioned between such Notes and such other than Subordinated Indebtedness of the Company or a GuarantorRestricted Subsidiary, with the portion of the Excess Proceeds payable in respect of such Notes to equal the lesser of (x) the Excess Proceeds amount multiplied by a fraction, the numerator of which is the outstanding principal amount of such Notes and the denominator of which is the sum of the outstanding principal amount of the Notes and the outstanding principal amount of the relevant other Indebtedness of the Company or a Restricted Subsidiary, and (y) the aggregate principal amount of Notes validly tendered and not withdrawn. For the purposes of clause (ii) of paragraph (a) above, the following are deemed to be cash: (1) Temporary Cash Investments and Cash Equivalents, (2) the assumption of Indebtedness 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 principal amount of such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, 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; and
, (4) securities 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, (5) consideration consisting of Indebtedness of the Company or any Restricted Subsidiary and (6) any Designated Non-Cash Consideration received by the Company or any of its Restricted Subsidiary Subsidiaries in such an Asset Dispositions Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstandingclause, not to exceed the greater of (a) $100.0 million and (b) 7.5an aggregate amount at any time outstanding equal to 3% of LTM EBITDA Consolidated Tangible Assets (with the fair market value Fair Market Value of each item of Designated Non-Cash Non- cash Consideration being measured at the time received and without giving effect to subsequent changes in value).
(eb) In the event of an Asset Disposition that requires the purchase of Notes pursuant to Section 411(a)(iii)(B), the Company will be required to purchase Notes tendered pursuant to an offer by the Company for the Notes (the “Offer”) at a purchase price of 100% of their principal amount plus accrued and unpaid interest to the purchase date in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture. If the aggregate purchase price of the Notes tendered pursuant to the Offer is less than the Net Available Cash allotted to the purchase of Notes, the remaining Net Available Cash will be available to the Company for use in accordance with Section 411(a)(iii)(B) (to repay other Indebtedness of the Company or a Restricted Subsidiary) or Section 411(a)(iii)(C). The Company shall not be required to make an Offer for Notes pursuant to this Section 411 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 411(a)(iii)(A)) is less than $25.0 million for any particular Asset Disposition (which lesser amounts 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).
(c) The Company shall, not later than 45 days after the Company becomes obligated to make an Offer pursuant to this Section 411, mail a notice to each Holder with a copy to the Trustee stating: (1) that an Asset Disposition that requires the purchase of a portion of the Notes has occurred and that such Holder has the right (subject to the prorating described below) to require the Company to purchase a portion of such Holder’s Notes at a purchase price in cash equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (subject to Section 307); (2) the circumstances and relevant facts and financial information regarding such Asset Disposition; (3) the repurchase 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 Company, consistent with this Section 411, that a Holder must follow in order to have its Notes purchased; and (5) the amount of the Offer. If, upon the expiration of the period for which the Offer remains open, the aggregate principal amount of Notes surrendered by Holders exceeds the amount of the Offer, 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 $2,000 or integral multiples of $1,000 in excess thereof, shall be purchased).
(d) The Company will comply comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 411. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 411, the Company will comply with the applicable securities laws, rules laws and regulations and shall will not be deemed to have breached its obligations described in under this Indenture Section 411 by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
unless (1) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value (such fair market including as to the value to be of all non-cash consideration), as determined on in good faith by the date Board of contractually agreeing to such Asset Disposition) Directors of the Company, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
Disposition; (2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents; and (3) an amount equal to 100% of the Net Available Cash from such Asset Disposition is applied by the Company (or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth belowfirst, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay, redeem or purchase Senior Indebtedness of the Company or Indebtedness (other than any Preferred Stock or Disqualified Stock) of a Guarantor Wholly Owned 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 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), 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 in to holders of other Senior Subordinated Indebtedness of the case Company designated by the Company) to purchase Securities (and such other Senior Subordinated Indebtedness of revolving obligations, the Company) pursuant to correspondingly reduce commitments with respect theretoand subject to the conditions of Section 4.06(b); provided 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 will shall permanently retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will 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; (iii) Obligations under . Notwithstanding the Notes or any other Indebtedness (other than Subordinated Indebtedness) foregoing provisions of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notesthis Section 4.06, the Company will either (1) reduce Obligations under and the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may Restricted Subsidiaries shall not be below par), or (2) make an offer (required to apply any Net Available Cash in accordance with the procedures set forth below for an Asset Disposition Offerthis Section 4.06(a) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) except to the extent that the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of aggregate Net Available Cash from the date of such commitment all Asset Dispositions which is not applied in accordance with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iiithis Section 4.06(a) any combination of the foregoing; provided that (1) pending the final exceeds $5.0 million. Pending application of the amount of any such Net Available Cash pursuant to this Section 3.54.06(a), the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Dispositionindebtedness. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of this Section 3.5(a)(2) hereof4.06(a), the following will be are deemed to be cash:
cash or cash equivalents: (1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company (other than obligations in respect of Disqualified Stock of the Company) or a any Restricted Subsidiary (other than Subordinated Indebtedness obligations in respect of the Company or Disqualified Stock and Preferred Stock of a Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
Disposition and (2) securities, notes or other obligations securities 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 or Cash Equivalentscash, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents receivedreceived in that conversion.
(b) In the event of an Asset Disposition that requires the purchase of Securities (and other Senior Subordinated Indebtedness) pursuant to Section 4.06(a)(3)(C), the Company shall purchase Securities tendered pursuant to an offer 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 each casethe event such other Senior Subordinated Indebtedness of the Company was issued with significant original issue discount, within 180 days following 100% of the closing accreted value thereof) without premium, plus accrued but unpaid interest (or, in respect of such other Senior Subordinated Indebtedness of the 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 oversubscription) set forth in Section 4.06(c). If the aggregate purchase price of Securities (and any other Senior Subordinated Indebtedness) tendered pursuant to the Offer exceeds the Net Available Cash allotted to their purchase, the Company shall select the Securities and other Senior Subordinated 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 an offer to purchase Securities (and other Senior Subordinated Indebtedness of the Company) pursuant to this Section 4.06 if the Net Available Cash available therefor is less than $5.0 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;). 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 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 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 Subordinated Indebtedness 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) and (b). 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 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 4.06. 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 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) Indebtedness 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 any Restricted Subsidiary the Holder, the principal amount of the Security which was delivered for purchase by the Holder and a statement that such Holder is no longer a Restricted Subsidiary as a result 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.
(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 Asset DispositionSecurities are to be accepted by the Company pursuant to and in accordance with the terms of this Section 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) The Company shall comply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 4.06. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 4.06, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture Section 4.06 by virtue thereofof its compliance with such securities laws or regulations.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Brand Services)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Each of Superior Energy and the Company shall will not, and shall will not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
(1) Superior Energy, the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the 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 Superior Energy, an officer of Superior Energy or an officer of such fair market value to Restricted Subsidiary with responsibility for such transaction, which determination shall be determined on the date conclusive evidence of contractually agreeing to such Asset Disposition) compliance with this provision, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap)Disposition;
(2) in any such the case of an Asset DispositionDisposition for consideration exceeding $20.0 million, or series the fair market value is determined, in good faith, by the Board of related Asset Dispositions (except Directors of Superior Energy, and evidenced by a resolution of the Board of Directors of Superior Energy set forth in an Officer’s Certificate delivered to the extent the Asset Disposition is a Permitted Asset Swap), Trustee;
(3) at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by Superior Energy, the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Temporary Cash EquivalentsInvestments; and
(34) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth belowSuperior Energy, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any such Restricted Subsidiary, as the case may be, elects within 365 days after its receipt, at its option:
(A) to repay Indebtedness and other Obligations under a Credit Facility;
(B) to acquire Additional Assets or is required by to make capital expenditures in a Related Business; and
(C) to the terms extent of any Indebtednessthe balance of such Net Available Cash after application in accordance with clauses (A) and (B), to repay (i) Obligations under a Debt Facility make an offer to the extent such Obligations were Incurred under clause (1) Holders of the second paragraph under Section 3.2 Notes (and in the case to holders of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured other Indebtedness of the Company or a Guarantor that is pari passu with the Notes) to purchase Notes (and such other Indebtedness of the Company) pursuant to and subject to the conditions contained in the case this Indenture; provided, however, that in connection with any prepayment, repayment or purchase of revolving obligationsIndebtedness pursuant to clause (A) or (C) above, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will shall permanently retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will shall cause the related commitment (loan commitment, if any) , to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under . Notwithstanding the Notes or any other Indebtedness (other than Subordinated Indebtedness) foregoing provisions of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notesthis Section 4.10, Superior Energy, the Company and the Restricted Subsidiaries will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may not be below par), or (2) make an offer (required to apply any Net Available Cash in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) this paragraph except to the extent that the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of aggregate Net Available Cash from the date of such commitment all Asset Dispositions which are not applied in accordance with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final this Section 4.10 exceeds $20.0 million. Pending application of the amount of any such Net Available Cash pursuant to this Section 3.54.10, 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 Credit Facility. For the purposes of this Section 4.10, the following are deemed to be cash or Temporary Cash Investments: (i) the assumption of Indebtedness of Superior Energy, the Company or any Restricted Subsidiary (other than any of their Subordinated Obligations) and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) release of Superior Energy, the Company (or any such Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
Disposition and (2ii) securities, notes or other obligations any securities 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 or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents on the maturity date thereof but in no event later than 180 days after the receipt thereof (to the extent of the cash or Cash Equivalents received). The requirement of clause (a)(4) above shall be deemed to be satisfied if an agreement (including a lease) committing to make the acquisitions or expenditures referred to therein is entered into by Superior Energy, in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer Company or a Restricted Subsidiary as within the time period specified in such clause and such Net Available Cash is subsequently applied in accordance with such agreement within six months following such agreement. In the event of an Asset Disposition that requires the purchase of the Notes (and other pari passu Indebtedness of the Company) pursuant to clause (a)(4)(C) above, the Company will purchase Notes tendered pursuant to an offer by the Company for the Notes (and such other pari passu Indebtedness of the Company) at a result purchase price of 100% of their principal amount (or, in the event such other pari passu Indebtedness of the Company was issued with significant original issue discount, 100% of the accreted value thereof), without premium, plus accrued but unpaid interest and Additional Interest (or, in respect of such Asset Dispositionother pari passu Indebtedness of the Company, such lesser price, if any, as may be provided for by the terms of such Indebtedness of the Company) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture. If the aggregate purchase price of the 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 denominations of $1,000 principal amount or multiples thereof. Each of Superior Energy and the Company will comply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may beSection 3.09 hereof and this Section 4.10. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of Section 3.09 hereof and this IndentureSection 4.10, each of Superior Energy and the Company will comply with the applicable securities laws, rules laws and regulations and shall will not be deemed to have breached its obligations described in under Section 3.09 hereof and this Indenture Section 4.10 by virtue thereofof its compliance with such securities laws or regulations.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Issuer will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is with a Permitted Asset Swap)purchase price in excess of $5.0 million, at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) Disposition received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; provided, however, to the extent that any assets subject to a Disposition were Collateral, the non-cash consideration received is pledged as Collateral under the Collateral Documents substantially simultaneously with such sale, in accordance with the requirements of this Indenture and the Collateral Documents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied, either:
(ia) within 365 days from the receipt of such Net Available Cash, (x) to offer to prepay, repay or purchase the First Lien Notes or any other Indebtedness that is secured by a First Priority Lien (including, to the extent secured by a First Priority Lien, the Company Indebtedness under the New Credit Agreement or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), ABL Credit Agreement incurred pursuant to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (iiSECTION 3.2(b) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof)) (other than the Existing 2028 Secured Notes) or (y) to offer to prepay, repay or purchase the Second Lien Notes or any other Second Priority Obligations (or any Refinancing Indebtedness in respect thereof), provided that, to the extent the assets sold Issuer prepays, repays or otherwise disposed of in connection with purchases any other such Asset Disposition constituted “borrowing base assets”)Second Priority Obligations, the Issuer shall equally and will cause the related commitment ratably reduce (if any) or offer to be reduced in an amount equal to the principal amount so prepaidreduce, repaid or purchased; (iiias applicable) Obligations under the Second Lien Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notesthrough open market purchases, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) by redeeming Second Lien Notes as described provided under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par)SECTION 5.7, or (2) make an offer (in accordance with the procedures set forth below for by making an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(iib) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including i) capital expenditures, (ii) long-term fixed assets or (iii) any other Investment permitted by means clauses (9) or (23) of the definition of “Permitted Investment” (in each case, which such Investment shall be permitted by this Indenture) in an investment amount not to exceed $35.0 million in Additional Assets by a Restricted Subsidiary equal the aggregate for all such reinvestments made pursuant to this clause (a)(3)(b) in any fiscal year within 365 days from the amount date of receipt of such Net Available Cash received by the Company or another Restricted Subsidiary)Cash; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 90 days of such commitment (an “Acceptable Commitment”); or
provided that (iiix) if any combination Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Excess Proceeds as of the foregoingdate of such cancellation or termination and (y) such Net Available Cash shall constitute Excess Proceeds if there is a Specified Default at the time of a proposed reinvestment unless such proposed reinvestment is made pursuant to a binding commitment entered into at a time when no Specified Default was continuing; provided that that, (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5in accordance with clauses (a)(3)(a) and (a)(3)(b) above, the Company or the applicable Restricted Issuer and its Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture Indenture; and (2) the Company Issuer (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets (i) capital expenditures, (ii) long-term fixed assets or (iii) any other Investment permitted by clauses (9) or (23) of the definition of “Permitted Investment” (in each case, which such Investment shall be permitted by this Indenture) prior to receiving the Net Available Cash attributable to any given Asset Disposition (provided that if the assets subject to the disposition constituted Collateral, any such assets are pledged as Collateral under the Collateral Documents substantially simultaneously with such acquisition in accordance with the requirements of this Indenture and the Collateral Documents, such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iib) above with respect to such Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (iHeartMedia, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
unless (1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value (such fair market including the value to be of all non-cash con sideration), as determined on in good faith by the date Board of contractually agreeing to such Asset Disposition) Directors, of the shares and assets subject to such Asset Disposition Disposition, and at least 85% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents and (including, for ii) an amount equal to 100% of the avoidance of doubt, if Net Available Cash from such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received applied by the Company (or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth belowFIRST, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(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), to repay prepay, repay, redeem or purchase Senior Indebtedness or Indebtedness (iother than any Disqualified Stock) Obligations under of a Debt Facility Wholly Owned 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 such Asset Disposition or the receipt of such Net Available Cash; (B) SECOND, to the extent of the balance of such Obligations were Incurred under Net Available Cash after application in accordance with clause (1A), to the extent the Company elects, to acquire Additional Assets; PROVIDED, HOWEVER, that the Company shall be required to commit such Net Available Cash to the acquisition of Additional Assets within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash (the "Receipt Date") and shall be required to consummate the acquisition of such Additional Assets within 18 months from the Receipt Date; (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 pursuant to Section 4.07(b) 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 (D) FOURTH, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C) to (x) the acquisition by the Company or any Wholly Owned Subsidiary or such Restricted Subsidiary of Additional Assets or (y) the prepayment, repayment or purchase of Indebtedness (other than any Disqualified Stock) of the second paragraph under Section 3.2 Company (and in other than Indebtedness owed to an Affiliate of the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (iiCompany) Obligations under Secured or Indebtedness of any Subsidiary (other than Indebtedness owed to the Company or a Guarantor an Affiliate of the Company), in each case within one year from the later of the receipt of such Net Available Cash and the date the offer described in Section 4.07(b) is consummated; PROVIDED, HOWEVER, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (and in the case of revolving obligationsA), to correspondingly reduce commitments with respect thereto); provided that (C) or (D) above, the Company or such Restricted Subsidiary will shall retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will 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; (iii) Obligations under . Notwithstanding the Notes or any other Indebtedness (other than Subordinated Indebtedness) foregoing provisions of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notesthis paragraph, the Company will either (1) reduce Obligations under and the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may Restricted Subsidiaries shall not be below par), or (2) make an offer (required to apply any Net Available Cash in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) this paragraph except to the extent that the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of aggregate Net Available Cash from the date of such commitment all Asset Dispositions which are not applied in accordance with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final this paragraph exceeds $2.5 million. Pending application of the amount of any such Net Available Cash pursuant to this Section 3.54.07, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice invested in Permitted Investments. Notwithstanding anything contained in Article IV to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject to the limitations with respect to Foreign Dispositions set forth belowcontrary, the Company shall make not sell, convey, pledge, hypothecate or otherwise transfer the Houston Facility substantially as an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration entirety in one transaction or a series of the Proceeds Application Period related transactions to all Holders of Notes andany Person, 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 accreted value thereof, if less), 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), toincluding, 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, except for (i) pledges or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liabilitysecurity interests granted in connection with securing Indebtedness borrowed under the Credit Agreement, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States and (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(dii) transactions that comply with Article V. For the purposes of this Section 3.5(a)(2) hereof4.07, the following will be are deemed to be cash:
cash or cash equivalents: (1x) the express assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) any Restricted Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
Disposition and (2y) securities, notes or other obligations securities received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalentswithin 90 days of closing the transaction.
(b) In the event of an Asset Disposition that requires the purchase of the Securities (and other Senior Subordinated Indebtedness) pursuant to Section 4.07(a)(ii)(C), or by their terms are the Company will be required to purchase Securities tendered pursuant to an offer by the Company for the Securities (and other Senior Subordinated Indebtedness) at a purchase price of 100% of their principal amount (without premium) plus accrued but unpaid interest (or, in respect of such other Senior Subordinated Indebtedness, such lesser price, if any, as may be satisfied provided for cash by the terms of such Senior Subordinated Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture. If the aggregate purchase price of Securities (and any other Senior Subordinated Indebtedness) tendered pursuant to such offer is less than the Net Available Cash Equivalents (allotted to the extent purchase thereof, the Company will be required to apply the remaining Net Available Cash in accordance with Section 4.07(a)(ii)(D). The Company shall not be required to make such an offer to purchase Securities (and other Senior Subordinated Indebtedness) pursuant to this covenant if the Net Available Cash available therefor is less than $10 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).
(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, 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 prorationing 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 cash 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 Cash Equivalents receivedcorresponding successor reports), (ii) a description of material developments in each case, within 180 days following the closing 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"), (ii) the allocation of the Net Available Cash from the Asset Disposition;Dispositions pursuant to which such Offer is being made and (iii) the compliance of such allocation with the provisions of Section 4.07(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) in Temporary Cash Investments an amount equal to the Offer Amount 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 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 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, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with this Section.
(3) Indebtedness Holders electing to have a Security purchased will be required to surrender the Security, with an appro priate form duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders will be entitled to withdraw their election if the Trustee or the Company receives not later than one Business Day prior to the Purchase Date, a telegram, telex, facsimile transmission or letter setting forth the name of any Restricted Subsidiary the Holder, the principal amount of the Security which was delivered for purchase by the Holder and a statement that such Holder is no longer withdrawing his election to have such Security purchased. If at the expiration of the Offer Period the aggregate principal amount of Securities surrendered by Holders exceeds the Offer Amount, the Company shall select the Securities to be purchased on a Restricted Subsidiary pro rata basis (with such adjustments as a result may be deemed appropriate by the Company so that only Securities in denominations of $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.
(4) At the time the Company delivers Securities to the Trustee which are to be accepted for purchase, the Company will also deliver an Officers' Certificate stating that such Asset DispositionSecurities are to be accepted by the Company pursuant to and in accordance with the terms of this Sec tion. 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 surrender ing Holder.
(d) The Company shall comply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture Section by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) except in the case of a Permitted Asset Swap, in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)Dispositions, at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (a) to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase any Indebtedness of a Non-Guarantor Subsidiary (in each case, other than Indebtedness owed to the Company or a Guarantor any Restricted Subsidiary) or any Secured Indebtedness, including Indebtedness under the First Lien Credit Agreement or the ABL Credit Agreement (and or, in the case of revolving obligationseach case, to correspondingly reduce commitments with any Refinancing Indebtedness in respect theretothereof); provided that provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility or other revolving credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiii) Obligations under to prepay, repay or purchase Pari Passu Indebtedness; provided that, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) of extent the Company redeems, repays or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior repurchases such Indebtedness other than the Notespursuant to this clause (ii), the Company will either (1) shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes Section 5.7 through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary)) or make capital expenditures; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior First Lien Credit FacilitiesAgreement or the ABL Credit Agreement) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture Indenture, and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 75 million (such amount of Net Available Cash that are less than or equal to $60.0 75 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 75 million, “Excess Proceeds”), then, then subject to the limitations with respect to Foreign Dispositions set forth belowbelow and the immediately subsequent paragraph, the Company shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 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.
(bc) Notwithstanding the foregoing, the amount of Net Available Cash required to be applied in an Asset Disposition Offer will reduce to an amount equal to 50% of Excess Proceeds if the Consolidated First Lien Secured Leverage Ratio is equal to or less than 2.00 to 1.00 on a pro forma basis and such amount will further reduce to an amount equal to 0% of Excess Proceeds if the Consolidated First Lien Secured Leverage Ratio is equal to or less than 1.75 to 1.00 on a pro forma basis. Any such amounts not required to be applied in such Asset Disposition Offer pursuant to this paragraph shall be deemed to constitute Declined Excess Proceeds.
(d) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(ce) Notwithstanding any other provisions of this Section Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash so affected will not be required to be applied in compliance with this Section Section 3.5, and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section Section 3.5; andor
(ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including as a result of receipt of a Tax dividend, a deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section Section 3.5(a)(2) hereof), the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise otherwise, of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 90.0 million and (b) 7.535.0% of LTM EBITDA (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).
(eg) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to To the extent those laws and regulations are applicable that any portion of Applicable Proceeds payable in connection with each repurchase respect of the Notes pursuant to an Asset Disposition Offer or Advance Offeris denominated in a currency other that U.S. dollars, as the case may be. amount thereof payable in respect of the Notes shall not exceed the net amount of funds in U.S. dollars that is actually received by the Company upon converting such portion into U.S. dollars.
(h) To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof. The Company may rely on any no-action letters issued by the SEC indicating that the staff of the SEC will not recommend enforcement action in the event a tender offer satisfies certain conditions.
(fi) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Option Care Health, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
: (1) in the case of any Asset Disposition involving shares or assets having a value equal to or in excess of $1.0 million, the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Board of Directors (including the value of all non-cash consideration), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
Disposition; (2) in the case of any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is involving shares or assets having a Permitted Asset Swap)value equal to or in excess of $1.0 million, at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) Disposition received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
and (3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any such Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay be (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay or purchase secured Indebtedness of the Company or secured Indebtedness of a Restricted Subsidiary (other than any Disqualified Stock or Guarantor Subordinated Obligations of a Restricted Subsidiary that is a Subsidiary Guarantor), in each case other than Indebtedness owed to the Company or an Affiliate of the Company (and in other than to the case of revolving obligationsextent such Indebtedness is permitted under Sections 3.3(b)(1), to correspondingly reduce commitments 3.3(b)(2)(solely with respect theretoto Guarantees under this Agreement), 3.3(b)(4)(a), 3.3(b)(4)(c)(solely with respect to the Securities), Section 3.3(b)(6), Section 3.3(b)(10) and Section 3.3(b)(11)), within 360 days from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; provided that provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), 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; purchased (iii) Obligations under except, after the Notes ABL Revolver Date, with respect to prepayments or any other Indebtedness (other than Subordinated Indebtedness) repayments of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either ABL Obligations pursuant to this clause (1i)) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means within 360 days from the later of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with Asset Disposition or the good faith expectation that an amount equal to receipt of such Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoingCash; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with Section 3.53.7(a)(3)(a) or Section 3.7(a)(3)(b) above, the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted SubsidiaryIndenture; provided, as further, that in the case may beof an Asset Disposition of Collateral, any cash will be deposited in the Collateral Account or otherwise in accordance with the Intercreditor Agreement.
