Exhibit 4.21
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R&B FALCON CORPORATION
, as Issuer
and
CHASE BANK OF TEXAS, NATIONAL ASSOCIATION
, as Trustee
INDENTURE
Dated as of December 22, 1998
$400,000,000
SERIES A AND SERIES B
9-1/8% SENIOR NOTES DUE 2003
9-1/2% SENIOR NOTES DUE 2008
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CROSS-REFERENCE TABLE*
TIA Section Indenture Section
310 (a)(1) 6.10
(a)(2) 6.10
(a)(3) N.A.
(a)(4) N.A.
(a)(5) 6.10
(b) 6.10; 7.01(b)
(c) N.A.
311 (a) 6.11
(b) 6.11
(c) N.A.
312 (a) 2.05
(b) 11.03
(c) 11.03
313 (a) 6.06
(b) 6.06
(c) 6.06
(d) 6.06
314 (a) 3.03
(b) N.A.
(c)(1) 11.04
(c)(2) 11.04
(c)(3) N.A.
(d) N.A.
(e) 11.05
(f) N.A.
315 (a) 6.01(b)
(b) 6.05
(c) 6.01(a)
(d) 6.01(c)
(e) 5.11
316 (a)(last sentence) 2.09
(a)(1)(A) 5.05
(a)(1)(B) 5.04
(a)(2) N.A.
(b) 5.07
(c) 8.04
317 (a)(1) 5.08
(a)(2) 5.09
(b) 2.04
318 (a) 10.01
318 (c) 10.01
N.A. means not applicable
* This Cross-Reference Table is not part of this Indenture
TABLE OF CONTENTS
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 Definitions 1
Section 1.02 Other Definitions 16
Section 1.03 Incorporation by Reference of
Trust Indenture Act 16
Section 1.04 Rules of Construction 17
ARTICLE II
THE SECURITIES
Section 2.01 Form and Dating 17
Section 2.02 Execution and Authentication 18
Section 2.03 Registrar and Paying Agent 19
Section 2.04 Paying Agent to Hold Money in Trust 20
Section 2.05 Holder Lists 20
Section 2.06 Transfer and Exchange 20
Section 2.07 Certificated Securities 24
Section 2.08 Replacement Securities 25
Section 2.09 Outstanding Securities 26
Section 2.10 Treasury Securities 26
Section 2.11 Temporary Securities 26
Section 2.12 Cancellation 27
Section 2.13 Defaulted Interest 27
Section 2.14 Persons Deemed Owners 27
ARTICLE III
COVENANTS
Section 3.01 Payment of Securities 27
Section 3.02 Maintenance of Office or Agency 28
Section 3.03 SEC Reports; Financial Statements 28
Section 3.04 Compliance Certificate 29
Section 3.05 Corporate Existence 29
Section 3.06 Maintenance of Properties 30
Section 3.07 Payment of Taxes and Other Claims 30
Section 3.08 Waiver of Stay, Extension or Usury Laws 30
Section 3.09 Limitation on Indebtedness 31
Section 3.10 Limitation on Sale/Leaseback Transactions 33
Section 3.11 Limitation on Liens 33
Section 3.12 Limitation on Restricted Payments 35
Section 3.13 Covenant Termination 37
Section 3.14 Registration Rights Agreement 37
ARTICLE IV
SUCCESSORS
Section 4.01 Limitations on Mergers and Consolidations 38
Section 4.02 Successor Corporation Substituted 38
ARTICLE V
DEFAULTS AND REMEDIES
Section 5.01 Events of Default 39
Section 5.02 Acceleration 41
Section 5.03 Other Remedies 41
Section 5.04 Waiver of Existing Defaults 42
Section 5.05 Control by Majority 42
Section 5.06 Limitations on Suits 42
Section 5.07 Rights of Holders to Receive Payment 43
Section 5.08 Collection Suit by Trustee 43
Section 5.09 Trustee May File Proofs of Claim 43
Section 5.10 Priorities 44
Section 5.11 Undertaking for Costs 44
ARTICLE VI
TRUSTEE
Section 6.01 Duties of Trustee 44
Section 6.02 Rights of Trustee 46
Section 6.03 Individual Rights of Trustee 47
Section 6.04 Trustee's Disclaimer 47
Section 6.05 Notice of Defaults 47
Section 6.06 Reports by Trustee to Holders 47
Section 6.07 Compensation and Indemnity 48
Section 6.08 Replacement of Trustee 48
Section 6.09 Successor Trustee by Merger, etc 49
Section 6.10 Eligibility; Disqualification 50
Section 6.11 Preferential Collection of
Claims Against Company 50
ARTICLE VII
DISCHARGE OF INDENTURE
Section 7.01 Termination of Company's Obligations 50
Section 7.02 Application of Trust Money 53
Section 7.03 Repayment to Company 53
Section 7.04 Reinstatement 53
ARTICLE VIII
AMENDMENTS
Section 8.01 Without Consent of Holders 54
Section 8.02 With Consent of Holders 55
Section 8.03 Compliance with Trust Indenture Act 56
Section 8.04 Revocation and Effect of Consents 56
Section 8.05 Notation on or Exchange of Securities 57
Section 8.06 Trustee to Sign Amendments, etc 57
ARTICLE IX
GUARANTEES OF SECURITIES
Section 9.01 Unconditional Guarantees 58
Section 9.02 Limitation of Guarantor's Liability 60
Section 9.03 Contribution 60
Section 9.04 Execution and Delivery of Guarantees 60
Section 9.05 Addition of Guarantors 61
Section 9.06 Release of Guarantee 61
Section 9.07 Consent to Jurisdiction and Service of Process 62
Section 9.08 Waiver of Immunity 62
Section 9.09 Judgment Currency 63
ARTICLE X
REDEMPTION
Section 10.01 Notices to Trustee 63
Section 10.02 Selection of Securities to be Redeemed 63
Section 10.03 Notices to Holders 64
Section 10.04 Effect of Notices of Redemption 65
Section 10.05 Deposit of Redemption Price 65
Section 10.06 Securities Redeemed in Part 65
Section 10.07 Optional Redemption 65
ARTICLE XI
MISCELLANEOUS
Section 11.01 Trust Indenture Act Controls 66
Section 11.02 Notices 66
Section 11.03 Communication by Holders with Other Holders 68
Section 11.04 Certificate and Opinion as to
Conditions Precedent 68
Section 11.05 Statements Required in Certificate or Opinion 69
Section 11.06 Rules by Trustee and Agents 69
Section 11.07 Legal Holidays 69
Section 11.08 No Recourse Against Others 69
Section 11.09 Governing Law 70
Section 11.10 No Adverse Interpretation of Other Agreements 70
Section 11.11 Successors 70
Section 11.12 Severability 70
Section 11.13 Counterpart Originals 70
Section 11.14 Table of Contents, Headings, etc 70
EXHIBITS
EXHIBIT A Form of 5-Year Security A-1
EXHIBIT B Form of 10-Year Security B-1
EXHIBIT C Form of Supplemental Indenture C-1
Indenture dated as of December 22, 1998 between R&B Falcon Corporation, a
Delaware corporation (the "Company"), and Chase Bank of Texas, National
Association, a national banking association (the "Trustee").