(b) may elect to invest in Additional Assets prior to receiving the Any Net Available Cash attributable from Asset Dispositions that are not applied or invested as provided in Section 3.7(a)(3) will be deemed to any given Asset Disposition (provided that such investment shall be made no earlier than constitute “Excess Proceeds.” On the earliest of written notice to the Trustee of the relevant 361st day after an Asset Disposition, execution of a definitive agreement for if 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such aggregate amount of Net Available Cash that are less than or equal to Excess Proceeds exceeds $60.0 5.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject to the limitations with respect to Foreign Dispositions set forth below, the Company shall will be required to make an offer (an “Asset Disposition Offer”) no later than 10 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, Securities to purchase the maximum principal amount of such Notes and Pari Passu Indebtedness, as appropriate, on a pro rata basis, Securities to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, in the case of the Notes, price in cash in an amount equal to 100% of the principal amount thereof (or accreted value thereof, if less), of the Securities plus accrued and unpaid interest, if any (or such lesser price with respect interest to Pari Passu Indebtedness, if any, as may be provided by the terms of such other Indebtedness), to, but not including, including the date fixed for the closing of such offerpurchase, 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 1 principal amount and in integral multiples of $1,000 1 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 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 Securities so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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 OfferExcess Proceeds, the Company may include use any remaining Excess Proceeds (orx) for general corporate purposes, subject to other covenants contained in this Indenture; provided that to the case extent that the assets disposed of an Advance Offerin such asset sale constitutes Collateral, the Advance Portion) in Declined Excess Proceeds, and use any assets purchased with such Declined Excess Proceeds shall be pledged as Collateral pursuant to the Collateral Documents or (y) to make Restricted Payments in accordance with Section 3.5(a) (such Excess Proceeds not so invested, applied or used for any purpose not otherwise prohibited by this Indenturegeneral corporate purposes, “Extra Asset Sale Proceeds”). If the aggregate principal amount (of Securities surrendered by holders thereof surrendered by holders or accreted valuelenders, as applicable) of the Notes orcollectively, if applicable, Pari Passu Indebtedness validly tendered pursuant to any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance OfferProceeds, the Advance Portion), Trustee shall select the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness Securities to be purchased on a pro rata basis on the basis in authorized denominations of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denominationSecurities. Upon completion of any such Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c1) Notwithstanding any other provisions The Asset Disposition Offer shall remain open for a period of this Section 3.5,
(i) 20 Business Days following its commencement, except to the extent that any of or all a longer period is required by applicable law (the Net Available Cash of any “Asset Disposition by a Foreign Subsidiary or a CFC Holding Company Offer Period”). No later than five Business Days after the termination of the Asset Disposition Offer Period (a the “Foreign DispositionAsset Disposition Purchase Date”) 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), the portion Company will purchase the principal amount of such Net Available Cash so affected will not be Securities required to be applied in compliance with purchased pursuant to this Section 3.53.7 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Securities validly tendered in response to 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 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 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 Securities or portions thereof 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 so validly tendered and not properly withdrawn, in each case in denominations of $1 and integral multiples of $1 in excess thereof. The Company will deliver to the Trustee an Officers’ Certificate stating that such amounts may be retained Securities or portions thereof were accepted for payment by the applicable Foreign Subsidiary Company in accordance with the terms of this Section 3.7. The Company or CFC Holding Company so long, but only so longthe Paying Agent, as the applicable local law or regulationcase may be, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and such repatriated Net Available Cash will be promptly (and but in any event case not later than five Business Days after such repatriation could be madetermination of the Asset Disposition Offer Period) applied (net mail or deliver to each tendering Holder of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
(ii) Securities an amount equal to the extent that purchase price of the Securities so validly tendered and not properly withdrawn by such Holder or lender, as the case may be, and accepted by the Company has determined for purchase, and the Company will promptly issue a new Security, and the Trustee, upon delivery of a Company Order, will authenticate and mail or deliver such new Security to such Holder, in good faith a principal amount equal to any unpurchased portion of the Security surrendered; provided that repatriation of, each such new Security will be in a principal amount of $1 or an obligation to repatriate, any integral multiple of $1 in excess thereof. Any Security not so accepted will be promptly mailed or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained delivered by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from Holder thereof. The Company will publicly announce the determination results of the amount of any mandatory prepayments hereunder)Asset Disposition Offer on the Asset Disposition Purchase Date. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of this Section 3.5(a)(2) hereof3.7, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness (other than Subordinated Obligations or other liabilities, contingent or otherwise Disqualified Stock) of the Company or Indebtedness of a Restricted Subsidiary (other than Guarantor Subordinated Indebtedness Indebtedness, Guarantor Subordinated Obligations or Disqualified Stock of the Company or any Wholly- Owned Subsidiary that is a Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;Disposition (in which case the Company will, without further action, be deemed to have applied such deemed cash to Indebtedness in accordance with Section 3.7(a)(3)(a)); 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 or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;cash.
(3d) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset DispositionThe Company will comply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Indenture. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 3.7, the Company will comply with the applicable securities laws, rules laws and regulations and shall will not be deemed to have breached its obligations described in under this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (NBC Acquisition Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, In the event and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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) of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another any Restricted Subsidiary); providedSubsidiary from one or more Asset Dispositions occurring on or after the Original Issue Date in any period of 12 consecutive months exceeds 10% of Adjusted Consolidated Assets as of the beginning of such 12-month period, however, that a binding agreement then the Company shall be treated as a permitted application (i) within 180 days (in the case of clause (A) below) or 360 days (in the case of clause (B) below) after the date such Net Available Cash from the date so received exceeds such 10% of such commitment with the good faith expectation that Adjusted Consolidated Assets (A) apply an amount equal to such excess Net Available Cash will be applied to satisfy such commitment within 180 days repay Senior Indebtedness of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under of a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as in each case owing to a Person other than the case may beCompany or any Affiliate of the Company or (B) may elect invest an equal amount, or the amount not so applied pursuant to invest clause (A), in 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 written notice to the Trustee of the relevant Asset Dispositionor a Permitted Business Investment, 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 Asset Disposition. If, with respect to any Asset Disposition, at within 120 days of the expiration of the period described in clause (i) (B) above, apply such excess Net Available Cash, or the amount not applied pursuant to clause (i), to fund the purchase price of Existing Securities tendered in response to an Excess Proceeds Application Period with respect to Offer (as defined in the Existing Indenture) for the Existing Securities or (iii) apply such Asset Disposition, there remains excess Net Available Cash (to the extent not applied pursuant to clause (i) or (ii)) as provided in excess the following paragraphs of $60.0 million (such this Section 4.06. The amount of such excess Net Available Cash that are less than or equal required to $60.0 million, “Declined be applied during the applicable period and not applied as so required by the end of such period shall constitute "Excess Proceeds,” and such ".
(i) If, as of the first day of any calendar month, the aggregate amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, Proceeds not theretofore subject to the limitations with respect to Foreign Dispositions set forth an Excess Proceeds Offer (as defined below) totals at least $10.0 million, the Company shall must, not later than the fifteenth Business Day of such month, make an offer (an “Asset Disposition "Excess Proceeds Offer”") no later than 10 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 from the maximum principal amount of such Notes and Pari Passu Indebtedness, as appropriate, Holders on a pro rata basis, that may be purchased out basis an aggregate principal amount of Securities equal to the Excess Proceeds (rounded down to the nearest multiple of $1,000) on such Excess Proceeds, if anydate, at an offer price, in the case of the Notes, in cash in an amount a purchase price equal to 100% of the principal amount thereof of such Securities, plus, in each case, accrued interest (or accreted value thereof, if less), 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, ) to the date fixed for of purchase (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. "Excess Proceeds Payment").
(ii) The Company may satisfy the foregoing obligation shall commence any Excess Proceeds Offer with respect to the Net Available Cash Securities by making an Asset Disposition mailing a notice to the Trustee and each Holder stating: (A) that the Excess Proceeds Offer is being made pursuant to this Section 4.06 and that all Securities validity tendered will be accepted for payment on a pro rata basis; (B) the purchase price and the date of purchase (which shall be a Business Day no earlier than 30 days nor later than 60 days from the date such notice is mailed) (the "Excess Proceeds Payment Date"); (C) that any Security not tendered will continue to accrue interest pursuant to its terms; (D) that, unless the Company defaults in the payment of the Excess Proceeds Payment, any Security accepted for payment pursuant to the Excess Proceeds Offer shall cease to accrue interest on and after the Excess Proceeds Payment Date; (E) that Holders electing to have a Security purchased pursuant to the Excess Proceeds Offer will be required to surrender the Security, together with the form entitled "Option of Holder to Elect Purchase" on the reverse side of the Security completed, to the Paying Agent at the address specified in the notice prior to the expiration close of business on the Business Day immediately preceding the Excess Proceeds Payment Date; (F) that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the close of business on the third Business Day immediately preceding the Excess Proceeds Payment Date, a telegram, facsimile transmission or letter setting forth the name of such Holder, the principal amount of Securities delivered for purchase and a statement that such Holder is withdrawing his election to have such Securities purchased; and (G) that Holders whose Securities are being purchased only in part will be issued new Securities equal in principal amount to the unpurchased portion of the Proceeds Application Period (the “Advance Offer”) with respect to all Securities surrendered; provided, however, that each Security purchased and each new Security issued shall be in a principal amount of $1,000 or a part of the Net Available Cash (the “Advance Portion”) in advance of being required to do so by this Indentureintegral multiples thereof.
(biii) To On the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion)Payment Date, the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased (A) accept for payment on a pro rata basis on Securities or portions thereof tendered pursuant to the basis Excess Proceeds Offer, (B) deposit with the Paying Agent money sufficient to pay the purchase price of all Securities or portions thereof so accepted, and (C) deliver, or cause to be delivered, to the Trustee all Securities or portions thereof so accepted together with an Officers' Certificate specifying the Securities or portions thereof so accepted for payment by the Company. The Paying Agent shall promptly mail to the Holders of Securities so accepted payment in an amount equal to the purchase price, and the Trustee shall promptly authenticate and mail to such Holders a new Security equal in principal amount to any unpurchased portion of the aggregate Security surrendered; provided, however; that each Security purchased and each new Security issued shall be in a principal amount (of $1,000 or accreted value, integral multiples thereof. The Company will publicly announce the results of the Excess Proceeds Offer as applicable) soon as practicable after the Excess Proceeds Payment Date. For purposes of tendered Notes and such Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offerthis Section 4.06, the amount of Net Available Cash and Excess Proceeds Trustee shall be reset at zeroact as the Paying Agent.
(civ) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding The Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositioncomply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder in the event that such Excess Proceeds are received by the Company under this Section 4.06 and the Company is required to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, Securities as the case may bedescribed above. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 4.06, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture Section 4.06 by virtue thereof.
(fc) The In the event of the transfer of substantially all (but not all) the property and assets of the Company as an entirety to a Person in a transaction permitted by Section 5.01, the Successor Company (as defined therein) shall be deemed to have sold the properties and assets of the Company not so transferred for purposes of the covenant described hereunder, and shall comply with the provisions of this Indenture relative the covenant described hereunder with respect to such deemed sale as if it were an Asset Disposition and the Successor Company shall be deemed to have received Net Available Cash in an amount equal to the Company’s obligation to make an offer to repurchase fair market value (as determined in good faith by the Notes as a result Board of Directors) of the properties and assets not so transferred or sold.
(d) In the event of an Asset Disposition may be waived by the Company or modified with any Restricted Subsidiary that consists of a sale of hydrocarbons and results in Production Payments, the written consent Company or such Restricted Subsidiary shall apply an amount equal to the Net Available Cash received by the Company or such Restricted Subsidiary to (i) reduce Senior Indebtedness of the Holders Company or Indebtedness of a majority Restricted Subsidiary, in aggregate principal amount each case owing to a Person other than the Company or any Affiliate of the then outstanding NotesCompany, within 180 days after the date such Net Available Cash is so received or (ii) invest in Additional Assets or a Permitted Business Investment within 360 days after the date such Net Available Cash is so received.
Appears in 1 contract
Sources: Indenture (Kelley Operating Co LTD)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Issuer will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 an Officer or the Board of Directors of the Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);; and
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition or such series of related Asset Dispositions (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, other than Indebtedness), together with all other Asset Dispositions since the Issue Date (except to the extent any such Asset Disposition was a Permitted Asset Swap) on a cumulative basis) basis received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash Equivalents; andInvestments.
(3b) After the receipt of Net Available Cash from an Asset Disposition, the Issuer or a Restricted Subsidiary, as the case may be, may apply such Net Available Cash directly or indirectly (at the option of the Issuer or such Restricted Subsidiary):
(1) within 18 months 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company prepay, repay, purchase or redeem any Restricted SubsidiarySenior Secured Indebtedness incurred under Section 4.04(b)(1); provided, as the case may behowever, elects that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (or is required by the terms of any Indebtednessi), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Issuer or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of any revolving Indebtedness) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchasedredeemed; (iiiii) Obligations under unless included in clause (i), to prepay, repay, purchase or redeem any Pari Passu Indebtedness of the Issuer or a Subsidiary Guarantor that is secured in whole or in part by a Lien on the Notes or any other Indebtedness Collateral (other than Subordinated Indebtedness) including by virtue of the Company Intercreditor Agreement or any Restricted Subsidiaryan Additional Intercreditor Agreement), which Lien ranks pari passu with the Liens securing the Notes, at a price of no more than 100% of the principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest to the date of such prepayment, repayment, purchase or redemption; provided that the Issuer or such Subsidiary Guarantor, as applicable, shall prepay, redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to this clause (ii) only if the Company Issuer or any Restricted such Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes Guarantor purchases through open-market purchases at a price equal to or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less higher than 100% of the principal amount thereof, plus or makes an offer to the amount Holders of accrued but unpaid interest, if any, thereon up the Notes to purchase their Notes at a purchase price in cash equal to at least 100% of the principal amount of such Notes, plus accrued and unpaid 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 due on the relevant interest payment date) for, in each case, an aggregate principal amount of Notes at least equal to be repurchased the proportion that (which offer shall be deemed x) the total aggregate principal amount of Notes outstanding bears to be an Asset Disposition Offer for purposes hereof)(y) the sum of the total aggregate principal amount of Notes outstanding plus the total aggregate principal amount outstanding of such Pari Passu Indebtedness; (iii) to prepay, repay, purchase or (iv) redeem any Indebtedness of a Restricted Subsidiary that is not a GuarantorSubsidiary Guarantor or any Indebtedness that is secured on assets which do not constitute Notes Collateral (in each case, other than Subordinated Indebtedness of the Issuer or a Subsidiary Guarantor or Indebtedness owed to the Company Issuer or another any Restricted Subsidiary); (iv) to purchase the Notes through open-market purchases at a price equal to or higher than 100% of the principal amount thereof, or make an offer to all holders of the Notes at a purchase price in cash equal to at least 100% of the principal amount of the Notes, plus accrued and unpaid 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 due on the relevant interest payment date) or (v) to redeem the Notes as described under Section 3.07;
(ii2) to the extent the Company Issuer or any such Restricted Subsidiary elects, to invest in or purchase or commit to invest in or purchase Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company Issuer or another Restricted Subsidiary)) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Issuer that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such investment or commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment invest is consummated within 180 days of such 365th day;
(3) to make a capital expenditure within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that any such capital expenditure made pursuant to a definitive binding agreement or a commitment (an “Acceptable Commitment”)approved by the Board of Directors of the Issuer that is executed or approved within such time will satisfy this requirement, so long as such investment is consummated within 180 days of such 365th day; or
(iii4) any combination of the foregoing; provided that clauses (1) through (3) of Section 4.08(b), provided that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clauses (1), (2), (3) or (4) of Section 3.54.08(b), the Company or Issuer and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and Indenture.
(c) Any Net Available Cash from Asset Dispositions that is not applied or invested or committed to be applied or invested as provided in Section 4.08(b) will be deemed to constitute “Excess Proceeds.” On the 366th day (or the 546th day, in the case of any Net Available Cash committed to be used pursuant to a definitive binding agreement or commitment approved by the Board of Directors of the Issuer pursuant to clause (2) or (3) of Section 4.08(b)) after the Company later of (or any Restricted Subsidiary, as A) the case may bedate of such Asset Disposition and (B) may elect to invest in Additional Assets prior to receiving the receipt of such Net Available Cash attributable to any given Asset Disposition (provided that such investment shall be made no earlier than Cash, if the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such aggregate amount of Net Available Cash that are less than or equal to Excess Proceeds exceeds $60.0 35 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject the Issuer will be required within ten (10) Business Days thereof to the limitations with respect to Foreign Dispositions set forth below, the Company shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration to all holders of the Proceeds Application Period to all Holders of Notes and, if to the extent the Issuer or a Subsidiary Guarantor elects or the Issuer or a Subsidiary Guarantor is required by the terms of any other outstanding Pari Passu Indebtedness, to all holders of such other outstanding Pari Passu Indebtedness, Indebtedness to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer priceprice in respect of the Notes in an amount equal to (and, in the case of the Notesany Pari Passu Indebtedness, in cash in an amount equal to offer price of no more than) 100% of the principal amount thereof (or accreted value thereofof such Notes and 100% of the principal amount of Pari Passu Indebtedness, if less)in each case, 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 offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and in the case of the Notes, in minimum denominations of $2,000 200,000 and in integral multiples of $1,000 in excess thereof. Notices of an Asset Disposition Offer No such purchase in part shall be sent by first class mail or sent electronically, reduce the principal amount at least 10 days but not more than 60 days before the purchase date to each Holder maturity of the Notes at such Holder’s registered address or otherwise in accordance with the applicable procedures of DTC, with a copy held by any holder to the Trusteebelow $200,000. The Company Issuer may satisfy the foregoing obligation obligations with respect to the 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 Proceeds Application Period (the “Advance Offer”) time period that may be required by this Indenture with respect to all or a part of the available Net Available Cash (the “Advance Portion”) in advance of being required to do so by this IndentureIndenture (an “Advance Offer”).
(bd) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to an Asset Disposition Offer made with is less than the 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 Issuer and the Restricted Subsidiaries may include use any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceedsfor general corporate purposes, and use such Declined Excess Proceeds for any purpose to the extent not otherwise prohibited by the other covenants contained in 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 surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; provided . For the purposes of calculating the principal amount of any such Indebtedness not denominated in dollars, such Indebtedness shall be calculated by converting any such principal amounts into their Dollar Equivalent determined as of a date selected by the Issuer that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denominationis within the Asset Disposition Offer Period (as defined below). Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions , and in the case of this Section 3.5,
(i) to an Advance Offer, the extent that any amount of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (a “Foreign Disposition”) the Issuer is (x) prohibited or delayed by applicable local law, (y) restricted by applicable organizational documents or any agreement or (z) subject offering to other onerous organizational or administrative impediments from being repatriated to the United States, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary apply in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater Advance Offer shall be excluded in subsequent calculations of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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)Excess Proceeds.
(e) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than dollars, the amount thereof payable in respect of the Notes shall not exceed the net Dollar Equivalent of the amount that is actually received by the Issuer.
(f) The Company Asset Disposition Offer, in so far as it relates to the Notes, will remain open for a period of not less than 20 Business Days following its commencement or such shorter period of time required to comply with the requirements Section 14(e) of Rule 14e-1 under the Exchange Act and any other applicable securities laws and or regulations thereunder in connection with the Asset Disposition Offer (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 those laws and regulations are applicable in connection with each repurchase of Notes it elects, Pari Passu Indebtedness required to be purchased by it pursuant to an this Section 4.08 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(g) On or Advance before the Asset Disposition Purchase Date, the Issuer 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 Indebtedness or portions of Notes and Pari Passu Indebtedness so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, as or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Indebtedness so validly tendered and not properly withdrawn and, in the case may be. To of the extent that the provisions Notes, in minimum denominations of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions $200,000 and in integral multiples of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described $1,000 in this Indenture by virtue excess thereof.
(fh) The provisions Issuer will deliver to the Trustee an Officer’s Certificate stating that such Notes or portions thereof were accepted for payment by the Issuer in accordance with the terms of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding NotesSection 4.
Appears in 1 contract
Sources: Indenture (Altice USA, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions Disposition (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 455 days from the later of (A) the date 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 the 100% of such Net Available Cash is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay elects:
(i) Obligations (a) to reduce, prepay, repay or purchase any Secured Indebtedness, including Indebtedness under a Debt Facility the Credit Agreement (or any Refinancing Indebtedness in respect thereof), (b) to reduce, prepay, repay or purchase Pari Passu Indebtedness; provided that the extent such Obligations were Incurred Company ratably repay the Notes, (c) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer), redeem Notes as described under clause Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (1d) of the second paragraph under Section 3.2 (and in the case of revolving obligationsto reduce, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured prepay, repay or purchase any Indebtedness of a Non-Guarantor (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretoany Restricted Subsidiary); provided that provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(iia) to the extent the Company or any Restricted Subsidiary elects, 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 equal Subsidiary); or (b) to invest (including capital expenditures) in any one or more businesses (provided that any such business will be a Restricted Subsidiary), properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event of any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Company or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; provided, further, that if any Second Commitment is later cancelled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Excess Proceeds; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of the greater of $60.0 80.0 million and 10.0% of LTM EBITDA (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 millionamount, “Excess Proceeds”), then, 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 10 ten (10) 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 ten (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 any 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 or otherwise surrendered in connection with an Asset Disposition Offer made with Excess Proceeds is less than the amount offered in an Asset Disposition Offer (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 use any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in (the “Declined Excess Proceeds, and use such Declined Excess Proceeds ”) for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero. To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(c) Notwithstanding any other provisions of this Section Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition are received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash so affected will not be required to be applied in compliance with this Section Section 3.5, and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulationlaw, applicable organizational documents impediments or other impediments 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 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 (5) Business Days after such repatriation could be made) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section Section 3.5; and
(ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment out of any such Net Available Cash whereby doing so the Company, any Restricted Subsidiaryof its Subsidiaries, any Parent Entity or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax), the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder)Subsidiary. The non-application nonapplication of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and or the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 160.0 million and (b) 7.520.0% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereofof compliance therewith.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding Notesoutstanding.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
unless (1i) the Company or such Restricted Subsidiary receives consideration at the time of such Asset Disposition at least equal to the fair market value, as determined in good faith by the Board of Directors (including as to the value of all non-cash consideration), of the shares and assets subject to such Asset Disposition, (ii) at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or Cash Equivalents 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, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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) of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth belowfirst, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(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), to prepay, repay or purchase Senior Indebtedness or Indebtedness (iother than any Preferred Stock) Obligations under of a Debt Facility Wholly-Owned Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Company) within 180 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 Obligations were Incurred under Net Available Cash after ------ application in accordance with clause (1) A), at the Company's election to the investment in Additional Assets within one year from the later of the second paragraph under Section 3.2 date 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 and in the case of revolving obligationsaccordance with clauses (A) and (B), to correspondingly reduce commitments with respect thereto)make an offer to purchase (an "Offer") Notes and other pari passu debt obligations subject to a similar covenant (collectively, the "pari passu Notes") at par plus accrued and unpaid interest, if any, thereon; and (iiD) Obligations under Secured Indebtedness fourth, to the extent of the Company balance of such Net ------ Available Cash after application in accordance with clauses (A), (B) and (C), for other general corporate purposes not prohibited by the Indenture; provided, however, that, in connection with any prepayment, repayment or a Guarantor purchase of Indebtedness pursuant to clause (and in the case of revolving obligationsA) above, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will shall retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will 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; (iii) Obligations under . Notwithstanding the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notesforegoing provisions, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at and its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may Restricted Subsidiaries shall not be below par), or (2) make an offer (required to apply any Net Available Cash in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) herewith except to the extent that the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of aggregate Net Available Cash from all Asset Dispositions which are not applied in accordance with this covenant exceed $5 million. The Company shall not be required to make an Offer for the date of such commitment with Notes and for the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pari passu Notes pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving covenant if the Net Available Cash attributable to available therefor (after application of the proceeds as provided in clauses (A) and (B)) are less than $5 million for any given particular Asset Disposition (provided that such investment which lesser amounts shall be made no earlier than the earliest carried forward for purposes of written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject to the limitations with respect to Foreign Dispositions set forth below, the Company shall make determining whether an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes and, if Offer is 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 accreted value thereof, if less), 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 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, from any other Pari Passu Indebtedness validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such subsequent Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Details Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Following the Closing, the Company and its Subsidiaries may make Asset Dispositions in an aggregate amount not to exceed $10 million in any fiscal year of the Company.
(b) Following the Closing, the Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
which, either alone or together with all other Asset Dispositions made by the Company and its Subsidiaries during such fiscal year, exceeds $10 million unless (1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value value, as determined in good faith by the Board of Directors (if such fair market value is greater than $10,000,000), the determination of which shall be evidenced by a Board Resolution (including as to be determined on the date value of contractually agreeing to all non- cash consideration (if such Asset Disposition) fair market value is greater than $3,000,000)), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), ii) at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (Biii) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company (or any Restricted such Subsidiary, as the case may be) (A) first, to the extent the Company elects (or is required by the terms of any Senior Indebtedness), to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase Senior Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated IndebtednessPreferred Stock) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted a Wholly Owned Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, case other than Indebtedness owed to the Company or another Restricted Subsidiary;
an Affiliate of the Company) within 270 days from the later of the date of such Asset Disposition or the receipt of such Net Available Cash; (iiB) second, to the extent of the balance of Net Available Cash after application in accordance with clause (A), to the extent the Company or any Restricted such Subsidiary elects, to invest in or commit to invest reinvest in Additional Assets (including by means of an investment Investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application ) within 270 days from the later of such Asset Disposition or the receipt of such Net Available Cash from Cash; (C) third, to the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination extent of the foregoing; provided that (1) pending the final application balance of the amount of any such Net Available Cash after application in accordance with clauses (A) and (B), to make an Offer to purchase Securities pursuant to this and subject to the conditions of Section 3.54.06(c), and (D) fourth, to the Company or extent of the applicable Restricted Subsidiaries may apply balance of such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility after application in accordance with clauses (including under the Senior Credit FacilitiesA), (B) or otherwise apply such Net Available Cash in and (C), for any manner purpose not prohibited by the terms of this Indenture and Indenture. For the purposes of this Section, the following shall be deemed to be cash: (2x) the assumption of Indebtedness of the Company (other than Preferred Stock of the Company) or any Restricted Subsidiary, as Subsidiary and the case may be) may elect to invest in 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 written notice to the Trustee release of the relevant Asset Disposition, 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 Company or such Subsidiary from all liability with respect to such Asset Disposition. If, Indebtedness in connection with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains provided that the amount of such Indebtedness shall not be deemed to be cash for the purpose of the term "Net Available Cash in excess of $60.0 million Cash," and (such amount of Net Available Cash y) securities received by the Company or any Subsidiary from the transferee that are less than promptly converted by the Company or equal such Subsidiary into cash.