Each party agrees as follows for the benefit of the other parties and for
the equal and ratable benefit of the Holders of the Company's (i) 9-1/8%
Series A Senior Notes due 2003 (the "Series A 5-Year Securities") and 9-
1/8% Series B Senior Notes due 2003 (the "Series B 5-Year Securities" and
with the Series A 5-Year Securities, the "5-Year Securities") and (ii) 9-
1/2% Series A Senior Notes due 2008 (the "Series A 10-Year Securities")
and 9-1/2% Series B Senior Notes due 2008 (the "Series B 10-Year
Securities" and with the Series A 10-Year Securities, the "10-Year
Securities"). The Series A 5-Year Securities and the Series A 10-Year
Securities are collectively referred to herein as the "Series A
Securities", and the Series B 5-Year Securities and the Series B 10-Year
Securities are collectively referred to herein as the "Series B
Securities." In addition, each of the 5-Year Securities and the 10-Year
Securities shall constitute a "series" of Securities:
ARTICLE II
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.01 DefinitionsSection
"Acquired Indebtedness" means, with respect to any specified Person (i)
Indebtedness of any other Person existing at the time such other Person
is merged with or into or became a Subsidiary of such specified Person,
whether or not such Indebtedness is incurred in connection with, or in
contemplation of, such other Person merging with or into, or becoming a
Subsidiary of, such specified Person and (ii) Indebtedness secured by a
Lien encumbering any asset acquired by such specified Person.
"Adjusted Net Assets" of a Guarantor at any date means the lesser of (x)
the amount by which the fair value of the property of such Guarantor at
such date exceeds the total amount of liabilities, including, without
limitation, the probable amount of contingent liabilities (after giving
effect to all other fixed and contingent liabilities incurred or assumed
on such date) of such Guarantor at such date, but excluding liabilities
under the Guarantee of such Guarantor, and (y) the amount by which the
present fair saleable value of the assets of such Guarantor at such date
exceeds the amount that will be required to pay the probable liability of
such Guarantor on its debts (after giving effect to all other fixed and
contingent liabilities incurred or assumed on such date and after giving
effect to any collection from any Subsidiary of such Guarantor in respect
of any obligations of such Subsidiary under the Guarantee of such
Guarantor), excluding debt in respect of the Guarantee of such Guarantor,
as they become absolute and matured.
"Affiliate" of any specified Person means any Person directly or
indirectly controlling or controlled by, or under direct or indirect
common control with, such specified Person. For purposes of this
definition, "control" of a Person shall mean the power to direct the
management and policies of such Person, directly or indirectly, whether
through the ownership of voting securities, by contract or otherwise, and
the terms "controlling" and "controlled" shall have meanings correlative
to the foregoing. The Trustee may request and may conclusively rely upon
an Officers" Certificate to determine whether any Person is an Affiliate
of any specified Person.
"Agent" means any Registrar or Paying Agent.
"Attributable Indebtedness," when used with respect to any Sale/Leaseback
Transaction, means, as at the time of determination, the present value
(discounted at the rate set forth or implicit in the terms of the lease
included in such transaction) of the total obligations of the lessee for
rental payments (other than amounts required to be paid on account of
property taxes, maintenance, repairs, insurance, assessments, utilities,
operating and labor costs and other items which do not constitute
payments for property rights) during the remaining term of the lease
included in such Sale/Leaseback Transaction (including any period for
which such lease has been extended).
"Average Life" means, as of the date of determination, with respect to
any Indebtedness or Preferred Stock, the quotient obtained by dividing
(i) the sum of the products of numbers of years from the date of
determination to the dates of each successive scheduled principal payment
of such Indebtedness or redemption or similar payment with respect to
such Preferred Stock multiplied by the amount of such payment by (ii) the
sum of all such payments.
"Bankruptcy Law" means Title 11, U.S. Code or any similar federal, state
or foreign law for the relief of debtors.
"Board of Directors" means the Board of Directors of the Company or any
committee thereof duly authorized, with respect to any particular matter,
to act by or on behalf of the Board of Directors of the Company.