(c) In the event of an Asset Disposition that requires the purchase of Securities pursuant to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”Section 4.06(b)(iii)(C), then, subject to the limitations with respect to Foreign Dispositions set forth below, the Company shall make purchase Securities tendered pursuant to an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes and, if required by the terms Company for the Securities (the "Offer") at a purchase price 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 their principal amount thereof (or accreted value thereof, if less), plus accrued and unpaid interest, if any (or such lesser price with respect interest 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, Purchase Date in accordance with the procedures (including prorationing in the event of oversubscription) set forth in this Indenture and Section 4.06(b). If the agreement governing aggregate purchase price of Securities tendered pursuant to 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 is less than 60 days before the Net Available Cash allotted to the purchase date to each Holder of the Notes at such Holder’s registered address or otherwise Securities, the Company shall apply the remaining Net Available Cash in accordance with the applicable procedures of DTC, with a copy to the TrusteeSection 4.06(b)(iii)(D). The Company may satisfy shall not be required to make an Offer for Securities pursuant to this Section if the foregoing obligation Net Available Cash available therefor (after application of the proceeds as provided in clauses (A) and (B) of Section 4.06(b)(iii)) is less than $5,000,000 for any particular Asset Disposition (which lesser amounts shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash by making from any subsequent Asset Disposition).
(1) Promptly, and in any event within 10 days after the Company becomes obligated to make an Asset Disposition Offer prior Offer, the Company shall be obligated to deliver to the expiration 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 prorationing 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 information concerning the business of the Proceeds Application Period 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), (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, the Company shall deliver to the Trustee an Officers' Certificate as to (i) the amount of the Offer (the “Advance Offer”"Offer Amount"), (ii) with respect to all or a part the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being made and (iii) the compliance of such allocation with the provisions of Section 4.06(b). Upon the expiration of the period for which the Offer remains open (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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance PortionPeriod"), the Company shall allocate deliver to the Excess Proceeds among Trustee the Notes Securities or portions thereof which have been properly tendered to and Pari Passu Indebtedness are to be accepted by the Company and shall irrevocably deposit with the Trustee an amount of cash equal to the aggregate purchase price for the Securities tendered in the Offer, provided that such amount shall not exceed the Offer Amount. The Trustee shall, on the Purchase Date, mail or deliver payment to each tendering Holder in the amount of the purchase price.
(3) Holders electing to have a Security purchased will be required to surrender the Security, with an appropriate form duly completed, to the Company at the address specified in the notice at least 10 Business Days prior to the Purchase Date. Holders will be entitled to withdraw their election if the Trustee or the Company receives, not later than three Business Days prior to the Purchase Date, a telegram, 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 Holder is withdrawing his election to have such Security purchased. If, at the expiration of the Offer Period, the aggregate principal amount of Securities surrendered by Holders exceeds the Offer Amount, the Company shall select the Securities to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, with such adjustments as applicable) of tendered Notes and such Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received appropriate by the Company so that only Securities in denominations of $1,000, or any Restricted Subsidiary 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 Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; andSecurities surrendered.
(4) any Designated Non-Cash Consideration received by On or before the Purchase Date, the Company shall (i) accept for payment the Securities or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received portions thereof that have been properly tendered pursuant to the offer made pursuant to this Section 3.5 that is at that time outstanding4.06, not (ii) deposit with the Trustee an amount of cash equal to exceed the greater aggregate amount of the aggregate purchase price for the Securities and portions thereof properly tendered and accepted pursuant to clause (ai) $100.0 million and shall make arrangements satisfactory to the Trustee for such deposit prior to the date of the purchase date and (biii) 7.5% deliver to the Trustee the Securities or portions thereof which have been properly tendered to and accepted by the Company. The Trustee shall, on the Purchase Date, mail or deliver payment of LTM EBITDA (with the fair market value of purchase price to each item of Designated Non-Cash Consideration being measured tendering Holder. A Security shall be deemed to have been accepted for purchase at the time received and without giving effect the Trustee, directly or through an agent, mails or delivers payment therefor to subsequent changes in value)the surrendering Holder.
(e) The Company will comply shall comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture Section by virtue thereof.
(f) The provisions of this Indenture relative Notwithstanding anything to the Company’s obligation contrary contained in this Section, (i) Hexcel Technologies, Inc. may transfer up to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent 15% of the Holders outstanding partnership interests in HDP to DIC Technologies, Inc., (ii) the Company may sell the Specified Equipment to Ciba or any Affiliate of a majority Ciba and (iii) the Company or any Subsidiary may grant licenses in aggregate principal amount respect of intellectual property to Ciba or any Subsidiary of Ciba pursuant to the Strategic Alliance Agreement.
(g) Notwithstanding anything to the contrary contained in this Section, the Company shall be deemed to have complied with Section 4.06(b)(iii)(A) if the Net Available Cash from any sale or other disposition of any of the then Specified Properties are applied to repay outstanding Notesloans under the Credit Agreement (whether or not the commitments thereunder are reduced in connection therewith).
Appears in 1 contract
Sources: Indenture (Hexcel Corp /De/)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Borrower will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Borrower or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 an Officer or the Board of Directors of the Borrower, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);; and
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition or such series of related Asset Dispositions (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, other than Indebtedness), together with all other Asset Dispositions since the Issue Effective Date (except to the extent any such Asset Disposition was a Permitted Asset Swap) on a cumulative basis) basis received by the Company Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash Equivalents; andInvestments.
(3b) After the receipt of Net Available Cash from an Asset Disposition, the Borrower or a Restricted Subsidiary, as the case may be, may apply such Net Available Cash directly or indirectly (at the option of the Borrower or such Restricted Subsidiary):
(1) within 18 months 365 days (or 15 days if the Specified Gross Leverage Condition is not satisfied) from the later of (A) the date of such Asset Disposition and (B) the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company prepay, repay, purchase or redeem any Indebtedness incurred under Section 4.04(b)(1) or any Restricted SubsidiaryGuarantor Indebtedness; provided, as the case may behowever, elects (that, in connection with any prepayment, repayment or is required by the terms purchase of any IndebtednessIndebtedness pursuant to this Section 4.08(b)(1), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Borrower or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of any revolving Indebtedness) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchased; redeemed (iiiii) Obligations under unless included in Section 4.08(b)(1)(i), to prepay, repay, purchase or redeem any Pari Passu Indebtedness of the Notes Borrower or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis byGuarantor, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for price of no less more than 100% of the principal amount thereof, of such Pari Passu Indebtedness plus the amount of accrued but and unpaid interest, if any, thereon up interest to the principal amount date of Notes such prepayment, repayment, purchase or redemption, provided that the Borrower or such Guarantor, as applicable, shall prepay, redeem, repay or repurchase Guarantor Indebtedness or Pari Passu Indebtedness that is Public Debt pursuant to be repurchased this clause (which offer shall be deemed ii) only if the Borrower delivers a notice of prepayment with respect to be an Asset Disposition Offer for purposes hereofthe Pari Ratable Share of the Term Loans in accordance with Section 2.13(a)(ii) within the time period specified by this Section 4.08(b)(1) and thereafter complies with its obligations under Section 2.13(a)(iii); (iii) to prepay, repay, purchase or (iv) redeem any Indebtedness of a Restricted Subsidiary that is not a GuarantorGuarantor or any Indebtedness that is secured on assets which do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Borrower or a Guarantor or Indebtedness owed to the Company Borrower or another any Restricted Subsidiary;); or (iv) to prepay the Loans in full pursuant to Section 2.12; or (v) to redeem, repurchase or otherwise discharge the Borrower's $750 million aggregate principal amount of 5.25% Senior Notes due 2024 and 5.25% Series B Senior Notes due 2024.
(ii2) to the extent the Company Borrower or any such Restricted Subsidiary elects, to invest in or purchase or commit to invest in or purchase Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company Borrower or another Restricted Subsidiary)) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such investment or commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment invest is consummated within 180 days of such 365th day;
(3) to make a capital expenditure within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that any such capital expenditure made pursuant to a definitive binding agreement or a commitment (an “Acceptable Commitment”)approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as such investment is consummated within 180 days of such 365th day; or
(iii4) any combination of the foregoing; provided that clauses (1) – (3) of Section 4.08(b), provided that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clauses (1), (2), (3) or (4) of Section 3.54.08(b), the Company or Borrower and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and Agreement; provided, further, that the foregoing clauses (2) the Company and (3), or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash attributable to any given Asset Disposition combination of clauses (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, execution of a definitive agreement for the relevant Asset Disposition, and consummation of the relevant Asset Disposition2) and deem the amount so invested to be applied pursuant to and in accordance with clause (ii) above with respect to such Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”3), then, subject to shall only be available if the limitations with respect to Foreign Dispositions set forth below, the Company shall make an offer (an “Asset Disposition Offer”) no later than 10 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 accreted value thereof, if less), 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 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 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) Specified Gross Leverage Condition 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zerosatisfied.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof4.08(a)(2), the following will be deemed to be cash:
(1) the assumption by the transferee (or other extinguishment in connection with the transactions relating to such Asset Dispositions) of Indebtedness or and any other liabilities, contingent or otherwise liabilities (as recorded on the balance sheet of the Company Borrower or a any Restricted Subsidiary 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 Borrower’s or such Restricted Subsidiary’s balance sheet or in the footnotes thereof 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 Borrower) of the Borrower or any Restricted Subsidiary (other than Subordinated Indebtedness of the Company Borrower or a Guarantor) and the release of the Company Borrower or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company Borrower or any Restricted Subsidiary of the Company from the transferee that are converted by the Company Borrower or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Borrower and each other Restricted Subsidiary (as applicable) are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Borrower or a Guarantor (other than Subordinated Indebtedness) received after the Effective Date from Persons who are not the Borrower or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company Borrower or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 4.08 that is at that time outstanding, not to exceed (at the time of the receipt of such Designated Non-Cash Consideration, or, at the Borrower’s option, at the time of contractually agreeing to such Asset Disposition) the greater of (a) $100.0 1,040 million and (b) 7.525% of LTM L2QA Pro Forma EBITDA (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received or, at the option of the Borrower, on the date of contractually agreeing to the relevant Asset Disposition and without giving effect to subsequent changes in value).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Credit Agreement (Altice USA, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)) with a purchase price in excess of the greater of $100.0 million and 7.5% of LTM EBITDA, at least 75% of the consideration from such Asset Disposition (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Escrow Release Date (on a cumulative basis) ), received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 450 days from the later of (A) the date 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 the Applicable Percentage of such Net Available Cash (the “Applicable Proceeds”) is applied:
(i) to the extent the Company Issuer or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (A) to prepay, repay or purchase any Indebtedness of a Non-Guarantor or that is secured by a Lien (i) Obligations under a Debt Facility in each case, other than Indebtedness owed to the extent such Obligations were Incurred under clause (1Issuer or any Restricted Subsidiary) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility the Credit Agreements (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of ); provided, however, that, in connection with such Asset Disposition constituted “borrowing base assets”any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Issuer or Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iiiB) Obligations under the Notes to prepay, repay or any other Indebtedness (other than Subordinated purchase Pari Passu Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (BC) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to ), redeem the Notes as provided under Section 5.7 or purchase their the Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); through open-market purchases or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiaryin privately negotiated transactions;
(ii) to the extent the Company Issuer or any Restricted Subsidiary elects, 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 equal to Subsidiary) or invest (including capital expenditures) in any one or more business, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryIssuer); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event that any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Issuer or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company Issuer or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit FacilitiesAgreements) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company Issuer (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iib) above with respect to such Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of $60.0 200.0 million and 15.0% of LTM EBITDA (such amount of Net Available Cash Applicable Proceeds that are less than or equal to the greater of $60.0 million200.0 million and 15.0% of LTM EBITDA, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 million200.0 million and 15.0% of LTM EBITDA, “Excess Proceeds”), then, then subject to the limitations with respect to Foreign Dispositions set forth below, the Company Issuer shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 Issuer may satisfy the foregoing obligation with respect to the Net Available Cash Applicable Proceeds 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 Applicable Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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 Issuer may include any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company Issuer shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero.
(cd) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than U.S. dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in U.S. dollars that is actually received by the Issuer upon converting such portion into U.S. dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulationlaw, applicable organizational documents or agreements or other impediments will not permit repatriation to the United States (the Company Issuer hereby agreeing to use reasonable efforts (as determined in the CompanyIssuer’s reasonable business judgment) to otherwise cause the applicable Foreign Subsidiary or CFC Holding Company to 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 or regulationlaw, applicable organizational documents impediments or other impediments 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 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 (5) Business Days after such repatriation could be made) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company Issuer has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the CompanyIssuer, any Restricted Subsidiary, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax tax liability, including receipt of a Tax tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Taxtax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder)Subsidiary. The non-application of any prepayment amounts as a consequence of the foregoing provisions will shall not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section 3.5(a)(2) hereof), the following will be deemed to be cash:
(1i) the assumption by the transferee of Indebtedness or other liabilities, liabilities contingent or otherwise of the Company Issuer or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company Issuer or a Guarantor) and the release of the Company Issuer or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2ii) securities, notes or other obligations received by the Company Issuer or any Restricted Subsidiary of the Company Issuer from the transferee that are converted by the Company Issuer or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3iii) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Issuer and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(iv) consideration consisting of Indebtedness of the Issuer (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Issuer or any Restricted Subsidiary; and
(4v) any Designated Non-Cash Consideration received by the Company Issuer or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 200.0 million and (b) 7.515.0% of LTM EBITDA (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).
(eg) The Company will comply with Upon the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result commencement of an Asset Disposition may Offer, the Issuer shall send, or cause to be waived sent, electronically or modified 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:
(1) that the Asset Disposition Offer is being made pursuant to this Section 3.5 and that, to the extent lawful, all Notes tendered and not withdrawn shall be accepted for payment (unless prorated);
(2) the Asset Disposition payment amount, the Asset Disposition offered price, and the date on which Notes tendered and accepted for payment shall be purchased, which date shall be at least 30 days and not later than 60 days from the date such notices is mailed (the “Asset Sale Payment Date”);
(3) that any Notes not tendered or accepted for payment shall continue to accrue interest in accordance with the written consent terms thereof;
(4) that, unless the Issuer defaults in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrue interest on and after the Asset Sale Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to any Asset Disposition Offer shall be required to surrender the Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice at least 3 Business Days before the Asset Sale Payment Date;
(6) that Holders shall be entitled to withdraw their election if the Paying Agent receives, not later than 2 Business Days prior to the Asset Sale Payment Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a majority in statement that such Holder is withdrawing its election to have such Note purchased;
(7) that if the aggregate principal amount of Notes surrendered by Holders exceeds the then Asset Disposition payment amount, the Issuer shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Issuer so that only Notes in denominations of $2,000 or integral multiples of $1,000 remain outstanding Notesafter purchase); and
(8) 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).
(h) If the Asset Sale Payment Date is on or after a record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is r
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Board of Directors of the Company, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basisthan Indebtedness) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash EquivalentsInvestments; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt 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 extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is appliedbe:
(iA) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any IndebtednessIndebtedness of a Restricted Subsidiary), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay or purchase any Indebtedness of a non-Guarantor Restricted Subsidiary (in each case, other than Indebtedness owed to the Company or a Guarantor any Restricted Subsidiary) or Indebtedness under the Senior Facilities Agreement (or any Refinancing Indebtedness in respect thereof) within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that, in the case connection with any prepayment, repayment or purchase of revolving obligationsIndebtedness pursuant to this clause (a), to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of the Senior Facilities Agreement) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiii) Obligations under the Notes to prepay, repay or any other purchase Pari Passu Indebtedness (other at a price of no more than Subordinated Indebtedness) 100% of the Company principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest to the date of such prepayment, repayment or any Restricted Subsidiarypurchase; provided that the Company shall redeem, repay or repurchase Pari Passu Indebtedness pursuant to this clause (ii) only if the Company makes (at such time or any Restricted Subsidiary shall so repay any senior Indebtedness other than subsequently in compliance with this Section 4.09) an offer to the Notes, the Company will either (1) reduce Obligations under Holders of the Notes on a pro rata basis by, at its option, (A) redeeming to purchase their Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures provisions set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness Offer for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the an aggregate principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed at least equal to the Company or another Restricted Subsidiary;proportion that (x) the total aggregate principal amount of Notes outstanding bears to (y) the sum of the total aggregate principal amount of Notes outstanding plus the total aggregate principal amount outstanding of such Pari Passu Indebtedness; or
(iiB) to the extent the Company or any such Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company or another Restricted Subsidiary); ) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash, provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Company that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment investment is consummated within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing365th day; provided that (1) that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with Section 3.54.09(a)(3)(A) or 4.09(a)(3)(B), the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and Indenture.
(2b) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Any Net Available Cash attributable from Asset Dispositions that is not applied or invested or committed to any given Asset Disposition (be applied or invested as provided that such investment shall in Section 4.09(a) will be made no earlier than deemed to constitute “Excess Proceeds” under this Indenture. On the earliest of written notice to the Trustee of the relevant 366th day after an Asset Disposition, execution of a definitive agreement for if 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such aggregate amount of Net Available Cash that are less than or equal to $60.0 Excess Proceeds under this Indenture exceeds €50 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject the Issuers will be required to the limitations with respect to Foreign Dispositions set forth below, the Company shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders holders of Notes and, if required by to the terms of any Pari Passu Indebtednessextent the Issuers elect, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer priceprice in respect of the Notes in an amount equal to (and, in the case of the Notesany Pari Passu Indebtedness, in cash in an amount equal to offer price of no more than) 100% of the principal amount thereof (or accreted value thereofof the Notes and 100% of the principal amount of Pari Passu Indebtedness, if less)in each case, 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 offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and in case of the Euro Notes in minimum denominations of €50,000 and in integral multiples of €1,000 in excess thereof or, in case of the Dollar Notes in minimum denominations of $2,000 75,000 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 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.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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 OfferExcess Proceeds, the Company Issuers may include use any remaining Excess Proceeds (orfor general corporate purposes, subject to other covenants contained in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 issued surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (orProceeds, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; provided . For the purposes of calculating the principal amount of any such Indebtedness not denominated in euro, such Indebtedness shall be calculated by converting any such principal amounts into their Euro Equivalent determined as of a date selected by the Issuers that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denominationis within the Asset Disposition Offer Period (as defined below). Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(cd) Notwithstanding any other provisions Any Net Available Cash payable in respect of this the Notes pursuant to Section 3.5,
(i) 4.09 will be apportioned between the Euro Notes and the Dollar Notes in proportion to the respective aggregate principal amounts of Euro Notes and Dollar Notes validly tendered and not withdrawn, based upon the Euro Equivalent of such principal amount of Dollar Notes determined as of a date selected by the Issuers that is within the Asset Disposition Offer Period. To the extent that any portion of or all the Net Available Cash payable in respect of any 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 Issuers upon converting such portion into such currency.
(e) The Asset Disposition by Offer, in so far as it relates to the Notes, will remain open for a Foreign Subsidiary or a CFC Holding Company period of not less than 20 Business Days following its commencement (a the “Foreign DispositionAsset Disposition Offer Period”). No later than five Business Days after the termination of the Asset Disposition Offer Period (the “Asset Disposition Purchase Date”) is (x) prohibited or delayed by applicable local lawthe Issuers will purchase the principal amount of Notes and, (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 Statesextent they elect, the portion of such Net Available Cash so affected will not be Pari Passu Indebtedness required to be applied in compliance with purchased pursuant to this Section 3.54.09 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(f) On or before the Asset Disposition Purchase Date, the Issuers 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 Indebtedness or portions of Notes 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 Notes and Pari Passu Indebtedness so validly tendered and not properly withdrawn and, in the case of Euro Notes, in minimum denominations of €50,000 and in integral multiples of €1,000 in excess thereof or, in the case of the Dollar Notes, in minimum denominations of $75,000 and in integral multiples of $1,000 in excess thereof. The Company will deliver to the Trustee an Officer’s Certificate stating that such amounts may be retained Notes or portions thereof were accepted for payment by the applicable Foreign Subsidiary Company in accordance with the terms of this Section 4.09. The Company or CFC Holding Company so long, but only so longthe Paying Agent, as the applicable local law or regulationcase may be, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and such repatriated Net Available Cash will be promptly (and but in any event case not later than five Business Days after such repatriation could be madetermination of the Asset Disposition Offer Period) applied (net mail or deliver to each tendering Holder of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
(ii) Notes an amount equal to the extent that purchase price of the Notes so validly tendered and not properly withdrawn by such Holder, and accepted by the Company has determined in good faith that repatriation offor purchase, and the Company will promptly issue a new Note (or amend the applicable Global Note), and the Trustee, upon delivery of an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so Officer’s Certificate from the Company, will authenticate and mail or deliver (or cause to be transferred by book entry) such new Note to such Holder, in a principal amount equal to any Restricted Subsidiary, unpurchased portion of the Note surrendered; provided that each such new Note will be in a principal amount with a minimum denomination of €50,000 in the case of Euro Notes and $75,000 in the case of Dollar Notes. Any Note not so accepted will be promptly mailed or any of their respective Affiliates and/or direct delivered (or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained transferred by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require book entry) by the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of DefaultHolder thereof.
(dg) For the purposes of Section 3.5(a)(2) hereof4.09(a)(2), the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or Indebtedness of a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 4.09 that is at that time outstanding, not to exceed the greater of (a) $€100.0 million and (b) 7.51% of LTM EBITDA Total Assets (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).
(eh) The Company Issuers will comply comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to (or rules of any exchange on which the extent those laws and regulations Notes are applicable then listed) in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Indenture. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations (or exchange rules) conflict with the provisions of this IndentureSection 4.09, the Company will comply with the applicable securities laws, rules laws and regulations (or exchange rules) and shall will not be deemed to have breached its obligations described in under this Indenture by virtue thereofof any conflict.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Senior Secured Indenture (NXP Manufacturing (Thailand) Co., Ltd.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market Fair Market Value (including as to the value (such fair market value to be determined on the date of contractually agreeing to such Asset Dispositionall non-cash consideration) of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap)Disposition;
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), 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 this clause (including by way 2) shall not apply to the sale or other disposition of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwisethe Company's diagnostic division; and
(3) an amount equal to 100% of the Net Available Cash from such Asset Disposition, together with all other than any Asset Dispositions since Disposition that constitutes (i) a Syndication or a resyndication transaction in the Issue Date ordinary course of business or (on ii) a cumulative basis) received Specified Sale/Leaseback Transaction, is applied by the Company (or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and)
(3) within 18 months from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay, redeem or purchase Senior Indebtedness of the Company or a Subsidiary Guarantor or Indebtedness (other than any Disqualified Stock) of a Restricted Subsidiary that is not a Subsidiary Guarantor (and in each case other than Indebtedness owed to the case Company or an Affiliate of revolving obligationsthe Company) within one year from the later of the date of such Asset Disposition or the receipt of such Net Available Cash;
(B) to the extent the Company elects (including with respect to the balance of such Net Available Cash after application (if any) in accordance with clause (A)), to correspondingly reduce commitments 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) to the extent of the balance of such Net Available Cash after application (if any) in accordance with respect theretoclauses (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 contained in this Indenture; provided provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness made to satisfy clause (A) or (C) above, the Company or such Restricted Subsidiary will shall permanently retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will 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; (iii) Obligations under . Notwithstanding the Notes or any other Indebtedness (other than Subordinated Indebtedness) foregoing provisions of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notesthis Section 4.06, the Company will either (1) reduce Obligations under and the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may Restricted Subsidiaries shall not be below par), or (2) make an offer (required to apply any Net Available Cash in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) this Section 4.06 except to the extent that the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of aggregate Net Available Cash from the date of such commitment all Asset Dispositions which is not applied in accordance with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final this Section 4.06 exceeds $20,000,000. Pending 50 application of the amount of any such Net Available Cash pursuant to this Section 3.54.06, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Dispositionindebtedness. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of this Section 3.5(a)(2) hereof4.06, the following will be are deemed to be cashcash or cash equivalents:
(1) the assumption by or discharge of any liabilities (as shown on the transferee of Indebtedness Company's or other liabilities, contingent such Restricted Subsidiary's most recent balance sheet or otherwise of in the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantorfootnotes thereto) and the release of the Company or such Restricted Subsidiary from (other than liabilities that are by their terms subordinated to the Securities) that are assumed by the transferee of such assets and for which the Company and all liability on such Indebtedness or other liability of the Restricted Subsidiaries have been released by all creditors in connection with such Asset Dispositionwriting;
(2) securities, notes or other obligations securities received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary within 180 days into cash or Cash Equivalentscash, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), received in each case, within 180 days following the closing of such Asset Dispositionthat conversion;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Dispositionall Temporary Cash Investments; and
(4) any Designated Non-Cash Noncash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueFair Market Value that, when taken together with all other Designated Non-Cash Noncash Consideration previously received pursuant to this Section 3.5 that is at that time and then outstanding, does not to exceed at the greater time of (a) $100.0 million and (b) 7.5% the receipt of LTM EBITDA such Designated Noncash Consideration (with the fair market value Fair Market Value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value) $30,000,000.