"Business Day" means any day that is not a Legal Holiday.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, rights to purchase, warrants or options (whether or not
currently exercisable), participations or other equivalents of or
interests in (however designated) the equity (which includes, but is not
limited to, common stock, preferred stock and partnership and joint
venture interests) of such Person (excluding any debt securities that are
convertible into, or exchangeable for, such equity).
"Capitalized Lease Obligation" of any Person means any obligation of such
Person to pay rent or other amounts under a lease of property, real or
personal, that is required to be capitalized for financial reporting
purposes in accordance with GAAP; and the amount of such obligation shall
be the capitalized amount thereof determined in accordance with GAAP.
"Cliffs Drilling Company" means Cliffs Drilling Company, a Delaware
corporation and a wholly-owned subsidiary of the Company.
"Cliffs Senior Notes" means $200 million aggregate principal amount of
10"% Senior Notes due 2003 of Cliffs Drilling Company.
"Common Equity" of any Person means and includes all Capital Stock of
such Person that is generally entitled (without regard to the occurrence
of any contingency) to (i) vote in the election of directors of such
Person, or (ii) if such Person is not a corporation, vote or otherwise
participate in the selection of the governing body, partners, managers or
others that will control the management and policies of such Person.
"Company" means the Person named as the "Company" in the first paragraph
of this instrument until a successor corporation shall have become such
pursuant to the applicable provisions of this Indenture, and thereafter
"Company" shall mean such successor corporation; provided, however, that
for purposes of any provision contained herein which is required by the
TIA, "Company" shall also mean each Guarantor, if any.
"Consolidated EBITDA Coverage Ratio" as of any date of determination
means the ratio of (a) the aggregate amount of EBITDA for the period of
the most recent four consecutive fiscal quarters ending at least 45 days
prior to the date of such determination to (b) Consolidated Interest
Expense for such four fiscal quarters; provided, however, that (i) if the
Company or any Restricted Subsidiary has Incurred any Indebtedness since
the beginning of such period that remains outstanding or if the
transaction giving rise to the need to calculate the Consolidated EBITDA
Coverage Ratio is an issuance of Indebtedness, or both, EBITDA and
Consolidated Interest Expense for such period shall be calculated after
giving effect on a pro forma basis to such Indebtedness as if such
Indebtedness had been issued on the first day of such period and the
discharge of any other Indebtedness repaid, repurchased, defeased or
otherwise discharged with the proceeds of such new Indebtedness as if
such discharge had occurred on the first day of such period, (ii) if
since the beginning of such period the Company or any Restricted
Subsidiary shall have made any asset disposition, the EBITDA for such
period shall be reduced by an amount equal to the EBITDA (if positive)
directly attributable to the assets which are the subject of such asset
disposition for such period, or increased by an amount equal to the
EBITDA (if negative), directly attributable thereto for such period, and
Consolidated Interest Expense for such period shall be reduced by an
amount equal to the Consolidated Interest Expense directly attributable
to any Indebtedness of the Company or any Restricted Subsidiary repaid,
repurchased, defeased or otherwise discharged with respect to the Company
and its continuing Restricted Subsidiaries in connection with such asset
dispositions for such period (or, if the Capital Stock of any Restricted
Subsidiary is sold, the Consolidated Interest Expense for such period
directly attributable to the Indebtedness of such Restricted Subsidiary
to the extent the Company and its continuing Subsidiaries are no longer
liable for such Indebtedness after such sale), (iii) if since the
beginning of such period the Company or any Restricted Subsidiary (by
merger or otherwise) shall have made an Investment in any Restricted
Subsidiary (or any Person which becomes a Restricted Subsidiary) or an
acquisition of assets, including any acquisition of assets occurring in
connection with a transaction causing a calculation to be made hereunder,
which constitutes all or substantially all of an operating unit of a
business, EBITDA and Consolidated Interest Expense for such period shall
be calculated after giving pro forma effect thereto (including the
issuance of any Indebtedness) as if such Investment or acquisition
occurred on the first day of such period, and (iv) if since the beginning
of such period any Person (that subsequently became a Restricted
Subsidiary or was merged with or into the Company or any Restricted
Subsidiary since the beginning of such period) shall have made any asset
disposition or any Investment that would have required an adjustment
pursuant to clause (ii) or (iii) above if made by the Company or a
Restricted Subsidiary during such period, EBITDA and Consolidated
Interest Expense for such period shall be calculated after giving pro
forma effect thereto as if such asset disposition or Investment occurred
on the first day of such period.
For purposes of this definition, whenever pro forma effect is to be
given to an acquisition of assets, the amount of income or earnings
relating thereto, and the amount of Consolidated Interest Expense
associated with any Indebtedness issued in connection therewith, the pro
forma calculations shall be determined in good faith by a responsible
financial or accounting Officer of the Company. If any Indebtedness
bears a floating rate of interest and is being given pro forma effect,
the interest of such Indebtedness shall be calculated as if the rate in
effect on the date of determination had been the applicable rate for the
entire period (taking into account any Interest Rate Protection Agreement
applicable to such Indebtedness if such Interest Rate Protection
Agreement has a remaining term in excess of 12 months).
For purposes of this definition, in the case of the acquisition
since the beginning of such period of a drilling rig, drillship or
similar vessel (or of a Restricted Subsidiary owning same) by the Company
or by a Restricted Subsidiary pursuant to a binding purchase agreement or
the delivery since the beginning of such period of a drilling rig,
drillship or similar vessel to the Company or a Restricted Subsidiary
pursuant to a binding construction contract, if such drilling rig,
drillship or similar vessel has been earning a day rate for at least one
full fiscal quarter under a binding drilling contract constituting a
Qualifying Contract, pro forma effect shall be given to the earnings
(losses) of such drilling rig, drillship or similar vessel as if such
drilling rig, drillship or similar vessel were acquired on the first day
of such period, by basing such earnings (losses) on the annualized (x)
historical revenues actually earned from such Qualifying Contract and (y)
actual expenses related thereto, in each case for each full quarter
during such period in which such drilling rig, drillship or similar
vessel was earning a day rate under such Qualifying Contract.
"Consolidated Interest Expense" means, for any period, the total interest
expense of the Company and its consolidated Restricted Subsidiaries,
plus, to the extent not included in such interest expense: (i) interest
expense attributable to Capitalized Lease Obligations; (ii) amortization
of debt discount and debt issuance cost; (iii) capitalized interest; (iv)
non-cash interest payments; (v) commissions, discounts and other fees and
charges owed with respect to letters of credit and bankers' acceptance
financing; (vi) net costs under Interest Rate Protection Agreements
(including amortization of fees); (vii) dividends in respect of any
Redeemable Stock held by Persons other than the Company or a Restricted
Subsidiary; (viii) interest expense attributable to deferred payment
obligations, and (ix) interest expense on Indebtedness of another Person
to the extent that such Indebtedness is guaranteed by the Company or a
Restricted Subsidiary.
"Consolidated Net Income" means, for any period, the net income of the
Company and its consolidated subsidiaries; provided, however, that there
shall not be included in such Consolidated Net Income (i) any net income
of any Person if such Person is not a Restricted Subsidiary, except that
(A) the Company's equity in the net income of any such Person for such
period shall be included in such Consolidated Net Income up to the
aggregate amount of cash actually distributed by such Person during such
period to the Company or a Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other distribution to
a Restricted Subsidiary, to the limitations contained in clause (iii)
below) and (B) the Company's equity in a net loss of any such Person for
such period shall be included in determining such Consolidated Net
Income, (ii) any net income of any Person acquired by the Company or a
Restricted Subsidiary in a pooling of interests transaction for any
period prior to the date of such acquisition, (iii) any net income of any
Restricted Subsidiary to the extent such Restricted Subsidiary is subject
to restrictions, directly or indirectly, on the payment of dividends or
the making of distributions by such Restricted Subsidiary, directly or
indirectly, to the Company, except that (A) the net income of Cliffs
Drilling Company shall be included notwithstanding the foregoing, (B) the
net income of a Restricted Subsidiary shall be included to the extent
such net income could be paid to the Company or a Restricted Subsidiary
by loans, advances, intercompany transfers, principal repayments or
otherwise, (C) the Company's equity in the net income of any such
Restricted Subsidiary for such period shall be included in such
Consolidated Net Income up to the aggregate amount of cash actually
distributed by such Restricted Subsidiary during such period to the
Company or another Restricted Subsidiary as a dividend or other
distribution (subject, in the case of a dividend or other distribution to
another Restricted Subsidiary, to the limitation contained in this
clause) and (D) the Company's equity in a net loss of any such Restricted
Subsidiary for such period shall be included in determining such
Consolidated Net Income, (iv) any gain (but not loss) realized upon the
sale or other disposition of any property, plant or equipment of the
Company or its consolidated subsidiaries (including pursuant to any
sale-and-leaseback arrangement) which is not sold or otherwise disposed
of in the ordinary course of business and any gain (but not loss)
realized upon the sale or other disposition of any Capital Stock of any
Person, (v) extraordinary, unusual or nonrecurring charges, (vi) charges
relating to the extinguishment of debt obligations of Falcon Drilling
Company and (vii) the cumulative effect of a change in accounting
principles.
"Consolidated Net Worth" of the Company means the consolidated
stockholders' equity of the Company and its Subsidiaries, as determined
in accordance with GAAP.
"Corporate Trust Office of the Trustee" means the office of the Trustee
at which the corporate trust business of the Trustee shall be principally
administered, which office shall initially be located at the address of
the Trustee specified in Section 11.02 hereof and may be located at such
other address as the Trustee may give notice to the Company.
"Credit Facilities" means, with respect to the Company or any Restricted
Subsidiary, one or more debt facilities or commercial paper facilities,
in each case with banks or other institutional lenders providing for
revolving credit loans, term loans, receivables financing (including
through the sale of receivables to such lenders or to special purpose
entities formed to borrow from such lenders against such receivables) or
letters of credit, in each case, as amended, restated, modified, renewed,
refunded, replaced or refinanced in whole or in part from time to time.
"Default" means any event, act or condition that is, or after notice or
the passage of time or both would be, an Event of Default.
"Depositary" means The Depository Trust Company, its nominees and their
respective successors.
"EBITDA" for any period means the Consolidated Net Income for such
period, plus the following (but without duplication) to the extent
deducted in calculating such Consolidated Net Income for such period: (i)
income tax expense, (ii) Consolidated Interest Expense, (iii)
depreciation expense and (iv) amortization expense.
"Exchange Act" means the Securities Exchange Act of 1934, as amended, and
any successor statute.
"Exchange Offer" means the offer that may be made by the Company pursuant
to a Registration Rights Agreement to exchange each series of the Series
B Securities for the corresponding series of Series A Securities.
"Exchange Offer Registration Statement" means a registration statement
under the Securities Act relating to an Exchange Offer, including the
related prospectus.
"Exchangeable Stock" means any Capital Stock which is exchangeable or
convertible into another security (other than Capital Stock of the
Company which is neither Exchangeable Stock nor Redeemable Stock).
"Funded Indebtedness" means all Indebtedness (including Indebtedness
incurred under any revolving credit, letter of credit or working capital
facility) that matures by its terms, or that is renewable at the option
of any obligor thereon to a date, more than one year after the date on
which such Indebtedness is originally incurred.
"GAAP" means generally accepted accounting principles in the United
States set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public
Accountants and statements and pronouncements of the Financial Accounting
Standards Board or in such other statements by such other entity as may
be approved by a significant segment of the accounting profession of the
United States, as in effect from time to time.