(b) In the event of an Asset Disposition that requires the purchase of Securities (and other Senior Indebtedness of the Company) pursuant to Section 4.06(a)(3)(C), the Company shall purchase Securities tendered pursuant to an offer 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 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 other Senior Indebtedness of the Company, such lesser price, if any, as may be provided for by the terms of such Senior Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture. 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 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 4.06 if the Net Available Cash available therefor is less than $20,000,000 (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 an Offer, Net Available Cash shall be deemed to be reduced by the aggregate amount of such Offer.
(i) 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").
(eii) 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 included in the Offer for repurchase, (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). By 11:00 a.m. New York City time on the Purchase Date, the Company shall irrevocably deposit with the Trustee or with a Paying Agent (or, if the Company or a Wholly Owned Subsidiary is acting as Paying Agent, segregate and hold in trust) an amount equal to the Offer Amount 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 which 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 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.
(iii) 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. A Holder shall be entitled to withdraw its 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 such Holder, the principal amount of the Security that was delivered for purchase by such Holder and a statement that such Holder 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 unpurchased portion of the Securities surrendered.
(iv) 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 Securities are to be accepted by the 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 time the Trustee, directly or through an agent, mails or delivers payment therefor to the surrendering Holder.
(d) The Company will comply shall comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.this
Appears in 1 contract
Sources: Indenture (Healthsouth Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company Holdings shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Holdings or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Holdings, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 7575.0% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Existing Secured Notes Issue Date (on a cumulative basis) (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company Holdings or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 as set forth belowCommitment, the “Proceeds Application Period”), an amount equal to the Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company Holdings or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay elects:
(i) Obligations under a Debt Facility (x) to the extent such Net Available Cash is from an Asset Disposition of Collateral, (A) to reduce, prepay, repay or purchase any First Lien Obligations were Incurred (other than the Notes), including Indebtedness under the First Lien Credit Agreement (or any Refinancing Indebtedness in respect thereof); provided, however, that, to the extent Holdings or the Company reduces, prepays, repays or purchases such First Lien Obligations pursuant to this clause (1A), the Company shall equally and ratably reduce Obligations under the Notes pursuant to Section 5.7 through open market purchases or in privately negotiated transactions or by making an offer (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer) to all Holders to purchase their Notes at 100% of the second paragraph under Section 3.2 principal amount thereof, plus the amount of accrued but unpaid interest, if any, on the amount of Notes that would otherwise be prepaid, (and B) to make an offer (in accordance with the case of revolving obligationsprocedures set forth below for a Collateral Asset Disposition Offer), to correspondingly reduce commitments with respect theretoredeem Notes pursuant to Section 5.7 or to purchase Notes through open market purchases or in privately negotiated transactions, or (C) to reduce, prepay, repay or purchase any Indebtedness of a Non-Guarantor Subsidiary (in each case, other than Indebtedness owed to Holdings or any Restricted Subsidiary); provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligationsi)(x), to correspondingly reduce commitments with respect thereto); provided that the Company Holdings or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided provided, further, that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an such offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their any Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereofis made, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (repaid to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing amount of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result offer, whether or not accepted by the holders of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset DispositionNotes; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Wayfair Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Borrower will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Borrower or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 an Officer or the Board of Directors of the Borrower, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);; and
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition or such series of related Asset Dispositions (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, other than Indebtedness), together with all other Asset Dispositions since the Issue IssueEffective Date (except to the extent any such Asset Disposition was a Permitted Asset Swap) on a cumulative basis) basis received by the Company Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash Equivalents; andInvestments.
(3b) After the receipt of Net Available Cash from an Asset Disposition, the Borrower or a Restricted Subsidiary, as the case may be, may apply such Net Available Cash directly or indirectly (at the option of the Borrower or such Restricted Subsidiary):
(1) within 18 months 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company prepay, repay, purchase or redeem any Indebtedness incurred under Section 4.04(b)(1) or any Restricted SubsidiaryGuarantor Indebtedness; provided, as the case may behowever, elects (that, in connection with any prepayment, repayment or is required by the terms purchase of any IndebtednessIndebtedness pursuant to this Section 4.08(b)(1), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Borrower or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of any revolving Indebtedness) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchasedredeemed; (iiiii) Obligations under unless included in Section 4.08(b)(1)(i), to prepay, repay, purchase or redeem any Pari Passu Indebtedness of the Notes Borrower or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis byGuarantor, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for price of no less more than 100% of the principal amount thereof, of such Pari Passu Indebtedness plus the amount of accrued but and unpaid interest, if any, thereon up interest to the principal amount date of Notes such prepayment, repayment, purchase or redemption, provided that the Borrower or such Guarantor, as applicable, shall prepay, redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to be repurchased this clause (which offer shall be deemed ii) only if the Borrower delivers a notice of prepayment with respect to be an Asset Disposition Offer for purposes hereofthe Pari Ratable Share of the Term Loans in accordance with Section 2.13(a)(ii) within the time period specified by this Section 4.08(b)(1) and thereafter complies with its obligations under Section 2.13(a)(iii); (iii) to prepay, repay, purchase or (iv) redeem any Indebtedness of a Restricted Subsidiary that is not a GuarantorGuarantor or any Indebtedness that is secured on assets which do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Borrower or a Guarantor or Indebtedness owed to the Company Borrower or another any Restricted Subsidiary); or (iv) to prepay the Loans in full pursuant to Section 2.12;
(ii2) to the extent the Company Borrower or any such Restricted Subsidiary elects, to invest in or purchase or commit to invest in or purchase Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company Borrower or another Restricted Subsidiary)) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such investment or commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment invest is consummated within 180 days of such 365th day;
(3) to make a capital expenditure within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that any such capital expenditure made pursuant to a definitive binding agreement or a commitment (an “Acceptable Commitment”)approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as such investment is consummated within 180 days of such 365th day; or
(iii4) any combination of the foregoing; provided that clauses (1) — (3) of Section 4.08(b), provided that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clauses (1), (2), (3) or (4) of Section 3.54.08(b), the Company or Borrower and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zeroAgreement.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof4.08(a)(2), the following will be deemed to be cash:
(1) the assumption by the transferee (or other extinguishment in connection with the transactions relating to such Asset Dispositions) of Indebtedness or and any other liabilities, contingent or otherwise liabilities (as recorded on the balance sheet of the Company Borrower or a any Restricted Subsidiary 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 Borrower’s or such Restricted Subsidiary’s balance sheet or in the footnotes thereof 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 Borrower) of the Borrower or any Restricted Subsidiary (other than Subordinated Indebtedness of the Company Borrower or a Guarantor) and the release of the Company Borrower or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company Borrower or any Restricted Subsidiary of the Company from the transferee that are converted by the Company Borrower or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Borrower and each other Restricted Subsidiary (as applicable) are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Borrower or a Guarantor (other than Subordinated Indebtedness) received after the IssueEffective Date from Persons who are not the Borrower or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company Borrower or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 4.08 that is at that time outstanding, not to exceed (at the time of the receipt of such Designated Non-Cash Consideration, or, at the Borrower’s option, at the time of contractually agreeing to such Asset Disposition) the greater of (a) $100.0 2401,040 million and (b) 7.51025% of LTM L2QA Pro Forma EBITDA (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received or, at the option of the Borrower, on the date of contractually agreeing to the relevant Asset Disposition and without giving effect to subsequent changes in value).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Credit Agreement (Altice USA, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
(1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value, as determined in good faith by the Board of Directors (including as to the value (such fair market value to be determined on the date of contractually agreeing to such Asset Disposition) all non-cash consideration), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), and at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalents; , and
(3ii) the Company (x) within 18 months from 180 days (in the later case of (A) below) or 360 days (in the date case of such Asset Disposition and (B) the below) after receipt of the such Net Available Cash from such Asset Disposition Cash, (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(iA) to the extent the Company or any Restricted Subsidiary, as the case may be, so elects (or is so required by the terms of any IndebtednessSenior Debt), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 applies an amount equal to 100% of the Net Available Cash to repay, prepay, redeem or purchase Senior Debt of the Company or ▇▇▇▇ or Debt (other than any Disqualified Stock) of a Wholly Owned Subsidiary of ▇▇▇▇ (in each case other than Debt owed to the Company or an Affiliate of the Company) or (B) invests or commits to invest the balance of such Net Available Cash not applied pursuant to clause (A), in Additional Assets; provided, however, that in the case of any commitment to invest such investment must be made within one month thereafter, and any amount not so invested shall be treated as Excess Proceeds (as defined below); and (y) applies the balance of such Net Available Cash not applied pursuant to clause (x), as provided in the following paragraphs of this covenant. Notwithstanding the foregoing provisions of this paragraph, the Company and its Subsidiaries shall not be required to apply any Net Available Cash in accordance with this paragraph except to the extent that the aggregate Net Available Cash from all Asset Dispositions which are not applied in accordance with this paragraph exceeds $10 million. The amount of Net Available Cash required to be applied and not applied as so required shall constitute "Excess Proceeds". Pending application of Net Available Cash pursuant to this covenant, such Net Available Cash shall be invested in Temporary Cash Investments or applied to repay Debt Incurred under the Revolving Credit Facility without commitment reduction thereunder. For the purposes of this covenant, the following are deemed to be included in Cash Equivalents: (x) the assumption of Debt of the Company or any Subsidiary and the release of the Company or such Subsidiary from all liability on such Debt in connection with such Asset Disposition, (y) Temporary Cash Investments, and (z) securities received by the Company or any Subsidiary from the transferee that are promptly converted by the Company or such Subsidiary into cash.
(b) If, as of the first day of any calendar month, the aggregate amount of Excess Proceeds not theretofore subject to an Excess Proceeds Offer (as defined below) totals at least $10 million, the Company must, not later than the fifteenth Business Day of such month, make an offer (an "Excess Proceeds Offer") to purchase from the Holders (and to purchase Debt from the holders of any other Senior Subordinated Debt) on a pro rata basis an aggregate principal amount thereof of Notes equal to the Excess Proceeds (or accreted value thereofrounded down to the nearest multiple of $1,000) on such date, at a purchase price equal to 100% of the principal amount of such Notes, plus, in each case, accrued interest (if less)any) to the date of purchase (or, plus accrued and unpaid interestin respect of such other Senior Subordinated Debt, if any (or such lesser price with respect to Pari Passu Indebtednessprice, if any, as may be provided for 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 by making an Asset Disposition Offer prior to the expiration of the Proceeds Application Period Senior Subordinated Debt) (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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance PortionPayment"), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding The Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Dispositioncomply, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market valueapplicable, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereofSection 5.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Goss Holdings Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) Disposition received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 450 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (a) to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase any Indebtedness of a Non-Guarantor Subsidiary (in each case, other than Indebtedness owed to the Company or a Guarantor any Restricted Subsidiary) or any Secured Indebtedness, including Indebtedness under the New Revolving Credit Facility (and or any Refinancing Indebtedness in the case of revolving obligations, to correspondingly reduce commitments with respect theretothereof that is Secured Indebtedness); provided that provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiii) Obligations under to prepay, repay or purchase Pari Passu Indebtedness; provided further that, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) of extent the Company redeems, repays or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior repurchases such Indebtedness other than the Notespursuant to this clause (ii), the Company will either (1) shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 5.7 through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted SubsidiarySubsidiary and including payment of milestone, earnout and similar payments with respect to Additional Assets); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior New Revolving Credit FacilitiesFacility) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 10.0 million (such amount of Net Available Cash that are less than or equal to $60.0 10.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 10.0 million, “Excess Proceeds”), then, 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 10 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 10.0 million and (b) 7.520.0% of LTM EBITDA (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).
(e6) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f7) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Harrow, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), with a purchase price in excess of the greater of $150.0 million and 15.0% of LTM EBITDA, at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Completion Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash EquivalentsEquivalents (which determination may be made by the Company, at its option, either (x) on the date of contractually agreeing to such Asset Disposition or (y) at the time the Asset Disposition is completed); and
(3) within 18 months 365 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the such Net Available Cash is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects elects:
(or is required by the terms of any Indebtedness), to repay (ia) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause Net Available Cash are from an Asset Disposition of Collateral, (1w) of the second paragraph under Section 3.2 (and in the case of revolving obligationsto reduce, to correspondingly reduce commitments with respect thereto); (ii) prepay, repay or purchase any First Lien Obligations under Secured the New Exit Revolving Facility (or any Refinancing Indebtedness of in respect thereof) or any other First Lien Obligations, in each case with senior payment priority to the Company Notes pursuant to the First Lien Intercreditor Agreement or a Guarantor any other intercreditor agreement or any Refinancing Indebtedness in respect thereof, (x) to reduce, prepay, repay or purchase any First Lien Obligations (other than the Notes and the New Exit Revolving Facility), including Indebtedness under the Credit Agreement (or any Refinancing Indebtedness in the case of revolving obligations, to correspondingly reduce commitments with respect theretothereof); provided that the Company ratably offer to repurchase Notes (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer or Asset Disposition Offer), redeem Notes as described under Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, (y) to make an offer (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer or Asset Disposition Offer), redeem Notes as described under Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (z) to reduce, prepay, repay or purchase any Indebtedness of a Non-Guarantor (in each case, other than Indebtedness owed to the Company or any Restricted Subsidiary); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased;
(b) to the extent such Net Available Cash is from an Asset Disposition that does not constitute Collateral, (w) to reduce, prepay, repay or purchase any Indebtedness secured by a Lien on such asset, (x) to reduce, prepay, repay or purchase senior Indebtedness; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of provided, that the Company ratably offer to repurchase Notes (in accordance with the procedures set forth below for a Collateral Asset Disposition Offer or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the NotesAsset Disposition Offer), the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming redeem Notes as described under Section 5.6 Section 5.7 or (B) purchasing purchase Notes through open-market purchases or in arm’s-length privately negotiated transactions transactions, (which, in each case, may be below par), or (2y) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer), redeem Notes as described under Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (z) to all Holders to reduce, prepay, repay or purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) any Indebtedness of a Restricted Subsidiary that is not a GuarantorNon-Guarantor (in each case, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application that, in connection with any reduction, prepayment, repayment or purchase of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Indebtedness pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”b), 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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on 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 other liability otherwise disposed of in connection with such Asset Disposition;
(2Disposition constituted “borrowing base assets”) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (reduced in an amount equal to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.so reduced, prepaid, repaid or purchased;
Appears in 1 contract
Sources: Indenture (Windstream Parent, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Board of Directors of the Company, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)) with a purchase price in excess of the greater of $75 million and 2.0% of Total Assets, at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 450 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects elects:
(or is required by the terms of any Indebtedness), to repay a) (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay or purchase any Indebtedness of a Non-Guarantor or that is secured by a Lien (in each case, other than Indebtedness owed to the Company or a Guarantor any Restricted Subsidiary) or Indebtedness under the Existing Credit Agreement (and or any Refinancing Indebtedness in the case of revolving obligations, to correspondingly reduce commitments with respect theretothereof); provided that provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iiiii) Obligations under to make an offer (in accordance with the Notes or any other Indebtedness (other than Subordinated Indebtednessprocedures set forth below for an Asset Disposition Offer) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming to redeem Notes as described under in Section 5.6 5.7 or (B) purchasing purchase Notes through open-market purchases or in arm’s-length privately negotiated transactions transactions; or (whichiii) to prepay, in each caserepay or purchase Pari Passu Indebtedness; provided further that, may be below parto the extent the Company redeems, repays or repurchases Pari Passu Indebtedness pursuant to this clause (iii), the Company shall equally and ratably reduce Obligations under the Notes as provided under Section 5.7, through open-market purchases (to the extent such purchases are at or (2above 100% of the principal amount thereof) make or by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;or
(iib) to the extent the Company or any Restricted Subsidiary elects, (i) to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to Subsidiary), properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Company that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment investment is consummated within 180 days of such commitment 450th day (an the “Acceptable Applicable Commitment”); or
(iiic) any combination of the foregoing; provided that that, (1) pending the final application of the amount of any such amounts equal to Net Available Cash pursuant to this Section 3.5in accordance with clause (a) or clause (b) above, the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture (and elect not to have such use count as a use of cash set forth in clauses (a) and (b) above) and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iib) above with respect to such Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of $60.0 50.0 million and 1.5% of Total Assets (such amount of Net Available Cash Applicable Proceeds that are less than or equal to the greater of $60.0 million50.0 million and 1.5% of Total Assets, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 million50.0 million and 1.5% of Total Assets, “Excess Proceeds”), then, 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 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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, and, with respect to the Notes, 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 obligations with respect to the Net Available Cash Applicable Proceeds 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 Applicable Proceeds (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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Primo Water Corp /CN/)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Issuer will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
: (1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 an Officer or the Board of Directors of the Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
; and (2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition or such series of related Asset Dispositions (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, other than Indebtedness), together with all other Asset Dispositions since the Issue Date (except to the extent any such Asset Disposition was a Permitted Asset Swap) on a cumulative basis) basis received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash Equivalents; andInvestments.
(3b) After the receipt of Net Available Cash from an Asset Disposition, the Issuer or a Restricted Subsidiary, as the case may be, may apply such Net Available Cash directly or indirectly (at the option of the Issuer or such Restricted Subsidiary): (1) within 18 months 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company prepay, repay, purchase or redeem any Restricted SubsidiarySenior Secured Indebtedness incurred under Section 4.04(b)(1); provided, as the case may behowever, elects that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (or is required by the terms of any Indebtednessi), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Issuer or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of any revolving Indebtedness) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchasedredeemed; (iiiii) Obligations under unless included in this clause (i), to prepay, repay, purchase or redeem any Pari Passu Indebtedness of the Issuer or a Subsidiary Guarantor that is secured in whole or in part by a Lien on the Notes or any other Indebtedness Collateral (other than Subordinated Indebtedness) including by virtue of the Company Intercreditor Agreement or any Restricted Subsidiaryan Additional Intercreditor Agreement), which Lien ranks pari passu with the Liens securing the Notes, at a price of no more than 100% of the principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest to the date of such prepayment, repayment, purchase or redemption; provided that the Issuer or such Subsidiary Guarantor, as applicable, shall prepay, redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to this clause (ii) only if the Company Issuer or any Restricted such Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes Guarantor purchases through open-market purchases at a price equal to or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less higher than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up or makes an offer to the principal amount Holders of the Notes to be repurchased (which offer shall be deemed purchase their Notes at a purchase price in cash equal to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness at least 100% of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;principal 89 EU-DOCS\26039728.6
(iic) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Any Net Available Cash from Asset Dispositions that is not applied or invested or committed to be applied or invested as provided in Section 4.08(b) will be deemed to constitute “Excess Proceeds.” On the 366th day (or the 546th day, in the case of any Net Available Cash committed to be used pursuant to a definitive binding agreement or commitment approved by the Board of Directors of the Issuer pursuant to clause (2) or (3) of Section 4.08(b)) after the later of (A) the date of such commitment with Asset Disposition and (B) the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days receipt of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5Cash, if the aggregate amount of Excess Proceeds exceeds $50 million, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily Issuer will be required within ten (10) Business Days thereof to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 Business Days after the expiration to all holders of the Proceeds Application Period to all Holders of Notes and, if to the extent the Issuer or a Subsidiary Guarantor elects or the Issuer or a Subsidiary Guarantor is required by the terms of any other outstanding Pari Passu Indebtedness, to all holders of such other outstanding Pari Passu Indebtedness, Indebtedness to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer priceprice in respect of the Notes in an amount equal to (and, in the case of the Notesany Pari Passu Indebtedness, in cash in an amount equal to offer price of no more than) 100% of the principal amount thereof (or accreted value thereofof such Notes and 100% of the principal amount of Pari Passu Indebtedness, if less)in each case, 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 offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and in the case of the Notes, 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 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.90 EU-DOCS\26039728.6
(bd) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to an Asset Disposition Offer made with is less than the 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 Issuer and the Restricted Subsidiaries may include use any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceedsfor general corporate purposes, and use such Declined Excess Proceeds for any purpose to the extent not otherwise prohibited by the other covenants contained in 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 surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; provided . For the purposes of calculating the principal amount of any such Indebtedness not denominated in dollars, such Indebtedness shall be calculated by converting any such principal amounts into their Dollar Equivalent determined as of a date selected by the Issuer that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denominationis within the Asset Disposition Offer Period (as defined below). Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions , and in the case of this Section 3.5,
(i) to an Advance Offer, the extent that any amount of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (a “Foreign Disposition”) the Issuer is (x) prohibited or delayed by applicable local law, (y) restricted by applicable organizational documents or any agreement or (z) subject offering to other onerous organizational or administrative impediments from being repatriated to the United States, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary apply in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater Advance Offer shall be excluded in subsequent calculations of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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)Excess Proceeds.
(e) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than dollars, the amount thereof payable in respect of the Notes shall not exceed the net Dollar Equivalent of the amount that is actually received by the Issuer.
(f) The Company Asset Disposition Offer, in so far as it relates to the Notes, will remain open for a period of not less than 20 Business Days following its commencement or such shorter period of time required to comply with the requirements Section 14(e) of Rule 14e-1 under the Exchange Act and any other applicable securities laws and or regulations thereunder in connection with the Asset Disposition Offer (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 those laws and regulations are applicable in connection with each repurchase of Notes it elects, Pari Passu Indebtedness required to be purchased by it pursuant to an this Section 4.08 (the “Asset Disposition Offer Amount”) or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Notes and Pari Passu Indebtedness validly tendered in response to the Asset Disposition Offer.
(g) On or Advance before the Asset Disposition Purchase Date, the Issuer 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 Indebtedness or portions of Notes and Pari Passu Indebtedness so validly tendered and not properly withdrawn pursuant to the Asset Disposition Offer, as or if less than the Asset Disposition Offer Amount has been validly tendered and not properly withdrawn, all Notes and Pari Passu Indebtedness so validly tendered and not properly withdrawn and, in the case may be. To of the extent that the provisions Notes, in minimum denominations of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions $200,000 and in integral multiples of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described $1,000 in this Indenture by virtue excess thereof.
(fh) The provisions Issuer will deliver to the Trustee an Officer’s Certificate stating that such Notes or portions thereof were accepted for payment by the Issuer in accordance with the terms of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding NotesSection 4.
Appears in 1 contract
Sources: Indenture (Sothebys)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries restricted Subsidiary to, make directly or indirectly, sell, transfer or otherwise dispose of (collectively, a "disposition") any Asset Disposition Capital Stock of any Person that owns, directly or indirectly, all or a significant portion of the Tubular Business, unless:
(1i) the Company or such Restricted Subsidiary receives consideration at the time of such 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 Capital Stock subject to such disposition;
(ii) at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents; and
(iii) an amount equal to 75% of the Net Available Cash from such disposition is applied by the Company (or such Restricted Subsidiary, as the case may be) to make an offer to the holders of the Notes to purchase Notes pursuant to and subject to the conditions contained in the Indenture within 30 days from the later of the date of such disposition or the receipt of such Net Available Cash; provided, however, that the Company or such Restricted Subsidiary shall permanently retire such Notes. Pending application of Net Available Cash pursuant to this paragraph (a), such Net Available Cash shall be invested in Temporary Cash Investments or applied to temporarily reduce indebtedness under Credit Facilities.
(b) The Company shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, consummate any other Asset Disposition unless:
(i) the Company or such Restricted Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value (such fair market including as to the value to be of all non cash consideration), as determined on in good faith by the date Board of contractually agreeing to such Asset Disposition) Directors of the Issuer of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);and
(2ii) in any such Asset Disposition, or series of related with respect to Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)other than Like-Kind Exchanges or Excluded Real Property Sales, at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary is in the form of cash or cash equivalents; 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, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay, redeem or purchase Senior Indebtedness of the Company or Indebtedness (other than any Disqualified Stock) of a Guarantor Wholly Owned 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 such Asset Disposition or the receipt of such Net Available Cash; (2) second, to the extent of the balance of such Net Available Cash after application in accordance with clause (1), 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 (3) third, to the extent of the balance of such Net Available Cash after application in accordance with clauses (1) and (2), to make an offer to the holders of the Notes (and to holders of other Senior Indebtedness of the Company designated by the Company to purchase Notes (and such other Senior Indebtedness of the Company) pursuant to and subject to the conditions contained in the case Indenture; provided, however, that in connection with any prepayment, repayment or purchase of revolving obligationsIndebtedness pursuant to clause (1) or (3) above, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will shall permanently retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will 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; (iii) Obligations under . Notwithstanding the Notes or any other Indebtedness (other than Subordinated Indebtedness) foregoing provisions of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the NotesSection 4.15(b), the Company will either (1) reduce Obligations under and the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may Restricted Subsidiaries shall not be below par), or (2) make an offer (required to apply any Net Available Cash in accordance with the procedures set forth below for an Asset Disposition OfferSection 4.15(b) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) except to the extent that the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of aggregate Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted from all Asset Dispositions which are not applied in accordance with Section 4.15(b) exceeds $25 million. Pending application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal pursuant to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”Section 4.15(b); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any , such Net Available Cash pursuant shall be invested in Temporary Cash Investments or applied to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions For the purposes of this Section 3.5,
Sections 4.15(a) and (i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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 Statesb), the portion of such Net Available Cash so affected will not be required following are deemed to be applied in compliance with this Section 3.5, and such amounts may be retained by cash or cash equivalents: (A) the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required such repatriation assumption of any Senior Indebtedness of such affected Net Available Cash is permitted under the applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, or Indebtedness of any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
; (2B) securities, notes or other obligations securities 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 or Cash Equivalents, or by their terms are required to be satisfied for cash cash; and Cash Equivalents (C) any reduction of Indebtedness Attributed to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness U. S. Steel Group in connection with such Asset Disposition; and.
(4d) any Designated Non-Cash Consideration received In the event of an Asset Disposition that requires the purchase of Notes (and other Senior Indebtedness) pursuant to Section (a)(iii) or (b) (iii)(3) above, the Company shall purchase Notes tendered pursuant to an offer by the Company for the Notes (and such other Senior Indebtedness) 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 other Senior Indebtedness, such lesser price, if any, as may be provided for by the terms of such Senior Indebtedness) in accordance with the procedures (including prorating in the event of oversubscription) set forth in the Indenture. If the aggregate purchase price of the 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 Notes will be denominations of $1,000 principal amount or any Restricted Subsidiary in multiples thereof. The Company shall not be required to make such Asset Dispositions having an aggregate fair market value, taken together with all offer to purchase Notes (and other Designated Non-Cash Consideration received Senior Indebtedness) pursuant to this Section 3.5 that 4.15(b) if the Net Available Cash available therefor is at that time outstanding, not less than $25 million (which lesser amount shall be carried forward for purposes of determining whether such an offer is required with respect to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (with the fair market value of each item of Designated Non-Net Available Cash Consideration being measured at the time received and without giving effect to from any subsequent changes in valueAsset Disposition).
(e) The Company will comply shall comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 4.15. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 4.15, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture clause by virtue thereofof its compliance with such securities laws or regulations.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Usx Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
unless (1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value, as determined in good faith by senior management for Asset Dispositions of less than $5 million and by the Board of Directors of the Company in good faith for Asset Dispositions of $5 million or more (including in each case as to the value (such fair market value to be determined on the date of contractually agreeing to such Asset Disposition) all non cash consideration), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), ii) at least 75% of the consideration thereof received by the Company or such Restricted Subsidiary is in the form of cash or Temporary Cash Investments and (including by way iii) an amount equal to 100% of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) the Net Available Cash from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received Disposition is applied by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) within 270 days from the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of the New Credit Facility or any Senior Indebtedness), to repay prepay, repay, purchase or otherwise acquire Indebtedness under the New Credit Facility or other Senior Indebtedness or Indebtedness (iother than Disqualified Stock) Obligations under of a Debt Facility Wholly Owned Subsidiary (in each case other than Indebtedness owed to the Company or an Affiliate of the Company); (B) to the extent such Obligations were Incurred under of any remaining balance of Net Available Cash after any election in accordance with clause (1) of A), to the second paragraph under Section 3.2 (and in extent the Company or such Restricted Subsidiary, as the case of revolving obligationsmay be, elects, to correspondingly reduce commitments with respect theretothe investment by the Company or any Wholly Owned Subsidiary in Additional Assets within 360 days from the receipt of such Net Available Cash (except that the Company shall be deemed to have so invested such Net Available Cash within 360 days if, within such 360 days, it has entered into a binding commitment to invest such Net Available Cash and such Net Available Cash is actually invested within 90 days thereafter); (iiC) Obligations under Secured to the extent of any remaining balance of such Net Available Cash after any election in accordance with clauses (A) and (B), to make an Offer (as defined below) to purchase Securities pursuant to and subject to the conditions set forth in paragraph (b) of this covenant within 45 days from the application of Net Available Cash in accordance with clauses (A) and (B); and (D) to the extent of any remaining balance of such Net Available Cash after election or application in accordance with clauses (A), (B) and (C), to (x) the acquisition by the Company or any Wholly Owned Subsidiary of Additional Assets, (y) the prepayment, repayment, purchase or other acquisition of Indebtedness of the Company (other than Indebtedness owed to an Affiliate of the Company and other than Disqualified Stock of the Company) or a Guarantor Indebtedness of any Restricted Subsidiary (and other than Indebtedness owed to the Company or an Affiliate of the Company) or (z) general corporate purposes; provided, however that in the case connection with any prepayment, repayment, purchase or other acquisition of revolving obligationsIndebtedness pursuant to clause (A), to correspondingly reduce commitments with respect thereto); provided that (C) or (D) above, the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the any related loan commitment or availability (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided acquired, except that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5Cash, the Company or the applicable such Restricted Subsidiaries Subsidiary may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Temporary Cash attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 Asset DispositionInvestments. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of this Section 3.5(a)(2) hereof4.6, the following will be are deemed to be cash:
: (1x) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a any Restricted Subsidiary (other than Subordinated Indebtedness of that is subordinated to the Company Securities or a Guarantorthe Subsidiary Guarantees) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
, (2y) securities, notes or other obligations securities 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 and (z) Additional Assets received in an exchange of assets transaction; provided that (i) in the event such exchange of assets transaction or Cash Equivalentsseries of related exchange of assets transactions (each an "Exchange Transaction") involves an aggregate value in excess of $2,500,000, or the terms of such Exchange Transaction shall have been approved by their terms are a majority of the disinterested members of the Board of Directors, (ii) in the event such Exchange Transaction involves an aggregate value in excess of $5,000,000, the Company shall have received a written opinion from a nationally recognized independent investment banking firm that the Company has received consideration equal to the fair market value of the assets disposed of and (iii) any assets to be received shall be comparable to those being exchanged as determined in good faith by the Board of Directors, except that up to $1,000,000 of consideration in any Exchange Transaction may consist of marketing and similar credits in lieu of comparable assets.
(b) In the event of an Asset Disposition that requires the purchase of Securities pursuant to Section 4.6(a)(iii)(C), the Company will be required to be satisfied purchase Securities tendered pursuant to an offer by the Company for cash and Cash Equivalents the Securities (the "Offer") at a purchase price of 100% of their principal amount plus accrued interest to the extent date of purchase in accordance with the procedures (including prorating in the event of oversubscription) set forth in this Indenture. If the aggregate purchase price of Securities tendered pursuant to the Offer is less than the Net Available Cash allotted to the purchase of the cash or Securities, the Company will apply the remaining Net Available Cash Equivalents receivedin accordance with Section 4.6 (a)(iii)(D). Notwithstanding the foregoing provisions, the Company and its Restricted Subsidiaries shall not be required to apply any Net Available Cash in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, accordance herewith except to the extent that the aggregate Net Available Cash from all Asset Dispositions which are not applied in accordance with this covenant exceeds $5,000,000. The Company shall not be required to make an Offer for Securities pursuant to this covenant if the Net Available Cash available therefor (after application of the proceeds as provided in clauses (A) and (B)) is less than $7,500,000 (which lesser amounts shall be carried forward for purposes of determining whether an Offer is required with respect to the Net Available Cash from subsequent Asset Dispositions).
(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 Holder, at the address appearing in the Security Register, 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 prorationing 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 (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 of the Company and each any Current Report on Form 8-K of any the Company filed subsequent to such Quarterly Report, other Restricted Subsidiary are released from any Guarantee than Current Reports describing Asset Dispositions otherwise described in the offering materials (or corresponding successor reports), (ii) a 39 description of payment material developments in the Company's business subsequent to the date of the latest of such Indebtedness 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 connection 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"), (ii) the allocation of the Net Available Cash from the Asset Dispositions pursuant to which such Offer is being made and (iii) the compliance of such allocation with the provisions of Section 4.6(a). 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. Not later than 10:00 a.m. (New York City time) on the Purchase Date, the Company shall irrevocably deposit with the Trustee or with a paying agent (or, if the Company is acting as Paying Agent, segregate and hold in trust) an amount in cash sufficient to pay the Offer Amount for all Securities properly tendered to and 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.
(3) Holders electing to have a Security purchased will be required to surrender the Security, together with all necessary endorsements and other appropriate materials duly completed, to the Company at the address specified in the notice at least three Business Days prior to the Purchase Date. Holders will be entitled to withdraw their election in whole or in part 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 the Holder, the principal amount of the Security (which shall be $1,000 or an integral multiple thereof) which was delivered for purchase by the Holder, the aggregate principal amount of such Security (if any) that remains subject to the original notice of the Offer and that has been or will be delivered for purchase by the Company and a statement that such Holder is withdrawing his election to have such Security purchased. If at the expiration of the Offer Period the aggregate principal amount of Securities surrendered by Holders exceeds the Offer Amount, the Company shall select the Securities to be purchased on a pro rata basis (with such Asset Disposition; andadjustments as may be deemed appropriate by the Company so that only securities in denominations of $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.
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant A Security shall be deemed to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (with the fair market value of each item of Designated Non-Cash Consideration being measured have been accepted for purchase at the time received and without giving effect the Trustee, directly or through an agent, mails or delivers payment therefor to subsequent changes in value)the surrendering Holder.
(ed) The Company will comply shall comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 4.6. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 4.6, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture Section 4.6 by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Friendly Ice Cream Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Borrower will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Borrower or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 an Officer or the Board of Directors of the Borrower, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);; and
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition or such series of related Asset Dispositions (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, other than Indebtedness), together with all other Asset Dispositions since the Issue Closing Date (on a cumulative basis) received by the Company Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash Equivalents; andInvestments.
(3b) After the receipt of Net Available Cash from an Asset Disposition, the Borrower or a Restricted Subsidiary, as the case may be, may apply such Net Available Cash directly or indirectly (at the option of the Borrower or such Restricted Subsidiary):
(1) within 18 months 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company prepay, repay, purchase or redeem any Restricted SubsidiaryIndebtedness incurred under Section 4.04(b)(1); provided, as the case may behowever, elects (that, in connection with any prepayment, repayment or is required by the terms purchase of any IndebtednessIndebtedness pursuant to this Section 4.08(b)(1), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Borrower or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of any revolving Indebtedness) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchasedredeemed; (iiiii) Obligations under unless included in Section 4.08(b)(1)(i), to prepay, repay, purchase or redeem any Pari Passu Indebtedness of the Notes Borrower or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis byGuarantor, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for price of no less more than 100% of the principal amount thereof, of such Pari Passu Indebtedness plus the amount of accrued but and unpaid interest, if any, thereon up interest to the principal amount date of Notes such prepayment, repayment, purchase or redemption, provided that the Borrower or such Guarantor, as applicable, shall prepay, redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to be repurchased this clause (which offer shall be deemed ii) only if the Borrower delivers a notice of prepayment with respect to be an Asset Disposition Offer for purposes hereofthe Pari Ratable Share of the Term Loans in accordance with Section 2.13(a)(ii) within the time period specified by this Section 4.08(b)(1) and thereafter complies with its obligations under Section 2.13(a)(iii); (iii) to prepay, repay, purchase or (iv) redeem any Indebtedness of a Restricted Subsidiary that is not a GuarantorGuarantor or any Indebtedness that is secured on assets which do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Borrower or a Guarantor or Indebtedness owed to the Company Borrower or another any Restricted Subsidiary); or (iv) to prepay the Loans in full pursuant to Section 2.12;
(ii2) to the extent the Company Borrower or any such Restricted Subsidiary elects, to invest in or purchase or commit to invest in or purchase Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company Borrower or another Restricted Subsidiary)) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such investment or commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment invest is consummated within 180 days of such 365th day;
(3) to make a capital expenditure within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that any such capital expenditure made pursuant to a definitive binding agreement or a commitment (an “Acceptable Commitment”)approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as such investment is consummated within 180 days of such 365th day; or
(iii4) any combination of the foregoing; provided that clauses (1) — (3) of Section 4.08(b) above, provided that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clauses (1), (2), (3) or (4) of Section 3.54.08(b), the Company or Borrower and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zeroAgreement.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof4.08(a)(2), the following will be deemed to be cash:
(1) the assumption by the transferee (or other extinguishment in connection with the transactions relating to such Asset Dispositions) of Indebtedness or and any other liabilities, contingent or otherwise liabilities (as recorded on the balance sheet of the Company Borrower or a any Restricted Subsidiary 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 Borrower’s or such Restricted Subsidiary’s balance sheet or in the footnotes thereof 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 Borrower) of the Borrower or any Restricted Subsidiary (other than Subordinated Indebtedness of the Company Borrower or a Guarantor) and the release of the Company Borrower or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company Borrower or any Restricted Subsidiary of the Company from the transferee that are converted by the Company Borrower or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Borrower and each other Restricted Subsidiary (as applicable) are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Borrower or a Guarantor (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Borrower or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company Borrower or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 4.08 that is at that time outstanding, not to exceed the greater of (a) $100.0 110 million and (b) 7.55% of LTM L2QA Pro Forma EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Credit Agreement (Altice USA, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 365 days from the later of (A) the date 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 the such Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay elects:
(i) Obligations (i) to reduce, prepay, repay or purchase any Secured Indebtedness, including Indebtedness under a Debt Facility to the extent such Obligations were Incurred under clause Credit Agreement (1) of the second paragraph under Section 3.2 (and or any Refinancing Indebtedness in the case of revolving obligationsrespect thereof), to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured to reduce, prepay, repay or purchase Pari Passu Indebtedness, (iii) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to redeem Notes as described in Section 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (iv) to reduce, prepay, repay or purchase any Indebtedness of a Non-Guarantor (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretoany Restricted Subsidiary); provided that provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (a), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, (i) 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 equal Subsidiary); or (ii) to invest (including capital expenditures) in any one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event that any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Company or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iiSection 3.5(a)(3)(ii) above with respect to such Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of $60.0 15 million (such amount of Net Available Cash Applicable Proceeds that are less than or equal to the greater of $60.0 15 million, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 15 million, “Excess Proceeds”), then, 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 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 Applicable Proceeds 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 Applicable Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero. To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(cd) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition is received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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 impediments, in each case, from being repatriated to the United States, the portion of such Net Available Cash so affected will not be required to be applied in compliance with this Section 3.5covenant, and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulationlaw, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulationlaw, applicable organizational documents impediments or other impediments impediment to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required required, such repatriation of any of such affected Net Available Cash is permitted under the 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 reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an a materially adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation prepayment out of such Net Available Cash whereby doing so the Company, any Restricted Subsidiaryof its Subsidiaries, any Parent Entity or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a material Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 any material income or a withholding Tax), the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder)Subsidiary. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(de) For the purposes of Section 3.5(a)(2) hereof), the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise otherwise, of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and or the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 clause that is at that time outstanding, not to exceed the greater of (a) $100.0 15 million and (b) 7.515% of LTM EBITDA (EBITDA, 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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) of compliance therewith. The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding Notesoutstanding.
Appears in 1 contract
Sources: Indenture (Infrastructure & Energy Alternatives, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), if the property or assets sold or otherwise disposed of have a fair market value in excess of the greater of (x) $80.0 million and (y) 15.0% of LTM EBITDA, at least 7575.0% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 the Applicable Percentage of such Net Available Cash (the “Applicable Proceeds”) is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (A) to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase any Indebtedness of a Non-Guarantor Subsidiary (in each case, other than Indebtedness owed to the Company or a Guarantor any Restricted Subsidiary) or any Secured Indebtedness, including Indebtedness under the Credit Agreement (or any Refinancing Indebtedness in respect thereof) within 540 days from the later of (a) the date of such Asset Disposition and (b) the receipt of such Net Available Cash; provided, however, that, in the case connection with any prepayment, repayment or purchase of revolving obligationsIndebtedness pursuant to this clause (A), to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”)and, and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiB) Obligations under to prepay, repay or purchase Pari Passu Indebtedness; provided, further, that, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) of extent the Company redeems, repays or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior repurchases such Indebtedness other than the Notespursuant to this clause (B), the Company will either (1) shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 5.7, through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100.0% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100at 100.0% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary) within 540 days from the later of (after giving effect to any Acceptable Commitment or Second Commitment (each as defined below), the “Application Period”) (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event of any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Company or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; provided, further, that if any Second Commitment is later cancelled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Excess Proceeds; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iib) above with respect to such Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Diversey Holdings, Ltd.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions Disposition (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 455 days from the later of (A) the date 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 the 100% of such Net Available Cash is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay elects:
(i) Obligations (a) to reduce, prepay, repay or purchase any Secured Indebtedness, including Indebtedness under a Debt Facility the Credit Agreement (or any Refinancing Indebtedness in respect thereof), (b) to reduce, prepay, repay or purchase Pari Passu Indebtedness; provided, that the extent such Obligations were Incurred under clause Company ratably repay the Notes, (1c) of to make an offer (in accordance with the second paragraph procedures set forth below for an Asset Disposition Offer), redeem Notes as described under Section 3.2 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (and in the case of revolving obligationsd) to reduce, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured prepay, repay or purchase any Indebtedness of a Non-Guarantor (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretoany Restricted Subsidiary); provided that provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(iia) to the extent the Company or any Restricted Subsidiary elects, 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 equal Subsidiary); or
(b) to invest (including capital expenditures) in any one or more businesses (provided that any such business will be a Restricted Subsidiary), properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 event of the Notes, in cash in an any Acceptable Commitment is later cancelled or terminated for any reason before such amount equal to 100% of the principal amount thereof (or accreted value thereof, if less), 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 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 or otherwise surrendered is applied in connection with an Asset Disposition Offer made with Excess Proceeds (ortherewith, 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
enters into another Acceptable Commitment (2a “Second Commitment”) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of cancellation or termination; provided, further, that if any Restricted Subsidiary that Second Commitment is no longer a Restricted Subsidiary as a result of later cancelled or terminated for any reason before such Asset Dispositionamount is applied, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of then such Indebtedness in connection with such Asset DispositionNet Available Cash shall constitute Excess Proceeds; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.or
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company Issuer shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Issuer or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Issuer, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)) with a purchase price in excess of the greater of $375.0 million and 15.0% of LTM EBITDA, if after giving pro forma effect to such Asset Disposition, the Consolidated First Lien Secured Leverage Ratio is greater than 3.50 to 1.00, at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company Issuer or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 the Applicable Percentage of such Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company Issuer or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay ):
(i) Obligations (A) to reduce, prepay, repay or purchase any Secured Indebtedness, including Indebtedness under the Credit Agreement (or any Refinancing Indebtedness in respect thereof), (B) to reduce, prepay, repay or purchase Pari Passu Indebtedness, (C) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to redeem Notes as described under Section 5.7 hereof, or purchase Notes through open-market purchases or in privately negotiated transactions, or (D) to reduce, prepay, repay or purchase any Indebtedness of a Debt Facility Non-Guarantor (in each case, other than Indebtedness owed to the extent such Obligations were Incurred under Issuer or any Restricted Subsidiary); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (1) of i), the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Issuer or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, (A) 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 equal Subsidiary); or (B) to invest (including capital expenditures) in any one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryIssuer); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event that any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Issuer or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company Issuer or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company Issuer (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iib) above with respect to such Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of (i) $60.0 500.0 million or 20.0% of LTM EBITDA, in the case of a single transaction or a series of related transactions, or (ii) $1,000.0 million or 40.0% of LTM EBITDA aggregate amount in any fiscal year (in the cases of clauses (i) and (ii), such amount of Net Available Cash Applicable Proceeds that are less than or equal to $60.0 million500.0 million or 20.0% of LTM EBITDA or $1,000.0 million or 40.0% of LTM EBITDA, as applicable, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 million500.0 million or 20.0% of LTM EBITDA or $1,000.0 million or 40.0% of LTM EBITDA, as applicable, “Excess Proceeds”), then, then subject to the limitations with respect to Foreign Dispositions set forth below, the Company Issuer shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 Issuer may satisfy the foregoing obligation with respect to the Net Available Cash Applicable Proceeds 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 Applicable Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Pari Passu Indebtedness validly tendered 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 Issuer may include any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company Issuer shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero. Additionally, the Issuer may, at its option, make an Asset Disposition Offer using proceeds from any Asset Disposition at any time after the consummation of such Asset Disposition. Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Issuer may use such Net Available Cash for any purpose not prohibited by this Indenture.
(cd) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than U.S. Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in U.S. Dollars that is actually received by the Issuer upon converting such portion into U.S. Dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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 StatesStates or Canada, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulationlaw, applicable organizational documents or agreements or other impediments will not permit repatriation to the United States or Canada (the Company Issuer hereby agreeing to use reasonable efforts (as determined in the CompanyIssuer’s reasonable business judgment) to otherwise cause the applicable Foreign Subsidiary or CFC Holding Company to within one year following the date on which the respective payment would otherwise have been required, promptly take all commercially reasonable actions reasonably required by the applicable local law or regulationlaw, applicable organizational documents impediments or other impediments impediment to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required required, such repatriation of any of such affected Net Available Cash is permitted under the applicable local law, applicable organizational impediment impediments 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 (5) Business Days after such repatriation could be maderepatriation) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company Issuer has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the CompanyIssuer, any Restricted Subsidiaryof its Subsidiaries, any Parent Entity, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt as a result of a Tax dividend or deemed dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax) with respect to such Net Available Cash, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder)Subsidiary. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section 3.5(a)(2) hereof, the following will shall be deemed to be cash:
(1i) the assumption by the transferee of Indebtedness or other liabilities, liabilities contingent or otherwise of the Company Issuer or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company Issuer, the Co-Issuer or a Guarantor) and the release of the Company Issuer or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2ii) securities, notes or other obligations received by the Company Issuer or any Restricted Subsidiary of the Company from the transferee that are converted by the Company Issuer or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3iii) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Issuer and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(iv) consideration consisting of Indebtedness of the Issuer (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Issuer or any Restricted Subsidiary; and
(4v) any Designated Non-Cash Consideration received by the Company Issuer or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 750.0 million and (b) 7.530.0% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company Companies shall not, and shall not permit any of its their respective Restricted Subsidiaries to, make any Asset Disposition unless:
(1i) the such Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Issuers, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2ii) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) ), received by the such Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3iii) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(iA) to the extent the a Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (x) to prepay, repay or purchase any Indebtedness of a Non-Guarantor (iother than Indebtedness owed to a Company or any Restricted Subsidiary) Obligations or any Secured Indebtedness, including Indebtedness under a Debt Facility to the extent such Obligations were Incurred under clause Credit Agreement within 365 days from the later of (1) the date of such Asset Disposition and (2) the second paragraph under Section 3.2 receipt of such Net Available Cash; provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (and in the case of revolving obligationsA), to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the a Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiy) Obligations under the Notes to prepay, repay or any other purchase Pari Passu Indebtedness (other at a price of no more than Subordinated Indebtedness) 100% of the Company principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest to the date of such prepayment, repayment or any Restricted Subsidiarypurchase; provided that if further that, to the extent a Company redeems, repays or any Restricted Subsidiary shall so repay any senior repurchases Pari Passu Indebtedness other than the Notespursuant to this clause (y), the Company will either (1) Issuers shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 5.07 or (B) purchasing Notes Section 5.08, as applicable, through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below in this Section 3.05 for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and/or
(iiB) to the extent the a Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the a Company or another Restricted Subsidiary)) within 365 days from the later of (x) the date of such Asset Disposition and (y) the receipt of such Net Available Cash; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
) and, in the event of any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, a Company or such Restricted Subsidiary enters into another Acceptable Commitment (iiia “Second Commitment”) any combination within 180 days of the foregoingsuch cancellation or termination; provided further that (1) if any Second Commitment is later cancelled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Excess Proceeds; provided that, pending the final application of the amount of any such Net Available Cash pursuant to in accordance with clause (A) or clause (B) of this Section 3.53.05(a)(iii), the a Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture and Indenture.