"Guarantor" means (i) each Subsidiary of the Company that becomes a
guarantor of the Securities pursuant to Section 9.05 hereof, (ii) each
Subsidiary of the Company that executes a supplemental indenture in which
such Subsidiary agrees to be bound by Article IX hereof and (iii) any
Subsidiary of the Company that is a successor corporation of any
Subsidiary of the Company referred to in clauses (i) or (ii). The term
"Guarantor" shall not include any Subsidiary of the Company referred to
in clauses (i) through (iii) that shall have been released from its
obligations under Article IX pursuant to Section 9.06 hereof.
"Hedging Obligations" of any Person means the net obligations (not the
notional amount) of such Person pursuant to any interest rate swap
agreement, foreign currency exchange agreement, interest rate collar
agreement, option or futures contract or other similar agreement or
arrangement relating to interest rates or foreign exchange rates.
"Holder" means a Person in whose name a Security is registered.
"Incur" means issue, assume, guarantee, incur or otherwise become liable
for; provided, however, that any Indebtedness or Capital Stock of a
Person existing at the time such Person becomes a Subsidiary (whether by
merger, consolidation, acquisition or otherwise) shall be deemed to be
Incurred by such Subsidiary at the time it becomes a Subsidiary. The
term "Incurrence" when used as a noun shall have a correlative meaning.
"Indebtedness" of any Person at any date means, without duplication, (i)
all indebtedness of such Person for borrowed money (whether or not the
recourse of the lender is to the whole of the assets of such Person or
only to a portion thereof), (ii) all obligations of such Person evidenced
by bonds, debentures, notes or other similar instruments, (iii) all
obligations of such Person in respect of letters of credit or other
similar instruments (or reimbursement obligations with respect thereto),
other than standby letters of credit and performance bonds issued by such
Person in the ordinary course of business, to the extent not drawn or, to
the extent drawn, if such drawing is reimbursed not later than the third
Business Day following demand for reimbursement, (iv) all obligations of
such Person to pay the deferred and unpaid purchase price of property or
services, except trade payables and accrued expenses incurred in the
ordinary course of business, (v) all Capitalized Lease Obligations of
such Person, (vi) all Indebtedness of others secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by such
Person, to the extent of the fair market value of all the assets of such
Person subject to such Lien, (vii) all Indebtedness of others guaranteed
by such Person to the extent of such guarantee, (viii) Redeemable Stock,
valued at its maximum fixed repurchase price, and (ix) all Hedging
Obligations of such Person.
"Indenture" means this Indenture as amended or supplemented from time to
time.
"Independent Investment Banker" means an independent investment banking
institution of national standing appointed by the Company for purposes of
calculating any Make-Whole Premium, provided, that if the Company fails
to make such appointment at least 45 Business Days prior to the
Redemption Date for any Security to be redeemed, or if the institution so
appointed is unwilling or unable to make such calculation, such
calculation will be made by Credit Suisse First Boston Corporation or, if
such firm is unwilling or unable to make such calculation, by an
independent investment banking institution of national standing appointed
by the Trustee.
"Initial Purchasers" means Credit Suisse First Boston Corporation,
NationsBanc ▇▇▇▇▇▇▇▇▇▇ Securities LLC and Paribas Corporation, as initial
purchasers in the Offering.
"Interest Payment Date" shall have the meaning assigned to such term in
the Securities.
"Interest Rate Protection Agreement" means any interest rate swap
agreement, interest rate cap agreement or other financial agreement or
arrangement designed to protect the Company or any Restricted Subsidiary
against fluctuations in interest rates.
"Investment" in any Person means any direct or indirect advance, loan
(other than advances to customers in the ordinary course of business that
are recorded as accounts receivable on the balance sheet of the lender)
or other extensions of credit (including by way of guarantee or similar
arrangement) or capital contribution to (by means of any transfer of cash
or other property to others or any payment for property or services for
the account or use of others), or any purchase or acquisition of Capital
Stock, Indebtedness or other similar instruments issued by such Person.
For purposes of the definition of "Unrestricted Subsidiary," the
definition of "Restricted Payment" and Section 3.12, (i) "Investment"
shall include the portion (proportionate to the Company's equity interest
in such Subsidiary) of the fair market value of the net assets of any
Subsidiary of the Company at the time that such Subsidiary is designated
an Unrestricted Subsidiary; provided, however, that upon a redesignation
of such Subsidiary as a Restricted Subsidiary, the Company shall be
deemed to continue to have a permanent "Investment" in an Unrestricted
Subsidiary equal to an amount (if positive) equal to (x) the Company's
"Investment" in such Subsidiary at the time of such redesignation less
(y) the portion (proportionate to the Company's equity interest in such
Subsidiary) of the fair market value of the net assets of such Subsidiary
at the time of such redesignation, and (ii) any property transferred to
or from an Unrestricted Subsidiary shall be valued at its fair market
value at the time of such transfer, in each case as determined in good
faith by the Board of Directors.
"Investment Grade" means BBB- or above, in the case of S&P (or its
equivalent under any successor Rating Categories of S&P), Baa3 or above,
in the case of Moody's (or its equivalent under any successor Rating
Categories of Moody's), and the equivalent in respect of the Rating
Categories of any Rating Agencies substituted for S&P or Moody's.
"Issue Date" means the first date on which the Series A Securities are
issued under this Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in any of ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ or a place of
payment are authorized or obligated by law, regulation or executive order
to remain closed.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such
asset, whether or not filed, recorded or otherwise perfected under
applicable law. For the purposes of this Indenture, the Company or any
Subsidiary of the Company shall be deemed to own subject to a Lien any
asset which it has acquired or holds subject to the interest of a vendor
or lessor under any conditional sale agreement, Capitalized Lease
Obligation or other title retention agreement relating to such asset.