(2b) the Company (or The amount of any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash attributable to any given from Asset Disposition (provided Dispositions that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, execution of a definitive agreement for the relevant Asset Disposition, and consummation of the relevant Asset Disposition) and deem the amount so is not applied or invested or committed to be applied pursuant or invested as provided in Section 3.05(a) will be deemed to and in accordance with clause (ii) above with respect to such Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, constitute “Excess Proceeds”), then, subject to ” under this Indenture. If the limitations with respect to Foreign Dispositions set forth belowaggregate amount of Excess Proceeds under this Indenture exceeds $100.0 million, the Company shall Issuers will within 20 Business Days be required to make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes issued under this Indenture and, if required by to the terms of any Pari Passu Indebtednessextent the Issuers elect, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, in the case of the Notes, in cash price in an amount equal to 100% of the principal amount thereof (or accreted value thereofof the Notes and Pari Passu Indebtedness, if less)in each case, 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 offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and, with respect to the Notes, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices The Issuers will deliver notice of an such Asset Disposition Offer shall be sent electronically or by first 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 DTCmail, with a copy to the Trustee, to each Holder of Notes at the address of such Holder appearing in the Note Register or otherwise in accordance with the procedures of DTC, describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is delivered, pursuant to the procedures required by this Indenture and described in such notice. The Company Issuers may satisfy the foregoing obligation obligations with respect to the any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to all Net Available Cash prior to the expiration of the Proceeds Application Period relevant 365 days (the “Advance Offer”or such longer period provided above) or 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 Indentureany unapplied Excess Proceeds.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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) in Declined Excess Proceeds, and the Issuers may use such Declined any remaining Excess Proceeds for any purpose not 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 surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (orProceeds, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds shall be allocated among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero. Additionally, the Issuers may, at their option, make an Asset Disposition Offer using proceeds from any Asset Disposition at any time after the consummation of such Asset Disposition. Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Issuers may use such Net Available Cash for any purpose not prohibited by this Indenture.
(cd) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than U.S. dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in U.S. dollars that is actually received by the Issuers upon converting such portion into U.S. dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
3.05, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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 law from being repatriated to the United States, the portion of such Net Available Cash so affected will not be required to be applied in compliance with this Section 3.53.05, and such amounts may be retained by the applicable Foreign Subsidiary or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the United States (the Company Issuers hereby agreeing to use reasonable efforts (as determined in the Company’s reasonable business judgment) to otherwise cause the applicable Foreign Subsidiary or CFC Holding Company to within one year following the date on which the respective payment would otherwise have been required, promptly take all commercially reasonable actions reasonably required by available under the applicable local law or regulation, applicable organizational documents or other impediments to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required once such repatriation of any of such affected Net Available Cash is permitted under the applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and such repatriated Net Available Cash will be promptly (and in any event not later than five ten (10) Business Days after such repatriation could be maderepatriation) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.05 and (ii) to the extent that the Company has Issuers have determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, Companies or any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners Subsidiary would incur Incur a Tax tax liability, including receipt as a result of a Tax dividend or deemed dividend, deemed dividend pursuant to Code Section 956 or a withholding Taxtax, but taking into account any foreign tax credit or benefit received in connection with such repatriation) with respect to such Net Available Cash, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of DefaultSubsidiary.
(df) For the purposes of Section 3.5(a)(23.05(a)(ii) hereof, the following will be deemed to be cash:
(1i) the assumption by the transferee of Indebtedness or other liabilities, liabilities contingent or otherwise of the a Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the a Company or a Guarantor) and the release of the such Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2ii) securities, notes or other obligations received by the a Company or any Restricted Subsidiary of the Company from the transferee that are converted by the such Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3iii) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Companies and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(iv) consideration consisting of Indebtedness of a Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not a Company or any Restricted Subsidiary; and
(4v) any Designated Non-Cash Consideration received by the a Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 3.05 that is at that time outstanding, not to exceed the greater of (a) $100.0 250.0 million and (b) 7.517.50% of LTM EBITDA (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).
(eg) Upon the commencement of an Asset Disposition Offer, the Issuers shall send, or cause to be sent, by first class mail or electronically, 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:
(i) that the Asset Disposition Offer is being made pursuant to this Section 3.05 and that, to the extent lawful, all Notes tendered and not withdrawn shall be accepted for payment (unless prorated);
(ii) the Asset Disposition payment amount, the Asset Disposition offered price, and the date on which Notes tendered and accepted for payment shall be purchased, which date shall be at least 30 days and not later than 60 days from the date such notices is mailed (the “Asset Sale Payment Date”);
(iii) that any Notes not tendered or accepted for payment shall continue to accrue interest in accordance with the terms thereof;
(iv) that, unless the Issuers default in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrue interest on and after the Asset Sale Payment Date;
(v) that Holders electing to have any Notes purchased pursuant to any Asset Disposition Offer shall be required to surrender the Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice at least three Business Days before the Asset Sale Payment Date;
(vi) that Holders shall be entitled to withdraw their election if the Paying Agent receives, not later than two Business Days prior to the Asset Sale Payment 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 its election to have such Note purchased;
(vii) that if the aggregate principal amount of Notes surrendered by Holders exceeds the Asset Disposition payment amount, the Issuers shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Issuers so that only Notes in denominations of $2,000 or integral multiples of $1,000 in excess thereof shall be purchased); and
(viii) 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).
(h) If the Asset Sale Payment Date is on or after a record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Asset Disposition Offer.
(i) On the Asset Sale Payment Date, the Issuers will, to the extent permitted by law,
(i) accept for payment all Notes issued by it or portions thereof properly tendered pursuant to the Asset Disposition Offer,
(ii) deposit with the Paying Agent an amount equal to the aggregate Asset Disposition payment in respect of all Notes or portions thereof so tendered, and
(iii) deliver, or cause to be delivered, to the Trustee for cancellation the Notes so accepted together with an Officer’s Certificate to the Trustee stating that such Notes or portions thereof have been tendered to and purchased by the Issuers.
(j) The Company Issuers will comply comply, to the extent applicable, with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws laws, rules and regulations thereunder to the extent those such laws and or regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 3.05. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this Indenture, the Company Issuers will comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.no
Appears in 1 contract
Sources: Indenture (Yum Brands Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its the Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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) of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), (A) to prepay, repay or purchase any Indebtedness of a non-Guarantor or any Secured Indebtedness (i) Obligations under a Debt Facility in each case, other than Indebtedness owed to the extent such Obligations were Incurred Company or any Restricted Subsidiary), including Indebtedness under clause the Credit Agreement (or any Refinancing Indebtedness in respect thereof), within 450 days from the later of (1) the date of such Asset Disposition and (2) the second paragraph under Section 3.2 receipt of such Net Available Cash; provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (and in the case of revolving obligationsi), to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iiiB) Obligations under the Notes to prepay, repay or any other purchase Pari Passu Indebtedness either (other x) at a price of no more than Subordinated Indebtedness) 100% of the Company principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest to the date of such prepayment, repayment or any Restricted Subsidiarypurchase or (y) at a premium pursuant to the terms of such Pari Passu Indebtedness; provided that if further that, to the extent the Company redeems, repays or any Restricted Subsidiary shall so repay any senior repurchases Pari Passu Indebtedness other than the Notespursuant to this clause (B), the Company will either (1) shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 5.7, through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes that would otherwise be prepaid; provided further, that, in addition to be repurchased (which offer shall be deemed to be the foregoing, the Net Available Cash from an Asset Disposition Offer for purposes hereof); of Collateral may not be applied to prepay, repay or (iv) purchase any Indebtedness other than First Priority Obligations, Second Lien Notes or Pari Passu Indebtedness of the Issuers or a Restricted Subsidiary that is not Guarantor secured by a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;Lien on such Collateral; and
(ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary)) within 450 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”)) and, in the event of any Acceptable Commitment is later cancelled or terminated for any reason before such amount is applied in connection therewith, the Company or such Restricted Subsidiary enters into another Acceptable Commitment (a “Second Commitment”) within 180 days of such cancellation or termination; orprovided further that if any Second Commitment is later cancelled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Excess Proceeds; and
(iii4) any combination if such Asset Disposition involves the disposition of Collateral, the foregoingCompany or such Subsidiary has complied with the provisions of this Indenture and the Collateral Documents; provided that (1) that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clause (i) or clause (ii) in Section 3.53.5(a)(3), the Company or and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply use such Net Available Cash in any manner not prohibited by this Indenture and (2) Indenture; provided further that notwithstanding the Company (or any Restricted Subsidiaryforegoing, as in the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash attributable to any given Asset Disposition (provided event that such investment shall be made no earlier than the earliest of written notice after giving pro forma effect to the Trustee of LifeCell Disposition the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are Consolidated Total Leverage Ratio is less than or equal to $60.0 million4.5 to 1.0, “Declined Excess Proceeds,” Section 3.5(a)(2) and such (3) shall not apply with respect to the LifeCell Disposition.
(b) The amount of any Net Available Cash from Asset Dispositions that are is not applied or invested or committed to be applied or invested as provided in excess of $60.0 million, the preceding paragraph will be deemed to constitute “Excess Proceeds”)” under this Indenture. On the 451st day after the later of an Asset Disposition or the receipt of such Net Available Cash, then, subject to if the limitations with respect to Foreign Dispositions set forth belowaggregate amount of Excess Proceeds under this Indenture exceeds $50.0 million, the Company shall Issuers will within 10 Business Days be required to make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes issued under this Indenture and, if required by to the terms of any Pari Passu Indebtednessextent the Issuers elect, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, price in the case respect of the Notes, in cash Notes in an amount equal to 100% of the principal amount thereof (or accreted value thereofof the Notes and Pari Passu Indebtedness, if less)in each case, 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 offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and, with respect to the Notes, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices The Issuers will deliver notice of an such Asset Disposition Offer shall be sent by first class mail or sent electronicallyOffer, at least 10 days but not more than 60 days before with a copy to the purchase date to Trustee, the Paying Agent and each Holder of the Notes at the address of such Holder’s registered address Holder appearing in the security register or otherwise in accordance with the applicable procedures of DTC, with a copy describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date will be no earlier than 30 days and no later than 60 days from the date such notice is delivered, pursuant to the Trusteeprocedures required by this Indenture and described in such notice. The Company Issuers may satisfy the foregoing obligation obligations with respect to the any Net Available Cash from an Asset Disposition by making an Asset Disposition Offer with respect to all Net Available Cash prior to the expiration of the Proceeds Application Period relevant 450 days (the “Advance Offer”or such longer period provided above) or 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 Indentureany unapplied Excess Proceeds.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other and Pari Passu Indebtedness so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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) in Declined Excess Proceeds, and the Issuers may use such Declined any remaining Excess Proceeds for any purpose not 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 surrendered in any Asset Disposition Offer by Holders and other Pari Passu Indebtedness surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (or, in the case of an Advance OfferProceeds, the Advance Portion), the Company Issuers shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; Indebtedness provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero. Additionally, the Issuers may, at their option, make an Asset Disposition Offer using proceeds from any Asset Disposition at any time after the consummation of such Asset Disposition. Upon consummation or expiration of any Asset Disposition Offer, any remaining Net Available Cash shall not be deemed Excess Proceeds and the Issuers may use such Net Available Cash for any purpose not prohibited by this Indenture.
(cd) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that an amount equal to any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, an amount equal to the portion of such Net Available Cash 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 or CFC Holding Company 3.5 so long, but only so long, as the applicable local law or regulationlaw, applicable organizational documents or documents, agreements or other impediments impediment will not permit repatriation to the 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 or CFC Holding Company to within one year following the date on which the respective payment would otherwise have been required, promptly take all commercially reasonable actions reasonably required by available under the applicable local law or regulation, applicable organizational documents or other impediments to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required once such repatriation of any of such affected Net Available Cash is permitted under the applicable local law, applicable organizational impediment documents, agreements or other impedimentimpediments, such repatriation will be promptly effected and such repatriated an amount equal to the Net Available Cash will be promptly (and in any event not later than five (5) Business Days after such repatriation could be made) applied (net of additional Taxes payable or reserved against as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, of any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates affiliates and/or direct or indirect equity owners would incur a Tax tax liability, including receipt as a result of a Tax dividend or deemed dividend, deemed dividend pursuant to Code Section 956 or a withholding Taxtax, but taking into account any foreign tax credit or benefit received in connection with such repatriation) with respect to such Net Available Cash, an amount equal to the Net Available Cash so affected may will not be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts required to be repatriated to the United States (whether or not such amounts are used applied in or excluded from the determination of the amount of any mandatory prepayments hereunder)accordance with this Section 3.5. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1i) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise otherwise, of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company Issuers or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2ii) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3iii) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(iv) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(4v) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 225.0 million and (b) 7.53.30% of LTM EBITDA Total Assets (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).
(eg) The Company will comply with Upon the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result commencement of an Asset Disposition may Offer, the Issuers shall send, or cause to be waived sent, a notice to the Trustee and to each Holder at its registered address, or modified deliver otherwise in accordance with the written consent applicable procedures of the Depositary. 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:
(1) that the Asset Disposition Offer is being made pursuant to this Section 3.5 and that, to the extent lawful, all Notes tendered and not withdrawn shall be accepted for payment (unless prorated);
(2) the Asset Disposition payment amount, the Asset Disposition offered price, and the date on which Notes tendered and accepted for payment shall be purchased, which date shall be at least 30 days and not later than 60 days from the date such notices are sent (the “Asset Sale Payment Date”);
(3) that any Notes not tendered or accepted for payment shall continue to accrue interest in accordance with the terms thereof;
(4) that, unless the Issuers default in making such payment, any Notes accepted for payment pursuant to the Asset Disposition Offer shall cease to accrue interest on and after the Asset Sale Payment Date;
(5) that Holders electing to have any Notes purchased pursuant to any Asset Disposition Offer shall be required to surrender the Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice at least three Business Days before the Asset sale Payment Date;
(6) that Holders shall be entitled to withdraw their election if the Paying Agent receives, not later than two Business Days prior to the Asset Sale Payment Date, a majority in 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 its election to have such Note purchased;
(7) that if the aggregate principal amount of Notes surrendered by Holders exceeds the then outstanding Notes.Asset Disposition payment amount, the Issuers shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Issuers so that only Notes in denominations of $2,000 or integral multiples of $1,000 in excess thereof shall be purchased); and
(8) that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurch
Appears in 1 contract
Sources: Indenture (Acelity L.P. Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap)) with a purchase price in excess of the greater of $400.0 million and 1.50% of Total Assets, other than in a sale of the Budget Truck Division for fair market value, at least 75% of the consideration from such Asset Disposition (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) ), received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from an amount equal to the later of (A) the date of such Asset Disposition and (B) the receipt Applicable Percentage of the Net Available Cash (the “Applicable Proceeds”) from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(iA) to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligationsprepay, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured repay or purchase any Indebtedness of a Non-Guarantor, any Indebtedness that is secured by a Lien (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company any Restricted Subsidiary) or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility the Credit Agreement (or any Refinancing Indebtedness in respect thereof) to within 545 days from the extent later of (A) the assets sold or otherwise disposed date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that, in connection with such Asset Disposition constituted “borrowing base assets”any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or Restricted Subsidiary shall retire such Indebtedness and will shall cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchasedpurchased or (ii) to prepay, repay or purchase Pari Passu Indebtedness at a price of no more than 100% of the principal amount of such Pari Passu Indebtedness plus accrued and unpaid interest, if any, to, but not including, the date of such prepayment, repayment or purchase; (iii) Obligations under provided, further, that, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) of extent the Company or any Restricted Subsidiary; provided that if the Company or any a Restricted Subsidiary shall so repay any senior redeems, repays or repurchases Pari Passu Indebtedness other than the Notespursuant to this clause (ii), the Company will either (1) Issuer shall equally and ratably reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described provided under Section 5.6 or (B) purchasing Notes 5.7 through open-market purchases (to the extent such purchases are at or in arm’s-length privately negotiated transactions (which, in each case, may be below par), above 100% of the principal amount thereof) or (2) make by making an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than at 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to on the principal amount of Notes to that would otherwise be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof)prepaid; or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;and/or
(iiB) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash Applicable Proceeds received by the Company or another Restricted Subsidiary)) within 545 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Applicable Proceeds; provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoingcommitment; provided that that, (1) pending the final application of the amount of any such Net Available Cash pursuant to this Applicable Proceeds in accordance with clause (A) or (B) of Section 3.53.5(a)(3), the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit FacilitiesFacility) or otherwise apply use such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 (iiSection 3.5(a)(3)(B) above with respect to such Asset Disposition. If.
(b) On the 546th day after the later of an Asset Disposition or the receipt of such Applicable Proceeds, with respect to any Asset Disposition, at if the expiration aggregate amount of Excess Proceeds under this Indenture exceeds (i) the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess greater of $60.0 200.0 million and 0.75% of Total Assets, in the case of a single transaction or a series of related transactions, or (ii) the greater of $400.0 million and 1.50% of Total Assets aggregate amount in any fiscal year (such amount of Net Available Cash Applicable Proceeds that are less than do not exceed (i) the greater of $200.0 million and 0.75% of Total Assets, in the case of a single transaction or equal to a series of related transactions, or (ii) the greater of $60.0 million400.0 million and 1.50% of Total Assets aggregate amount in any fiscal year, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess do exceed (i) the greater of $60.0 million200.0 million and 0.75% of Total Assets, in the case of a single transaction or a series of related transactions, or (ii) the greater of $400.0 million and 1.50% of Total Assets aggregate amount in any fiscal year, “Excess Proceeds”), then, subject the Issuer will within 10 Business Days be required to the limitations with respect to Foreign Dispositions set forth below, the Company shall make an offer (an “Asset Disposition Offer”) no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes issued under this Indenture and, if required by to the terms of any Pari Passu Indebtednessextent the Issuer or the Company elects, to all holders of such other outstanding Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and any such Pari Passu Indebtedness, as appropriate, on a pro rata basis, Indebtedness to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, in the case of the Notes, in cash price in an amount equal to 100% of the principal amount thereof (or in the event such other Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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), in each case, plus accrued and unpaid interest, if any, to, but not including, the date fixed for the closing of such offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu Indebtedness, as applicable, and, with respect to the Notes, in minimum denominations of $2,000 €100,000 and in integral multiples of $€1,000 in excess thereof. Notices The Issuer shall deliver notice of an such Asset Disposition Offer shall be sent by first class mail or sent electronicallyelectronically or, at least 10 days but not more than 60 days before the purchase date Issuer’s option, by first-class mail, with a copy to the Trustee, to each Holder of Notes at the address of such Holder appearing in the Notes at such Holder’s registered address Register or otherwise in accordance with the applicable procedures of DTCthe Depositary, with a copy describing the transaction or transactions that constitute the Asset Disposition and offering to repurchase the Notes for the specified purchase price on the date specified in the notice, which date will be no earlier than 10 days and no later than 60 days from the date such notice is delivered, pursuant to the Trusteeprocedures required by this Indenture and described in such notice. The Company Issuer may satisfy the foregoing obligation obligations with respect to the Net Available Cash any Applicable Proceeds from an Asset Disposition by making an Asset Disposition Offer with respect to all Applicable Proceeds prior to the expiration of the Proceeds Application Period relevant 545 days (the “Advance Offer”or such longer period provided above) or 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 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) in Declined unapplied Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Avis Budget Group, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset DispositionDisposition , or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition), together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months 540 days from the later of (A) the date 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 as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent such Net Available Cash is from an Asset Disposition of Collateral, the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness)): (a) to prepay, to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase any Indebtedness of a Non-Guarantor Subsidiary (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretoany Restricted Subsidiary); provided that provided, however, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (ii) to reduce, prepay, repay or purchase First Lien Obligations (other than the Notes) including Indebtedness under the Credit Agreements (or any Refinancing Indebtedness in respect thereof); provided, that the Company shall equally and ratably reduce Obligations under the Notes as provided under Section 5.7 or through open-market purchases; provided further, that, in connection with any prepayment, repayment or purchase of Indebtedness pursuant to this clause (ii), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; or (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) to make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) ), to all Holders redeem Notes as provided under Section 5.7, or purchase Notes through open-market purchases or in privately negotiated transactions (provided, further, that if any such offer to purchase their any Notes on a ratable basis with is made, such other senior Indebtedness for no less than 100% amount will be deemed repaid to the extent of the principal amount thereof, plus the amount of accrued but unpaid interestsuch offer, if any, thereon up whether or not accepted by the holders of such Notes); and
(ii) to the principal amount of Notes to be repurchased (which offer shall be deemed to be extent such Net Available Cash is from an Asset Disposition Offer of assets or property that do not constitute Collateral, the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness): (w) to reduce, prepay, repay or purchase any Indebtedness secured by a Lien on such asset, (x) to reduce, prepay, repay or purchase Pari Passu Indebtedness; provided, that the Company shall equally and ratably reduce Obligations under the Notes as provided under Section 5.7 or through open-market purchases, (y) to make an offer (in accordance with the procedures set forth below for purposes hereofan Asset Disposition Offer); , to redeem Notes as described under Section 5.7, or purchase Notes through open-market purchases or in privately negotiated transactions, or (ivz) to reduce, prepay, repay or purchase any Indebtedness of a Restricted Subsidiary that is not a GuarantorNon-Guarantor (in each case, other than Indebtedness owed to the Company or another any Restricted Subsidiary;); provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (ii), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased (provided further, that if any such offer to purchase any Notes is made, such amount will be deemed repaid to the extent of the amount of such offer, whether or not accepted by the holders of such Notes); and
(iiiii) to the extent the Company or any Restricted Subsidiary elects, (i) to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary) or (ii) to invest in any one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition (provided that any such business, properties and/or assets will be, or will be held by, one or more Restricted Subsidiaries), with any such investment made by way of a 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, however, that such Additional Assets shall be pledged as Collateral (unless such Additional Assets are Excluded Assets and are not pledged to secure any other First Lien Obligations) under the Notes Collateral Documents and in accordance with this Indenture substantially simultaneously with such investment to the extent the assets or property disposed of constituted Collateral; provided further that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iiiiv) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture Indenture, and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset DispositionDisposition of Collateral, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of the greater of $60.0 75 million and 10% of LTM EBITDA (such amount of Net Available Cash that are equal to the greater of $75 million and 10% of LTM EBITDA, “Declined Collateral Excess Proceeds,” and such amount of Net Available Cash that are in excess of the greater of $75 million and 10% of LTM EBITDA, “Collateral Excess Proceeds”), then subject to the limitations with respect to Foreign Dispositions set forth below, the 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, if required by the terms of any First Lien Obligations or Pari Passu Indebtedness, to all holders of such First Lien Obligations or Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes, First Lien Obligations and Pari Passu Indebtedness, as appropriate, on a pro rata basis, that may be purchased out of such Collateral 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 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 First Lien Obligations or 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 First Lien Obligations or Pari Passu Indebtedness, as applicable, in minimum denominations of $2,000 and in integral multiples of $1,000 in excess thereof. Notices of a Collateral 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 by making a Collateral Asset Disposition Offer prior to the expiration of the Proceeds Application Period (the “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 (or accreted value, as applicable) of Notes and, if applicable, any other First Lien Obligations or Pari Passu Indebtedness, as the case may be, validly tendered or otherwise surrendered in connection with a Collateral Asset Disposition Offer made with Collateral Excess Proceeds (or, in the case of an Collateral Advance Offer, the Collateral Advance Portion) is less than the amount offered in a Collateral Asset Disposition Offer, the Company may include any remaining Collateral Excess Proceeds (or, in the case of an Collateral Advance Offer, the Collateral Advance Portion) in Declined Collateral Excess Proceeds, and use such Declined Collateral Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, First Lien Obligations or Pari Passu Indebtedness 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, First Lien Obligations and Pari Passu Indebtedness to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes, First Lien Obligations and Pari Passu Indebtedness; provided that no Notes, First Lien Obligations or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Collateral Asset Disposition Offer, the amount of Net Available Cash and Collateral Excess Proceeds shall be reset at zero. If, with respect to any Asset Disposition of assets or property that does 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 the greater of $75 million and 10% of LTM EBITDA (such amount of Net Available Cash that are equal to the greater of $60.0 million75 million and 10% of LTM EBITDA, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of the greater of $60.0 million75 million and 10% of LTM EBITDA, “Excess Proceeds”), then, 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 10 Business Days 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero. To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (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).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Owens & Minor Inc/Va/)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make consummate any Asset Disposition unless:
(1) unless the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition at least equal to the fair market value (such fair market including as to the value to be of all non-cash consideration), as determined on in good faith by the date Board of contractually agreeing to such Asset Disposition) Directors, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), and at least 7580% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalents; and
(3) within 18 months from cash equivalents. In the later of (A) event and to the date of such Asset Disposition and (B) extent that the receipt of the aggregate Net Available Cash received by the Company or any Restricted Subsidiary from one or more Asset Dispositions occurring on or after the Issue Date and not applied pursuant to clause (i) or (ii) below exceeds $5 million, then the Company or such Asset Disposition Restricted Subsidiary shall (as may be extended by an Acceptable Commitment as set forth below, i) within 360 days after - the “Proceeds Application Period”), an amount equal to the date such Net Available Cash is applied:
(i) so received exceeds $5 million and to the extent the Company or any such Restricted Subsidiary, as the case may be, Subsidiary elects (or is required by the terms of any Senior Indebtedness), (A) apply an amount equal - to such excess Net Available Cash to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase Senior Indebtedness of the Company or such Restricted Subsidiary, in each case owing to a Guarantor Person other than the Company or any Affiliate of the Company, or (B) invest - (or enter into a binding commitment to invest; provided, however, that such -------- ------- commitment shall be subject only to customary conditions (other than financing) and such investment shall be consummated within 180 days after the end of such 360-day period) an amount equal to such Net Available Cash not applied pursuant to clause (A), in Additional Assets (including by means of an Investment in Additional Assets by a Restricted Subsidiary with Net Available Cash received by the case Company or another Restricted Subsidiary) and (ii) apply such excess Net -- Available Cash (to the extent not applied pursuant to clause (i)) as provided in paragraphs (b) through (f) of revolving obligationsthis Section 4.06; provided, however, that in -------- ------- connection with any prepayment, repayment or purchase of Senior Indebtedness pursuant to correspondingly reduce commitments with respect thereto); provided that clause (A) above, the Company or such Restricted Subsidiary will shall retire such Senior Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will shall cause the related commitment (loan commitment, if any) , to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the . The amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes such excess Net Available Cash required to be repurchased (which offer shall be deemed applied pursuant to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
clause (ii) to the extent the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement above and not theretofore so applied shall be treated as a permitted constitute "Excess Proceeds." Pending application of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net --------------- Available Cash pursuant to this Section 3.54.06(a), the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 invested in Temporary Cash Investments.