"Make-Whole Premium" means, with respect to any 5-Year Security or 10-
Year Security (or portion thereof) to be redeemed, an amount equal to
the excess, if any, of:
(i) the sum of the present values, calculated as of the Redemption
Date, of:
(A) each interest payment that, but for such redemption, would
have been payable on the Security (or portion thereof) being
redeemed on each Interest Payment Date occurring after the
Redemption Date (excluding any accrued and unpaid interest for
the period prior to the Redemption Date); and
(B) the principal amount that, but for such redemption, would
have been payable at the final maturity of the Security (or
portion thereof) being redeemed;
over
(ii) the principal amount of the Security (or portion thereof) being
redeemed.
The present values of interest and principal payments referred to in
clause (i) above will be determined in accordance with generally accepted
principles of financial analysis. Such present values will be calculated
by discounting the amount of each payment of interest or principal from
the date that each such payment would have been payable, but for the
redemption, to the Redemption Date at a discount rate equal to the
Treasury Yield plus (i) 50 basis points in the case of the 5-Year
Securities and (ii) 50 basis points in the case of the 10-Year Securities
The Make-Whole Premium will be calculated by an Independent Investment
Banker.
For purposes of determining the Make-Whole Premium, "Treasury Yield"
means a rate of interest per annum equal to the weekly average yield to
maturity of United States Treasury Notes that have a constant maturity
that corresponds to the remaining term to maturity of the Securities,
calculated to the nearest 1/12 of a year (the "Remaining Term"). The
Treasury Yield will be determined as of the third Business Day
immediately preceding the applicable Redemption Date.
The weekly average yields of United States Treasury Notes will be
determined by reference to the most recent statistical release published
by the Federal Reserve Bank of New York and designated "H.15(519)
Selected Interest Rates" or any successor release (the "H.15 Statistical
Release").
If the H.15 Statistical Release sets forth a weekly average yield for
United States Treasury Notes having a constant maturity that is the same
as the Remaining Term, then the Treasury Yield will be equal to such
weekly average yield. In all other cases, the Treasury Yield will be
calculated by interpolation, on a straight-line basis, between the weekly
average yields on the United States Treasury Notes that have a constant
maturity closest to and greater than the Remaining Term and the United
States Treasury Notes that have a constant maturity closest to and less
than the Remaining Term (in each case as set forth in the H.15
Statistical Release). Any weekly average yields so calculated by
interpolation will be rounded to the nearest 1/100 of 1%, with any figure
of 1/200% or above being rounded upward. If weekly average yields for
United States Treasury Notes are not available in the H.15 Statistical
Release or otherwise, then the Treasury Yield will be calculated by
interpolation of comparable rates selected by the Independent Investment
Banker.
"Moody's" means ▇▇▇▇▇'▇ Investors Service, Inc. and its successors.
"Net Cash Proceeds", with respect to any issuance or sale of Capital
Stock, means the cash proceeds of such issuance or sale net of attorneys'
fees, accountants' fees, underwriters' or placement agents' fees,
discounts or commissions and brokerage, consultant and other fees
actually incurred in connection with such issuance or sale and net of
taxes paid or payable as a result thereof.
"Net Proceeds" means, with respect to any Sale/Leaseback Transaction
entered into by the Company or any Subsidiary of the Company, the
aggregate net proceeds received by the Company or such Subsidiary from
such Sale/Leaseback Transaction after payment of expenses, taxes,
commissions and similar amounts incurred in connection therewith, whether
such proceeds are in cash or in property (valued at the fair market value
thereof at the time of receipt, as determined by the Board of Directors).
"Non-Convertible Capital Stock" means, with respect to any corporation,
any non-convertible Capital Stock of such corporation and any Capital
Stock of such corporation convertible solely into non-convertible common
stock of such corporation; provided, however, that Non-Convertible
Capital Stock shall not include any Redeemable Stock or Exchangeable
Stock.
"Non-Recourse Indebtedness" means Indebtedness or that portion of
Indebtedness of an Unrestricted Subsidiary as to which neither the
Company nor any Restricted Subsidiary (i) provides credit support
including any undertaking, agreement or instrument which would constitute
Indebtedness; or (ii) is directly or indirectly liable for such
Indebtedness.
"Offering" means the offering of the Original Securities pursuant to the
Offering Circular.
"Offering Circular" means the Offering Circular of the Company, dated
December 17, 1998, relating to the Offering.
"Officer" means the Chairman of the Board, the President, any Vice
Chairman of the Board, any Vice President, the Chief Financial Officer,
the Treasurer, any Assistant Treasurer, the Controller, the Secretary or
any Assistant Secretary of a Person.
"Officers' Certificate" means a certificate signed by two Officers of a
Person, one of whom must be the Person's Chief Executive Officer, Chief
Financial Officer or Chief Accounting Officer.
"Opinion of Counsel" means a written opinion from legal counsel who is
acceptable to the Trustee. Such counsel may be an employee of or counsel
to the Company, a Guarantor or the Trustee.
"Pari Passu Indebtedness" means any Indebtedness of the Company, whether
outstanding on the Issue Date or thereafter created, incurred or assumed,
unless, in the case of any particular Indebtedness, the instrument
creating or evidencing the same or pursuant to which the same is
outstanding expressly provides that such Indebtedness shall be
subordinated in right of payment to the Securities.
"Permitted Investments" means (i) certificates of deposit, bankers
acceptances, time deposits, Eurocurrency deposits and similar types of
Investments routinely offered by commercial banks with final maturities
of one year or less issued by commercial banks having capital and surplus
in excess of $100 million, (ii) commercial paper issued by any
corporation, if such commercial paper has credit ratings of at ▇▇▇▇▇ "▇-
▇" ▇▇ S&P and at least "P-1" by Moody's, (iii) U.S. Government
Obligations with a maturity of four years or less, (iv) repurchase
obligations for instruments of the type described in clause (iii), (v)
shares of money market mutual or similar funds having assets in excess of
$100 million, (vi) payroll advances in the ordinary course of business,
(vii) other advances and loans to officers and employees of the Company
or any Restricted Subsidiary, so long as the aggregate principal amount
of such advances and loans does not exceed $500,000 at any one time
outstanding, (viii) Investments in any Person in the form of a capital
contribution of the Company's common stock, (ix) Investments made by the
Company in its Restricted Subsidiaries (or any Person that will be a
Restricted Subsidiary as a result of such Investment) or by a Restricted
Subsidiary in the Company or in one or more Restricted Subsidiaries (or
any Person that will be a Restricted Subsidiary as a result of such
Investment), (x) Investments in stock, obligations or securities received
in settlement of debts owing to the Company or any Restricted Subsidiary
as a result of bankruptcy or insolvency proceedings or upon the
foreclosure, perfection or enforcement of any Lien in favor of the
Company or any Restricted Subsidiary, in each case as to debt owing to
the Company or any Restricted Subsidiary that arose in the ordinary
course of business of the Company or any such Restricted Subsidiary, (xi)
Investments made in exchange for Indebtedness permitted by clauses (b)(4)
and (b)(5) of Section 3.09, (xii) Investments in the capital stock of
▇▇▇▇▇ ▇▇▇, a Norwegian corporation, in exchange for cash and non-cash
assets (the fair market value of which shall be determined in good faith
by the Board of Directors of the Company), in an aggregate amount not to
exceed $50 million at any time outstanding, (xiii) Investments consisting
of the redesignation of the Subsidiary owning or operating the drillships
Deepwater Millennium or Deepwater Frontier as an Unrestricted Subsidiary,
or the contribution, transfer or other disposition of the drillships
Deepwater Millennium and Deepwater Frontier and related equipment and
assets (including any drilling contract) by the Company or any Restricted
Subsidiary to a Person other than a Restricted Subsidiary, in connection
with the refinancing of the Indebtedness Incurred to finance the
construction of such drillships, (xiv) Investments in a Person other than
a Restricted Subsidiary for the purpose of financing the construction or
upgrade prior to delivery of the drillship Deepwater Frontier, the
drillship Deepwater Millennium or the semisubmersible RBS8M pursuant to
the terms of applicable construction and equipment installation
agreements and (xv) Investments in a Person other than a Restricted
Subsidiary for the purpose of financing the construction or upgrade of
new drilling rigs, drillships or similar vessels and related equipment,
in an aggregate amount not to exceed at any time outstanding (A) $100
million less (B) the aggregate amount of all payments actually made
pursuant to paragraph (xiv) of this definition that represent payments
for amounts in excess of the Company's estimated costs for the vessels
referred to therein, as in effect on the Issue Date; provided, however,
that at the time of such Investment, the Company or such Person has
entered into a Qualifying Contract with respect thereto.
"Person" means any individual, corporation, partnership, limited
liability company, limited or general partnership, joint venture,
incorporated or unincorporated association, joint-stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof or other entity of any kind.
"Preferred Stock", as applied to the Capital Stock of any corporation,
means Capital Stock of any class or classes (however designated) which is
preferred as to the payment of dividends, or as to the distribution of
assets upon any voluntary or involuntary liquidation or dissolution of
such corporation, over shares of Capital Stock of any other class of such
corporation.
"Private Exchange" means the offer by the Company, pursuant to the
Registration Rights Agreement, to the Initial Purchasers to issue and
deliver to each Initial Purchaser, in exchange for the Original
Securities held by the Initial Purchaser as part of its initial
distribution, a like aggregate principal amount of Private Exchange
Securities.
"Private Exchange Securities" means the Securities to be issued pursuant
to this Indenture to the Initial Purchasers in a Private Exchange.
"Purchase Agreement" means the Purchase Agreement, dated as of
December 17, 1998, among the Company and the Initial Purchasers.
"QIB" means a "qualified institutional buyer" as defined in Rule 144A.
"Qualifying Contract" with respect to a drilling rig, drillship or
similar vessel means a contract for the use thereof (i) between the
Company or a Restricted Subsidiary or, for the purpose of clause (xv) of
the definition of "Permitted Investments," a Person other than a
Restricted subsidiary, and a counterparty that, as certified in an
Officers' Certificate delivered to the Trustee in connection therewith,
is either generally recognized in the offshore drilling industry as a
major oil company or has an Investment Grade rating on its long-term debt
from Moody's or S&P's, (ii) having a minimum term of two years and (iii)
containing a minimum day rate for such drilling rig, drillship or similar
vessel.
"Rating Agencies" means (a) S&P and Moody's or (b) if S&P or Moody's or
both of them are not making ratings of the Securities publicly available,
a nationally recognized U.S. rating agency or agencies, as the cases may
be, selected by the Company, which will be substituted for S&P or Moody's
or both, as the case may be.
"Rating Categories" means (i) with respect to S&P, any of the following
categories (any of which may include a "+" or "`"): AAA, AA, A, BBB, BB,
B, CCC, CC, C and D (or equivalent successor categories), (ii) with
respect to Moody's, any of the following categories (any of which may
include a "1," "2" or "3"): Aaa, Aa, A, Baa, Ba, B, Caa, Ca, C and D (or
equivalent successor categories) and (iii) the equivalent of any such
categories of S&P or Moody's used by another Rating Agency, if
applicable.