(b) If at any time the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such aggregate amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, Proceeds not theretofore subject to the limitations with respect to Foreign Dispositions set forth belowan Excess Proceeds Offer totals at least $5 million, the Company shall shall, not later than 30 days after the end of the period during which the Company is required to apply such Excess Proceeds pursuant to Section 4.06(a)(i) (or, if the Company so elects, at any time within such period), make an offer (an “Asset Disposition "Excess Proceeds Offer”") no later than 10 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 from the maximum holders thereof on a --------------------- pro rata basis an aggregate principal amount of such Notes and Pari Passu Indebtednessother pari passu debt ---------- obligations subject to a similar covenant (collectively, as appropriate, the "pari passu Notes") ---------------- equal to the Excess Proceeds (rounded down to the nearest multiple of $1,000) on a pro rata basis, that may be purchased out of such Excess Proceeds, if anydate, at an offer price, in the case of the Notes, in cash in an amount a purchase price equal to 100% of the principal amount thereof (or accreted value thereofof such Notes and pari passu Notes, if less)plus, plus in each case, accrued interest and unpaid interest, if any (or such lesser price with respect to Pari Passu Indebtednessliquidated ---- ----- damages, if any, as may be provided by the terms of such other Indebtedness), to, but not including, to the date fixed for of purchase (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"Excess Proceeds Payment"). Notices Upon ----------------------- completion 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 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 or otherwise surrendered in connection with an Asset Disposition Offer made with Excess Proceeds (or, in the case of an Advance Offer, the Advance Portionamount of Excess Proceeds remaining after application pursuant to such Excess Proceeds Offer (including payment of the purchase price for Notes and pari passu ---- ----- Notes duly tendered) is less than the amount offered in an Asset Disposition Offer, may be used by the Company may include any remaining Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any corporate purpose (to the extent not otherwise prohibited by this Indenture. ).
(c) If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Pari Passu Indebtedness and pari passu Notes validly tendered pursuant to any Asset Disposition and not withdrawn in ---- ----- connection with an Excess Proceeds Offer exceeds the amount of Excess Proceeds (oravailable therefor, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the such Excess Proceeds among will be apportioned between the Notes and Pari Passu Indebtedness such pari passu Notes, with the portion of such Excess Proceeds payable in respect of ---- ----- the Notes equal to be purchased on the amount of such Excess Proceeds multiplied by a pro rata basis on fraction, the basis numerator of which is the outstanding principal amount of the aggregate Notes and the denominator of which is the sum of the outstanding principal amount of the Notes and the outstanding principal amount (or accreted value, as applicable) of tendered Notes and such Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denominationthe relevant pari passu Notes. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.---- -----
(d) For the purposes of this Section 3.5(a)(2) hereof4.06, the following will be are deemed to be cash:
: (1i) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Senior Indebtedness of the Company or a Guarantor) any - Restricted Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
Disposition and (2ii) securities, notes or other obligations securities 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 or Cash Equivalentscash; provided, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received)however, in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash -------- ------- Noncash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions Sale having an aggregate fair market value, taken together with all other Designated Non-Cash Noncash Consideration received pursuant to this Section 3.5 proviso that is at that time outstanding, not to exceed the greater of (a) $100.0 5 million and (b) 7.5% of LTM EBITDA (with the fair market value of each 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 the purposes of this Section 4.06(d).
(e) The Company will comply shall comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws or regulations in the event that Excess Proceeds are received by the Company and regulations thereunder the Company is required to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 4.06. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 4.06, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture by virtue thereofhereof.
(f1) Promptly, and in any event within 30 days after the Company becomes obligated to make an Excess Proceeds 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 such Holder's Notes purchased by the Company either in whole or in part (subject to prorationing as hereinafter described in the event the Excess Proceeds 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 will include (i) a description of material developments - in the Company's business subsequent to the date of the latest reports furnished by the Company to the Holders pursuant to Section 4.02 and (ii) if material, -- appropriate pro forma financial information) and all instructions and materials necessary to tender Notes pursuant to the Excess Proceeds Offer, together with the information required to be provided pursuant to Section 4.06(f)(2).
(2) Not later than the date upon which written notice of an Excess Proceeds Offer is delivered to the Trustee pursuant to Section 4.06(f)(1) above, the Company shall deliver to the Trustee an Officers' Certificate as to (i) the - amount of the Excess Proceeds Offer (the "Offer Amount"), (ii) the allocation of ------------ -- the Net Available Cash from the Asset Dispositions pursuant to which such Excess Proceeds Offer is being made and (iii) the compliance of such allocation with --- the provisions of Section 4.06(a). On or 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 amount equal to the Offer Amount to be held for payment in accordance with the provisions of this Indenture relative Section 4.06(f). Upon the expiration of the period for which the Excess Proceeds Offer remains open (the "Offer ----- Period"), the Company shall deliver to the Company’s obligation to make an offer to repurchase Trustee for cancellation the Notes as a result of an Asset Disposition may or ------ portions thereof which have been properly tendered to and are to be waived accepted by the Company. The Trustee shall, on the Purchase Date, mail or modified with deliver payment to each tendering Holder in the written consent 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, the Trustee shall deliver the excess to the Company immediately after the expiration of the Offer Period for application in accordance with Section 4.06(b).
(3) Holders 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. 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, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Note which was delivered for purchase by the Holder and a majority in statement that such Holder is withdrawing his election to have such Note purchased. If at the expiration of the Offer Period the aggregate principal amount of Notes surrendered by Holders exceeds the then outstanding NotesOffer 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). Holders whose Notes are purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered.
(4) At the time the Company delivers Notes to the 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 4.06. A Note 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.
Appears in 1 contract
Sources: Indenture (Iron Age Corp)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 Board of Directors of the Company (including as to the value of all non-cash consideration), of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap)Disposition;
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) Disposition received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (is applied by the Company or such Restricted Subsidiary at its option, as the case may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is appliedbe:
(ia) first, to the extent the Company or any Restricted Subsidiary, as the case may be, elects (or is required by the terms of any Indebtedness), to prepay, repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured or purchase secured Indebtedness of the Company (other than any Disqualified Stock or Subordinated Obligations) or secured Indebtedness of a Wholly-Owned Subsidiary (other than any Disqualified Stock or Guarantor Subordinated Obligation of a Wholly-Owned Subsidiary that is a Subsidiary Guarantor) (and in each case other than Indebtedness owed to the case Company or an Affiliate of revolving obligationsthe Company) within 360 days 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 correspondingly reduce commitments with respect theretothis clause (a); provided that , the Company or such Restricted Subsidiary will shall retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will shall cause the related commitment (if any) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid or purchased; ;
(iiib) Obligations under second, to the Notes or any other Indebtedness (other than Subordinated Indebtedness) extent of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (balance of such Net Available Cash after application in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereofclause (a), plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any such Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means within 360 days from the later of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash from the date of such commitment with Asset Disposition or the good faith expectation that an amount equal to receipt of such Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); orCash;
(iiic) to redeem Securities pursuant to the optional redemption provisions of this Indenture; and
(d) any combination of the foregoing; provided provided, that (1) pending the final application of the amount of any such Net Available Cash pursuant to this Section 3.5in accordance with clause (a), (b), (c) or (d) above, the Company or the applicable and its Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in Additional Assets prior to receiving the Indenture. Any Net Available Cash attributable to any given from Asset Disposition (Dispositions that are not applied or invested as provided that such investment in the preceding paragraph shall be made no earlier than deemed to constitute "Excess Proceeds." On the earliest of written notice to the Trustee of the relevant 361st day after an Asset Disposition, execution of a definitive agreement for if 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such aggregate amount of Net Available Cash that are less than or equal to Excess Proceeds exceeds $60.0 15.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “Excess Proceeds”), then, subject to the limitations with respect to Foreign Dispositions set forth below, the Company shall be required to make an offer (an “"Asset Disposition Offer”") no later than 10 Business Days after the expiration of the Proceeds Application Period to all Holders of Notes and, if Securities and to the extent required by the terms of any other Pari Passu Indebtedness, to all holders of other Pari Passu Indebtedness outstanding with similar provisions requiring the Company to make an offer to purchase such Pari Passu IndebtednessIndebtedness with the proceeds from any Asset Disposition ("Pari Passu Notes"), to purchase the maximum principal amount of Securities and any such Notes and Pari Passu Indebtedness, as appropriate, on a pro rata basis, Notes to which the Asset Disposition Offer applies that may be purchased out of such the Excess Proceeds, if any, at an offer price, in the case of the Notes, price in cash in an amount equal to 100% of the principal amount thereof (or accreted value thereof, if less), of the Securities and Pari Passu Notes plus accrued and unpaid interest, if any (or such lesser price with respect interest 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 offerpurchase, in accordance with the procedures set forth in this Indenture and or the agreement agreements governing the Pari Passu IndebtednessNotes, as applicable, in minimum denominations of $2,000 and each case in integral multiples of $1,000 in excess thereof1,000. 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 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 Securities and Pari Passu Indebtedness Notes so validly tendered or otherwise surrendered in connection with and not properly withdrawn pursuant to 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 OfferExcess Proceeds, the Company may include use any remaining Excess Proceeds (orfor general corporate purposes, subject to the other covenants contained in the case of an Advance Offer, the Advance Portion) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Securities surrendered by Holders thereof and other Pari Passu Indebtedness validly tendered pursuant to any Asset Disposition Offer Notes surrendered by holders or lenders, collectively, exceeds the amount of Excess Proceeds (or, in the case of an Advance OfferProceeds, the Advance Portion), Trustee shall select the Company shall allocate the Excess Proceeds among the Notes Securities and Pari Passu Indebtedness Notes to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes Securities and such Pari Passu Indebtedness; provided that no Notes or other Pari Passu Indebtedness will be selected and purchased in an unauthorized denominationNotes. Upon completion of any such Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions . The Asset Disposition Offer shall remain open for a period of this Section 3.5,
(i) 20 Business Days following its commencement, except to the extent that any of or all a longer period is required by applicable law (the Net Available Cash of any "Asset Disposition by a Foreign Subsidiary or a CFC Holding Company Offer Period"). No later than five Business Days after the termination of the Asset Disposition Offer Period (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"Asset Disposition Purchase Date"), the portion Company shall purchase the principal amount of such Net Available Cash so affected will not be Securities and Pari Passu Notes required to be applied purchased pursuant to this covenant (the "Asset Disposition Offer Amount") or, if less than the Asset Disposition Offer Amount has been so validly tendered, all Securities and Pari Passu Notes validly tendered in compliance with this Section 3.5response to 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 shall be paid to the Person in whose name a Security is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Securities pursuant to the Asset Disposition Offer. 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 Securities and Pari Passu Notes or portions of Securities 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 Securities and Pari Passu Notes so validly tendered and not properly withdrawn, in each case in integral multiples of $1,000. The Company shall deliver to the Trustee an Officers' Certificate stating that such amounts may be retained Securities or portions thereof were accepted for payment by the applicable Foreign Subsidiary Company in accordance with the terms of this covenant and, in addition, the Company shall deliver all certificates and notes required, if any, by the agreements governing the Pari Passu Notes. The Company or CFC Holding Company so long, but only so longthe Paying Agent, as the applicable local law or regulationcase may be, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and such repatriated Net Available Cash will be shall promptly (and but in any event case not later than five Business Days after such repatriation could be madetermination of the Asset Disposition Offer Period) applied (net mail or deliver to each tendering Holder of additional Taxes payable Securities or reserved against holder or lender of Pari Passu Notes, as a result thereof) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
(ii) the case may be, an amount equal to the extent that purchase price of the Securities 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 has determined in good faith that repatriation offor purchase, or and the Company will promptly issue a new Security, and the Trustee, upon delivery of an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so Officers' Certificate from the Company, shall authenticate and mail or deliver such new Security to such Holder, in a principal amount equal to any Restricted Subsidiary, unpurchased portion of the Security surrendered; provided that each such new Security shall be in a principal amount of $1,000 or any an integral multiple of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax$1,000. In addition, the Net Available Cash so affected may be retained Company shall take any and all other actions required by the applicable Foreign Subsidiary agreements governing the Pari Passu Notes. Any Security not so accepted shall be promptly mailed or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require delivered by the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from Holder thereof. The Company shall publicly announce the determination results of the amount of any mandatory prepayments hereunder)Asset Disposition Offer on the Asset Disposition Purchase Date. The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereofthis covenant, the following will shall be deemed to be cash:
(1) the assumption by the transferee of Indebtedness (other than Subordinated Obligations or other liabilities, contingent or otherwise Disqualified Stock) of the Company or Indebtedness of a Restricted Wholly-Owned Subsidiary (other than Guarantor Subordinated Indebtedness Obligations or Disqualified Stock of the Company or any Wholly-Owned Subsidiary that is a Subsidiary Guarantor) and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;Disposition (in which case the Company will, without further action, be deemed to have applied such deemed cash to Indebtedness in accordance with clause (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 converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 45 days following the closing of such Asset Disposition. The Company shall not, and shall not permit any Restricted Subsidiary to, engage in any Asset Swaps, unless:
(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;
(32) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of in the event such Asset Disposition, to Swap involves the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition; and
(4) any Designated Non-Cash Consideration received transfer by the Company or any Restricted Subsidiary in such Asset Dispositions of assets having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstandingas determined by the Board of Directors of the Company in good faith, not to exceed in excess of $5.0 million, the greater terms of such Asset Swap have been approved by a majority of the members of the Board of Directors of the Company; and
(a3) $100.0 million and (b) 7.5% in the event such Asset Swap involves the transfer by the Company or any Restricted Subsidiary of LTM EBITDA (with the assets having an aggregate fair market value value, as determined by the Board of each item Directors of Designated Non-Cash Consideration being measured at the time Company in good faith, in excess of $10.0 million, the Company has received and without giving effect a written opinion from an independent investment banking firm of nationally recognized standing that such Asset Swap is fair to subsequent changes in value).
(e) the Company or such Restricted Subsidiary, as the case may be, from a financial point of view. The Company will comply shall comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Indenture. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this Indenturecovenant, the Company will shall comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture by virtue thereofof any conflict.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Indenture (Cornell Companies Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make directly or indirectly, consummate any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the 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 or such fair market value to be determined on Subsidiary as the date of contractually agreeing to such Asset Disposition) case may be, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), and at least 7570% of the consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) thereof received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalentscash equivalents; and
(32) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company (or any Restricted such Subsidiary, as the case may be) (A) first, to the extent the Company elects (or is required by the terms of any Senior Indebtedness), to repay prepay, repay, redeem or purchase Senior Indebtedness or Indebtedness (iother than any Disqualified Stock) Obligations under of a Debt Facility Wholly Owned 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 such Asset Disposition or the receipt of such Net Available Cash; (B) second, to the extent of the balance of such Obligations were Incurred under Net Available Cash after application in accordance with clause (1) A), to the extent the Company elects, to acquire Additional Assets within one year from the later of the second paragraph under Section 3.2 date 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 97 EXECUTION 107 with clauses (A) and (B), to make an offer to the holders of the 9% Notes to purchase the 9% Notes pursuant to and subject to the conditions contained in the Indenture relating thereto; and (D) fourth, to the extent of the balance of such Net Available Cash after application in accordance with clauses (A), (B) and (C), to cause the Note Issuer to make an offer to the Holders of the Securities and the USD Securities on a pro rata basis (determined in accordance with the respective outstanding principal amounts thereof at the time of such offer, as calculated by reference to an exchange rate of 1.8237 DM per $1.00) to purchase the Securities and the USD Securities pursuant to and subject to the conditions contained in the Indenture (in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); the Securities) and in the USD Indenture (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretothe USD Securities); provided provided, however, that in connection with any prepayment, repayment or purchase of Indebtedness pursuant to clause (A), (C) or (D) above, the Company or such Restricted Subsidiary will shall retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will 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; (iii) Obligations under . Notwithstanding the Notes or any other Indebtedness (other than Subordinated Indebtedness) foregoing provisions of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notesthis paragraph, the Company will either (1) reduce Obligations under and the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may Subsidiaries shall not be below par), or (2) make an offer (required to apply any Net Available Cash in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) this paragraph except to the extent that the Company or any Restricted Subsidiary elects, to invest in or commit to invest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of Net Available Cash received by the Company or another Restricted Subsidiary); provided, however, that a binding agreement shall be treated as a permitted application of aggregate Net Available Cash from the date of such commitment all Asset Dispositions which are not applied in accordance with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final this paragraph exceeds $20,000,000. Pending application of the amount of any such Net Available Cash pursuant to this Section 3.5covenant, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset DispositionPermitted Investments. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereofthis covenant, the following will be are deemed to be cash:
cash or cash equivalents: (1x) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) any Subsidiary and the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
Disposition and (2y) securities, notes or other obligations securities 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 or Cash Equivalentscash.
(b) In the event of an Asset Disposition that requires the purchase of the Securities pursuant to clause (a)(2)(D) above, or the Note Issuer will purchase the Securities tendered pursuant to an offer by the Note Issuer for the Securities at a purchase price of 100% of their terms are required principal amount (without premium) plus accrued but unpaid interest, by mailing a notice to be satisfied for cash and Cash Equivalents (each Holder with a copy to the extent of the cash or Cash Equivalents received), in each caseTrustee, within 180 30 days following the closing determination by or on behalf of the holders of the 9% Notes as to the amount of the 9% Notes to be purchased pursuant to the offer to repurchase the 9% Notes made pursuant to clause (a)(2)(C) above, stating:
(i) that an Asset Disposition that requires the purchase of the Securities pursuant to clause (a)(2)(D) above has occurred and that such Holder has a right to require the Note Issuer to repurchase Securities at a purchase price of 100% of their principal amount (without premium) plus accrued and unpaid interest in an amount not to exceed the balance of Net Available Cash from such Asset Disposition;
Disposition after application in accordance with clauses (3A), (B) Indebtedness and (C) of any Restricted Subsidiary this covenant and that is no longer a Restricted Subsidiary as a result the amount available for repurchase of such Asset Disposition, the Securities will be increased to the extent that the Company holders of the USD Securities do not 98 EXECUTION 108 accept the offer to repurchase the USD Securities made pursuant to clause (D) above and each other Restricted Subsidiary are released the applicable provisions of the USD Indenture;
(ii) the repurchase date (which shall be no earlier than 30 days not later than 60 days from the date such notice is mailed);
(iii) that the tendered Securities will be repurchased pro rata in the event of oversubscription; provided that the unrepurchased portion of the principal amount of any Guarantee of payment of Security shall be in an authorized denomination (which shall not be less than the minimum authorized denomination) for such Indebtedness Security;
(iv) the instructions determined by the Note Issuer, consistent with the covenant described hereunder, that a Holder must follow in connection with such Asset Dispositionorder to have its Securities purchased; and
(4v) any Designated Non-Cash Consideration received by that each Security shall be subject to repurchase only in the Company amount of DM 1,000 or any Restricted Subsidiary in integral multiples thereof. The Note Issuer shall not make such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received offer to purchase Securities pursuant to this Section 3.5 that covenant if the Net Available Cash available therefor is at that time outstandingless than $20,000,000 (which lesser amount shall be carried forward for purposes of determining whether such an offer is required with respect to any subsequent Asset Disposition). Each Security shall be subject to repurchase only in the amount of DM 1,000 or integral multiples thereof. Upon presentation of any Security repurchased in part only, not the Note Issuer shall execute and the Trustee shall authenticate and deliver to exceed the greater of (a) $100.0 million and (b) 7.5% of LTM EBITDA (with the fair market value of each item of Designated Non-Cash Consideration being measured Holder thereof, at the time received expense of the Note Issuer, a new Security (and without giving effect the Guarantors shall execute their Guaranties to subsequent changes be endorsed thereon) of authorized denominations, in value)aggregate principal amount equal to the unredeemed portion of the Security so presented and having the same Issue Date, Stated Maturity and terms. If a Global Security is so surrendered, such new Security will also be a new Global Security.
(ec) The Note Issuer shall, and the Company will comply shall cause the Note Issuer to, comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes Securities pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis covenant. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this Indenturecovenant, the Note Issuer shall, and the Company will shall cause the Note Issuer to, comply with the applicable securities laws, rules laws and regulations and shall not be deemed to have breached its obligations described in under this Indenture clause by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Senior Subordinated Indenture (Fresenius National Medical Care Holdings Inc)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall Borrower will not, and shall will not permit any of its Restricted Subsidiaries to, make any Asset Disposition unless:
(1) the Company Borrower or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 an Officer or the Board of Directors of the Borrower, of the shares and assets subject to such Asset Disposition (including, for the avoidance of doubt, if such Asset Disposition is a Permitted Asset Swap);; and
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition or such series of related Asset Dispositions (including excluding any consideration by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, other than Indebtedness), together with all other Asset Dispositions since the Issue Effective Date (except to the extent any such Asset Disposition was a Permitted Asset Swap) on a cumulative basis) basis received by the Company Borrower or such Restricted Subsidiary, as the case may be, is in the form of cash cash, Cash Equivalents or Temporary Cash Equivalents; andInvestments.
(3b) After the receipt of Net Available Cash from an Asset Disposition, the Borrower or a Restricted Subsidiary, as the case may be, may apply such Net Available Cash directly or indirectly (at the option of the Borrower or such Restricted Subsidiary):
(1) within 18 months 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of the such Net Available Cash from such Asset Disposition (as may be extended by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company prepay, repay, purchase or redeem any Restricted SubsidiarySenior Secured Indebtedness incurred under Section 4.04(b)(1); provided, as the case may behowever, elects (that, in connection with any prepayment, repayment or is required by the terms purchase of any IndebtednessIndebtedness pursuant to this Section 4.08(b)(1), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured Indebtedness of the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company Borrower or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) (except in the case of any revolving Indebtedness) to be permanently reduced in an amount equal to the principal amount so prepaid, repaid repaid, purchased or purchasedredeemed; (iiiii) Obligations under unless included in Section 4.08(b)(1)(i), to prepay, repay, purchase or redeem any Pari Passu Indebtedness of the Notes Borrower or any other Indebtedness Subsidiary Guarantor that is secured in whole or in part by a Lien on the Collateral (other than Subordinated Indebtedness) including by virtue of the Company Intercreditor Agreement or any Restricted Subsidiary; provided that if an Additional Intercreditor Agreement), which Lien ranks pari passu with the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than Liens securing the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis byObligations, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for price of no less more than 100% of the principal amount thereof, of such Pari Passu Indebtedness plus the amount of accrued but and unpaid interest, if any, thereon up interest to the principal amount date of Notes such prepayment, repayment, purchase or redemption, provided that the Borrower or such Subsidiary Guarantor, as applicable, shall prepay, redeem, repay or repurchase Pari Passu Indebtedness that is Public Debt pursuant to be repurchased this clause (which offer shall be deemed ii) only if the Borrower delivers a notice of prepayment with respect to be an Asset Disposition Offer for purposes hereofthe Pari Ratable Share of the Term Loans in accordance with Section 2.13(a)(ii) within the time period specified by Section 2.13(g) of this Agreement and thereafter complies with its obligations under Section 2.13(a)(iii); (iii) to prepay, repay, purchase or (iv) redeem any Indebtedness of a Restricted Subsidiary that is not a GuarantorSubsidiary Guarantor or any Indebtedness that is secured on assets which do not constitute Collateral (in each case, other than Subordinated Indebtedness of the Borrower or a Subsidiary Guarantor or Indebtedness owed to the Company Borrower or another any Restricted Subsidiary); or (iv) to prepay Loans pursuant to Section 2.12;
(ii2) to the extent the Company Borrower or any such Restricted Subsidiary elects, to invest in or purchase or commit to invest in or purchase Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company Borrower or another Restricted Subsidiary)) within 365 days from the later of (i) the date of such Asset Disposition and (ii) the receipt of such Net Available Cash; provided, however, that any such reinvestment in Additional Assets made pursuant to a definitive binding agreement shall be treated or a commitment approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as a permitted application of Net Available Cash from the date of such investment or commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment invest is consummated within 180 days of such 365th day;
(3) to make a capital expenditure within 365 days from the later of (A) the date of such Asset Disposition and (B) the receipt of such Net Available Cash; provided, however, that any such capital expenditure made pursuant to a definitive binding agreement or a commitment (an “Acceptable Commitment”)approved by the Board of Directors of the Borrower that is executed or approved within such time will satisfy this requirement, so long as such investment is consummated within 180 days of such 365th day; or
(iii4) any combination of the foregoing; provided that clauses (1) – (3) of Section 4.08(b), provided that, pending the final application of the amount of any such Net Available Cash pursuant to this in accordance with clauses (1), (2), (3) or (4) of Section 3.54.08(b), the Company or Borrower and the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply invest such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 accreted value thereof, if less), 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 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 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not 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 any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zeroAgreement.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof4.08(a)(2), the following will be deemed to be cash:
(1) the assumption by the transferee (or other extinguishment in connection with the transactions relating to such Asset Dispositions) of Indebtedness or and any other liabilities, contingent or otherwise liabilities (as recorded on the balance sheet of the Company Borrower or a any Restricted Subsidiary 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 Borrower’s or such Restricted Subsidiary’s balance sheet or in the footnotes thereof 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 Borrower) of the Borrower or any Restricted Subsidiary (other than Subordinated Indebtedness of the Company Borrower or a Subsidiary Guarantor) and the release of the Company Borrower or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company Borrower or any Restricted Subsidiary of the Company from the transferee that are converted by the Company Borrower or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company Borrower and each other Restricted Subsidiary (as applicable) are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) consideration consisting of Indebtedness of the Borrower or a Subsidiary Guarantor (other than Subordinated Indebtedness) received after the Effective Date from Persons who are not the Borrower or any Restricted Subsidiary; and
(45) any Designated Non-Cash Consideration received by the Company Borrower or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 4.08 that is at that time outstanding, not to exceed (at the time of the receipt of such Designated Non-Cash Consideration, or, at the Borrower’s option, at the time of contractually agreeing to such Asset Disposition) the greater of (a) $100.0 55 million and (b) 7.525% of LTM L2QA Pro Forma EBITDA (with the fair market value of each item of Designated Non-Cash Consideration being measured at the time received or, at the option of the Borrower, on the date of contractually agreeing to the relevant Asset Disposition and without giving effect to subsequent changes in value).
(e) The Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
Appears in 1 contract
Sources: Credit Agreement (Altice USA, Inc.)
Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall not, and shall not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
(1) the Company or such Restricted Subsidiary, as the case may be, receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the Asset Disposition 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 a Permitted Asset Swap);
(2) in any such Asset Disposition, or series of related Asset Dispositions (except to the extent the Asset Disposition is a Permitted Asset Swap), at least 75% of the consideration from such Asset Disposition in excess of the greater of $25.0 million and 8.0% of LTM EBITDA, together with all other Asset Dispositions since the Issue Date (on a cumulative basis), (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basis) received by the Company or such Restricted Subsidiary, as the case may be, is in the form of cash or Cash Equivalents; and
(3) within 18 months from the later of (A) the date 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 as set forth defined below, the “Proceeds Application Period”), an amount equal to the Net Available Cash (the “Applicable Proceeds”) is applied:
(i) , to the extent the Company or any Restricted Subsidiary, as the case may be, elects elects:
(i) (A) to reduce, prepay, repay or purchase any Secured Pari Passu Indebtedness, including the Notes and the Indebtedness under the Credit Agreement (or is required by any Refinancing Indebtedness in respect thereof), (B) to reduce, prepay, repay or purchase any other Secured Indebtedness other than Secured Pari Passu Indebtedness so long as the terms of proceeds are with respect to assets securing such Secured Indebtedness and not constituting Collateral; (C) to reduce, prepay, repay or purchase any Indebtednessother Secured Indebtedness or Pari Passu Indebtedness so long as the proceeds are with respect to assets not constituting Collateral and so long as the Company ratably repays the Notes, (D) to make an offer in accordance with the procedures set forth below for an Asset Disposition Offer (whether or not accepted), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph redeem Notes as described under Section 3.2 5.7 or purchase Notes through open-market purchases or in privately negotiated transactions, or (and in the case of revolving obligationsE) to reduce, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured prepay, repay or purchase any Indebtedness of a Non-Guarantor (in each case, other than Indebtedness owed to the Company or a Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect theretoany Restricted Subsidiary); provided that provided, however, that, in connection with any reduction, prepayment, repayment or purchase of Indebtedness pursuant to this clause (i), the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the related commitment (other than any such Indebtedness under obligations in respect of any asset-backed based credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so reduced, prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Company or another Restricted Subsidiary;
(ii) to the extent the Company or any Restricted Subsidiary elects, (A) 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 equal Subsidiary); or (B) to invest (including capital expenditures) in any one or more businesses, properties or assets that replace the businesses, properties and/or assets that are the subject of such Asset Disposition, with any such investment made by way of a capital or other lease valued at the present value of the minimum amount of Net Available Cash received payments under such lease (as reasonably determined by the Company or another Restricted SubsidiaryCompany); provided, however, that a binding agreement shall be treated as a permitted application of Net Available Cash Applicable Proceeds from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash Applicable Proceeds will be applied to satisfy such commitment within 180 days 6 months of such commitment (an “Acceptable Commitment”); provided, further, that if any Acceptable Commitment is later canceled or terminated for any reason before such amount is applied, then such Net Available Cash shall constitute Excess Proceeds; or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Applicable Proceeds pursuant to this Section 3.5, the Company or the applicable Restricted Subsidiaries may apply such Net Available Cash Applicable Proceeds temporarily to reduce Indebtedness under a revolving credit facility (including under the Senior Credit Facilities) or otherwise apply such Net Available Cash Applicable Proceeds in any manner not prohibited by this Indenture Indenture, and (2) the Company (or any Restricted Subsidiary, as the case may be) , may elect to invest in Additional Assets prior to receiving the Net Available Cash Applicable Proceeds attributable to any given Asset Disposition (provided that such investment shall be made no earlier than the earliest of written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. .
(b) If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash Applicable Proceeds in excess of the greater of $60.0 50.0 million and 15.0% of LTM EBITDA (such amount of Net Available Cash Applicable Proceeds that are less than or equal to the greater of $60.0 million50.0 million and 15.0% of LTM EBITDA, “Declined Excess Proceeds,” and such amount of Net Available Cash Applicable Proceeds that are in excess of the greater of $60.0 million50.0 million and 15.0% of LTM EBITDA, “Excess Proceeds”), then, 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 10 Business Days ten business days after the expiration of the Proceeds Application Period to all Holders of Notes and, if required by the terms of any Secured Pari Passu Indebtedness, to all holders of such Secured Pari Passu Indebtedness or, so long as the Excess Proceeds are with respect to assets not constituting Collateral, other Pari Passu Indebtedness, to purchase the maximum principal amount of such Notes and Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as appropriateapplicable, 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 Indebtedness was issued with original issue discount, 100% of the accreted value thereof, if less), plus accrued and unpaid interest, if any (or such lesser price with respect to such Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, 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 such Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, in minimum denominations of $2,000 and in integral multiples of $1,000 1 in excess thereof. Notices of an Asset Disposition Offer shall be sent by first 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 address, with a copy to the Trustee, 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 Applicable Proceeds 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 Applicable Proceeds (the “Advance Portion”) in advance of being required to do so by this Indenture.
(bc) To the extent that the aggregate amount (or accreted value, as applicable) of Notes and, if applicable, any other Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, validly tendered 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not otherwise prohibited by this Indenture. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, validly tendered pursuant to any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, to be purchased on a pro rata basis on the basis of the aggregate principal amount (or accreted value, as applicable) of tendered Notes and such Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable; provided that no Notes or other Secured Pari Passu Indebtedness or Pari Passu Indebtedness, as applicable, will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash Applicable Proceeds and Excess Proceeds shall be reset at zero.
(cd) To the extent that any portion of Net Available Cash payable in respect of the Notes is denominated in a currency other than Dollars, the amount thereof payable in respect of the Notes shall not exceed the net amount of funds in Dollars that is actually received by the Company upon converting such portion into Dollars.
(e) Notwithstanding any other provisions of this Section 3.5,
, (i) to the extent that any of or all the Net Available Cash of any Asset Disposition received or deemed to be received by a Foreign Subsidiary or a CFC Holding Company (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 impediments, in each case, from being repatriated to the United States, an amount equal to the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments to permit such repatriation), and if within one year following the date on which the respective payment would otherwise have been required required, such repatriation of any of such affected Net Available Cash is permitted under the applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and an amount equal to such repatriated Net Available Cash will be promptly (and in any event not later than five (5) Business Days after such repatriation could be made) applied (net of additional Taxes payable or reserved against as a result thereof, to the extent not already taken into account in the definition of “Net Available Cash”) (whether or not such repatriation actually occurs) in compliance with this Section 3.5; and
3.5 and (ii) to the extent that the Company has determined in good faith that repatriation of, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would could have an a non-de minimis adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so as determined by the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax), the Net Available Cash so affected may will not be retained by required to be applied in compliance with this Section 3.5 so long, but not so long, as non-de minimis Tax consequence could result from repatriation, or an obligation to repatriate, to the 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 or CFC Holding Companyregulation, applicable organizational documents or other impediments 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 will be promptly (and in any event not later than five Business Days after such repatriation could be made) applied (net of Taxes payable or reserved against as a result thereof, to the extent not already taken into account in the definition of “Net Available Cash”) (whether or not repatriation actually occurs) in compliance with this Section 3.5. For the avoidance of doubt, nothing in this covenant Section 3.5 shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(df) For the purposes of Section 3.5(a)(2) hereof), the following will shall be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise otherwise, of the Company or a Restricted Subsidiary (other than Subordinated Indebtedness of the Company or a Guarantor) and or the release of the Company or such Restricted Subsidiary from all liability on such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, to the extent that the Company and each other Restricted Subsidiary are released from any Guarantee of payment of such Indebtedness in connection with such Asset Disposition;
(4) (4) consideration consisting of Indebtedness of the Company (other than Subordinated Indebtedness) received after the Issue Date from Persons who are not the Company or any Restricted Subsidiary; and
(45) (5) any Designated Non-Cash Consideration received by the Company or any Restricted Subsidiary in such Asset Dispositions having an aggregate fair market value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstanding, not to exceed the greater of (a) $100.0 50.0 million and (b) 7.515.0% of LTM EBITDA (EBITDA, 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).
(eg) The Company will comply with Upon the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations thereunder to the extent those laws and regulations are applicable in connection with each repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may be. To the extent that the provisions of any securities laws, rules or regulations, including Rule 14e-1 under the Exchange Act, conflict with the provisions of this Indenture, the Company will comply with the applicable securities laws, rules and regulations and shall not be deemed to have breached its obligations described in this Indenture by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result commencement of an Asset Disposition may Offer, the Company shall send, or cause to be waived sent, by first class mail or modified with electronically, a notice to the written consent of 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 Holders of a majority in aggregate principal amount of the then outstanding Notes.Asset Disposition Offer. Any Asset Disposition Offer shall be made to all
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Limitation on Sales of Assets and Subsidiary Stock. (a) The Company shall will not, and shall will not permit any of its Restricted Subsidiaries Subsidiary to, make any Asset Disposition unless:
(1i) the Company or such Restricted Subsidiary, as the case may be, Subsidiary receives consideration (including by way of relief from, or by any other Person assuming responsibility for, any liabilities, contingent or otherwise) at the time of the such Asset Disposition 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) of the shares and assets subject to such Asset Disposition Disposition, as such fair market value may be determined (includingand shall be determined, for to the avoidance of doubt, if extent such Asset Disposition is a Permitted or any series of related Asset SwapDispositions involves aggregate consideration in excess of $20.0 million) in good faith by the Board of Directors, whose determination shall be conclusive (including as to the value of all non-cash consideration);,
(2ii) in the case of any such Asset Disposition, Disposition (or series of related Asset Dispositions (except to the extent the Asset Disposition is Dispositions) having a Permitted Asset Swap)fair market value of $20.0 million or more, at least 75% of the consideration therefor (including excluding, in the 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) from such Asset Disposition, together with all other Asset Dispositions since the Issue Date (on a cumulative basisthat are not Indebtedness) received by the Company or such Restricted Subsidiary, as the case may be, Subsidiary is in the form of cash or Cash Equivalents; cash, and
(3iii) within 18 months from the later of (A) the date of such Asset Disposition and (B) the receipt an amount equal to 100% of the Net Available Cash from such Asset Disposition (as may be extended is applied by an Acceptable Commitment as set forth below, the “Proceeds Application Period”), an amount equal to the Net Available Cash is applied:
(i) to the extent the Company (or any Restricted Subsidiary, as the case may be) as follows:
(A) first, either (x) to the extent the Company elects (or is required by the terms of any Bank Indebtedness), to repay (i) Obligations under a Debt Facility to the extent such Obligations were Incurred under clause (1) of the second paragraph under Section 3.2 (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); (ii) Obligations under Secured any Senior Indebtedness of the Company or a any Note Guarantor (and in the case of revolving obligations, to correspondingly reduce commitments with respect thereto); provided that the Company or such Restricted Subsidiary will retire such Indebtedness and (other than any such Indebtedness under any asset-backed credit facility (or any Refinancing Indebtedness in respect thereof) to the extent the assets sold or otherwise disposed of in connection with such Asset Disposition constituted “borrowing base assets”), and will cause the related commitment (if any) to be reduced in an amount equal to the principal amount so prepaid, repaid or purchased; (iii) Obligations under the Notes or any other Indebtedness (other than Subordinated Indebtedness) of the Company or any Restricted Subsidiary; provided that if the Company or any Restricted Subsidiary shall so repay any senior Indebtedness other than the Notes, the Company will either (1) reduce Obligations under the Notes on a pro rata basis by, at its option, (A) redeeming Notes as described under Section 5.6 or (B) purchasing Notes through open-market purchases or in arm’s-length privately negotiated transactions (which, in each case, may be below par), or (2) make an offer (in accordance with the procedures set forth below for an Asset Disposition Offer) to all Holders to purchase their Notes on a ratable basis with such other senior Indebtedness for no less than 100% of the principal amount thereof, plus the amount of accrued but unpaid interest, if any, thereon up to the principal amount of Notes to be repurchased (which offer shall be deemed to be an Asset Disposition Offer for purposes hereof); or (iv) Indebtedness of a Restricted Subsidiary that is not a Note Guarantor), to prepay, repay or purchase any such Indebtedness (in each case other than Indebtedness owed to the Company or another a Restricted Subsidiary;
) within 365 days after the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash, or (iiy) to the extent the Company or any such Restricted Subsidiary elects, to invest in or commit to invest reinvest in Additional Assets (including by means of an investment in Additional Assets by a Restricted Subsidiary equal to the amount of with Net Available Cash received by the Company or another Restricted Subsidiary) within 365 days from the later of the date of such Asset Disposition and the date of receipt of such Net Available Cash, or, if such reinvestment in Additional Assets is a project 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 after application in accordance with clause (A) above (such balance, the “Excess Proceeds”), to make an offer to purchase Notes and (to the extent the Company or such Restricted Subsidiary elects, or is required by the terms thereof) to purchase, redeem or repay any other Senior Indebtedness of the Company or a Restricted Subsidiary, pursuant and subject to Section 411(b) and Section 411(c) and the agreements governing such other Indebtedness; 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 Indenture) any general corporate purpose (including the repurchase, repayment or other acquisition or retirement of any Subordinated Obligations); provided, however, that a binding agreement shall be treated as a permitted application in connection with any prepayment, repayment or purchase of Net Available Cash from the date of such commitment with the good faith expectation that an amount equal to Net Available Cash will be applied to satisfy such commitment within 180 days of such commitment (an “Acceptable Commitment”); or
(iii) any combination of the foregoing; provided that (1) pending the final application of the amount of any such Net Available Cash Indebtedness pursuant to this Section 3.5clause (A)(x) or (B) above, the Company or such Restricted Subsidiary will retire such Indebtedness and will cause the applicable Restricted Subsidiaries may apply such Net Available Cash temporarily to reduce Indebtedness under a revolving credit facility related loan commitment (including under the Senior Credit Facilitiesif any) or otherwise apply such Net Available Cash in any manner not prohibited by this Indenture and (2) the Company (or any Restricted Subsidiary, as the case may be) may elect to invest in 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 written notice to the Trustee of the relevant Asset Disposition, 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 Asset Disposition. If, with respect to any Asset Disposition, at the expiration of the Proceeds Application Period with respect to such Asset Disposition, there remains Net Available Cash in excess of $60.0 million (such amount of Net Available Cash that are less than or equal to $60.0 million, “Declined Excess Proceeds,” and such amount of Net Available Cash that are in excess of $60.0 million, “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 10 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 permanently reduced in an amount equal to 100% of the principal amount thereof (so prepaid, repaid or accreted value thereof, if less), plus accrued and unpaid interest, if any (or such lesser price with respect to Pari Passu Indebtedness, if any, as may be provided by purchased. Notwithstanding the terms foregoing provisions of such other Indebtedness), to, but not includingthis Section 411, the date fixed for Company and the closing of such offer, Restricted Subsidiaries shall not be required to apply any Net Available Cash 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 Section 411 except 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 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 or otherwise surrendered Net Available Cash from all Asset Dispositions that is not applied in connection accordance 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) in Declined Excess Proceeds, and use such Declined Excess Proceeds for any purpose not otherwise prohibited by this IndentureSection 411 exceeds $25.0 million. If the aggregate principal amount (or accreted value, as applicable) of the Notes or, if applicable, Pari Passu Indebtedness validly tendered pursuant to any Asset Disposition Offer exceeds the amount of Excess Proceeds (or, in the case of an Advance Offer, the Advance Portion), the Company shall allocate the Excess Proceeds among the Notes and Pari Passu other Indebtedness to be purchased on a pro rata 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 Pari Passu Indebtedness will be selected and purchased in an unauthorized denomination. Upon completion of any Asset Disposition Offer, the amount of Net Available Cash and Excess Proceeds shall be reset at zero.
(c) Notwithstanding any other provisions of this Section 3.5,
(i) to the extent that any of or all the Net Available Cash of any Asset Disposition by a Foreign Subsidiary or a CFC Holding Company (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, the portion of such Net Available Cash 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 or CFC Holding Company so long, but only so long, as the applicable local law or regulation, applicable organizational documents or agreements or other impediments will not permit repatriation to the 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 or CFC Holding Company 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 or regulation, applicable organizational documents or other impediments 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 applicable local law, applicable organizational impediment or other impediment, such repatriation will be promptly effected and 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 reserved against as a result thereof) (whether or not such 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, or an obligation to repatriate, any of or all the Net Available Cash of any Foreign Disposition would have an adverse Tax consequence (which for the avoidance of doubt, includes, but is not limited to, any repatriation whereby doing so the Company, any Restricted Subsidiary, or any of their respective Affiliates and/or direct or indirect equity owners would incur a Tax liability, including receipt of a Tax dividend, deemed dividend pursuant to Code Section 956 or a withholding Tax, the Net Available Cash so affected may be retained by the applicable Foreign Subsidiary or CFC Holding Company. For the avoidance of doubt, nothing in this covenant shall require the Company to cause any amounts to be repatriated to the United States (whether or not such amounts are used in or excluded from the determination of the amount of any mandatory prepayments hereunder). The non-application of any prepayment amounts as a consequence of the foregoing provisions will not, for the avoidance of doubt, constitute a Default or an Event of Default.
(d) For the purposes of Section 3.5(a)(2) hereof, the following will be deemed to be cash:
(1) the assumption by the transferee of Indebtedness or other liabilities, contingent or otherwise of the Company or a Restricted Subsidiary validly tendered and not withdrawn (or otherwise subject to purchase, redemption or repayment) in connection with an offer pursuant to clause (iii) (B) above exceeds the Excess Proceeds, the Excess Proceeds will be apportioned between such Notes and such other than Subordinated Indebtedness of the Company or a GuarantorRestricted Subsidiary, with the portion of the Excess Proceeds payable in respect of such Notes to equal the lesser of (x) the Excess Proceeds amount multiplied by a fraction, the numerator of which is the outstanding principal amount of such Notes and the denominator of which is the sum of the outstanding principal amount of the Notes and the outstanding principal amount of the relevant other Indebtedness of the Company or a Restricted Subsidiary, and (y) the aggregate principal amount of Notes validly tendered and not withdrawn. For the purposes of clause (ii) of paragraph (a) above, the following are deemed to be cash: (1) Temporary Cash Investments and Cash Equivalents, (2) the assumption of Indebtedness 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 principal amount of such Indebtedness or other liability in connection with such Asset Disposition;
(2) securities, notes or other obligations received by the Company or any Restricted Subsidiary of the Company from the transferee that are converted by the Company or such Restricted Subsidiary into cash or Cash Equivalents, or by their terms are required to be satisfied for cash and Cash Equivalents (to the extent of the cash or Cash Equivalents received), in each case, within 180 days following the closing of such Asset Disposition;
(3) Indebtedness of any Restricted Subsidiary that is no longer a Restricted Subsidiary as a result of such Asset Disposition, 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; and
, (4) securities 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, (5) consideration consisting of Indebtedness of the Company or any Restricted Subsidiary and (6) any Designated Non-Cash Consideration received by the Company or any of its Restricted Subsidiary Subsidiaries in such an Asset Dispositions Disposition having an aggregate fair market valueFair Market Value, taken together with all other Designated Non-Cash Consideration received pursuant to this Section 3.5 that is at that time outstandingclause, not to exceed the greater of (a) $100.0 million and (b) 7.5an aggregate amount at any time outstanding equal to 3% of LTM EBITDA Consolidated Tangible Assets (with the fair market value Fair Market Value of each item of Designated Non-Cash Noncash Consideration being measured at the time received and without giving effect to subsequent changes in value).
(eb) In the event of an Asset Disposition that requires the purchase of Notes pursuant to Section 411(a)(iii)(B), the Company will be required to purchase Notes tendered pursuant to an offer by the Company for the Notes (the “Offer”) at a purchase price of 100% of their principal amount plus accrued and unpaid interest to the purchase date in accordance with the procedures (including prorating in the event of oversubscription) set forth in Section 411(c). If the aggregate purchase price of the Notes tendered pursuant to the Offer is less than the Net Available Cash allotted to the purchase of Notes, the remaining Net Available Cash will be available to the Company for use in accordance with Section 411(a)(iii)(B) (to repay other Indebtedness of the Company or a Restricted Subsidiary) or Section 411(a)(iii)(C). The Company shall not be required to make an Offer for Notes pursuant to this Section 411 if the Net Available Cash available therefor (after application of the proceeds as provided in Section 411(a)(iii)(A)) is less than $25.0 million for any particular Asset Disposition (which lesser amounts 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).
(c) The Company shall, not later than 45 days after the Company becomes obligated to make an Offer pursuant to this Section 411, mail a notice to each Holder with a copy to the Trustee stating: (1) that an Asset Disposition that requires the purchase of a portion of the Notes has occurred and that such Holder has the right (subject to the prorating described below) to require the Company to purchase a portion of such Holder’s Notes at a purchase price in cash equal to 100% of the principal amount thereof, plus accrued and unpaid interest, if any, to the date of purchase (subject to Section 307); (2) the circumstances and relevant facts and financial information regarding such Asset Disposition; (3) the repurchase 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 Company, consistent with this Section 411, that a Holder must follow in order to have its Notes purchased; and (5) the amount of the Offer. If, upon the expiration of the period for which the Offer remains open, the aggregate principal amount of Notes surrendered by Holders exceeds the amount of the Offer, 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 $2,000 or integral multiples of $1,000 in excess thereof, shall be purchased).
(d) The Company will comply comply, to the extent applicable, with the requirements of Rule 14e-1 under Section 14(e) of the Exchange Act and any other applicable securities laws and or regulations thereunder to the extent those laws and regulations are applicable in connection with each the repurchase of Notes pursuant to an Asset Disposition Offer or Advance Offer, as the case may bethis Section 411. To the extent that the provisions of any securities laws, rules laws or regulations, including Rule 14e-1 under the Exchange Act, regulations conflict with the provisions of this IndentureSection 411, the Company will comply with the applicable securities laws, rules laws and regulations and shall will not be deemed to have breached its obligations described in under this Indenture Section 411 by virtue thereof.
(f) The provisions of this Indenture relative to the Company’s obligation to make an offer to repurchase the Notes as a result of an Asset Disposition may be waived or modified with the written consent of the Holders of a majority in aggregate principal amount of the then outstanding Notes.
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