"Redeemable Stock" means, with respect to any series of Securities, any
Capital Stock that, by its terms (or by the terms of any security into
which it is convertible, or for which it is exchangeable, in each case at
the option of the holder thereof), or upon the happening of any event,
matures or is mandatorily redeemable, pursuant to a sinking fund
obligation or otherwise, or redeemable at the option of the holder
thereof, in whole or in part, on or prior to the date on which the
Securities of such series mature. Notwithstanding the preceding
sentence, any Capital Stock that would constitute Redeemable Stock solely
because the holders thereof have the right to require the Company to
repurchase such Capital Stock upon the occurrence of a change of control
or an asset sale shall not constitute Redeemable Stock if the terms of
such Capital Stock provide that the Company may not repurchase or redeem
any such Capital Stock pursuant to such provisions unless such repurchase
or redemption complies with the provisions of Section 3.12.
"Redemption Date," when used with respect to any security to be redeemed,
means the date fixed for such redemption by or pursuant to this
Indenture.
"Redemption Price" shall have the meaning assigned to such term in the
Securities.
"Registration Rights Agreement" means that certain Registration Rights
Agreement, dated as of December 17, 1998, among the Company and the
Initial Purchasers relating to the Original Securities.
"Restricted Subsidiary" means any Subsidiary other than an Unrestricted
Subsidiary.
"Sale/Leaseback Transaction" means any arrangement with any Person
providing for the leasing by the Company or any Subsidiary of the
Company, for a period of more than three years, of any real or tangible
personal property, which property has been or is to be sold or
transferred by the Company or such Subsidiary to such Person in
contemplation of such leasing.
"SEC" means the Securities and Exchange Commission.
"Securities" means the Series A Securities and the Series B Securities.
For purposes of this Indenture, the term "Securities" shall, except where
the context otherwise requires, include any future Guarantees.
"Securities Act" means the Securities Act of 1933, as amended, and any
successor statute.
"Security Custodian" means the Trustee, as custodian with respect to the
Securities in global form, or any successor entity thereto.
"Series A Securities" means, collectively, the Company's (i) 9-1/8%
Series A Senior Notes due 2003 and (ii) 9-1/2% Series A Senior Notes due
2008 to be issued pursuant to this Indenture.
"Series B Securities" means, collectively, the Company's (i) 9-1/8%
Series B Senior Notes due 2003 and (ii) 9-1/2% Series B Senior Notes due
2008 to be issued pursuant to this Indenture in the Exchange Offer.
"Shelf Registration Statement" means the registration statement issued by
the Company, in connection with the offer and sale of Original Securities
or Private Exchange Securities, pursuant to the Registration Rights
Agreement.
"Significant Subsidiary" has the meaning set forth in Regulation S-X
under the Exchange Act.
"S&P" means Standard & Poor's Rating Service, a division of the ▇▇▇▇▇▇-
▇▇▇▇ Companies, Inc., and its successors.
"Stated Maturity" means, with respect to any security, the date specified
in such security as the fixed date on which the principal of such
security is due and payable, including pursuant to any mandatory
redemption provision (but excluding any provision providing for the
repurchase of such security at the option of the holder thereof upon the
happening of any contingency unless such contingency has occurred).
"Subordinated Obligation" means any Indebtedness of the Company (whether
outstanding on the date hereof or hereafter incurred) which is
subordinate or junior in right of payment to the Securities.
"Subsidiary" means, with respect to any Person (i) any corporation of
which more than 50% of the total voting power of all classes of the
Common Equity is owned by such Person directly or through one or more
other Subsidiaries of such Person, and (ii) any entity other than a
corporation at least a majority of the Common Equity of which is owned by
such Person directly or through one or more other Subsidiaries of such
Person.
"Tangible Property" means all land, buildings, machinery and equipment
and leasehold interests and improvements which would be reflected on a
balance sheet of the Company prepared in accordance with GAAP, excluding
(a) all rights, contracts and other intangible assets of any nature
whatsoever and (b) all inventories and other current assets.
"TIA" means the Trust Indenture Act of 1939, as amended (15 U.S.C.
Sections 77aaa-77bbbb), as in effect on the Issue Date.
"Transfer Restricted Securities" shall have the meaning assigned to such
term in the Registration Rights Agreement.
"Trust Officer" means any officer or assistant officer of the Trustee
assigned by the Trustee to administer any of its corporate trust matters.
"Trustee" means the party named as such above until a successor replaces
it in accordance with the applicable provisions of this Indenture and
thereafter means the successor serving hereunder.
"U.S. Government Obligations" means direct obligations of the United
States of America for the payment of which the full faith and credit of
the United States of America is pledged.
"Unrestricted Subsidiary" means (i) any Subsidiary of the Company that at
the time of determination will be designated an Unrestricted Subsidiary
by the Board of Directors of the Company as provided below and (ii) any
Subsidiary of an Unrestricted Subsidiary.
The Board of Directors of the Company may designate any Subsidiary
of the Company as an Unrestricted Subsidiary so long as (1) it has no
Indebtedness other than Non-Recourse Indebtedness; provided, however,
that notwithstanding any other provision of this Indenture, a Subsidiary
shall not fail to constitute an Unrestricted Subsidiary by reason of (A)
the guarantee by the Company or a Restricted Subsidiary in connection
with synthetic lease obligations Incurred to finance the construction or
upgrade of drilling rigs, drillships or similar vessels; and (B)
obligations of the Company or a Restricted Subsidiary relating to
Indebtedness of an Unrestricted Subsidiary if such Indebtedness
constituted a Permitted Investment or a Restricted Payment permitted by
the "Limitation on Restricted Payments" covenant at the time of its
Incurrence or at the time of designation of such Subsidiary as an
Unrestricted Subsidiary; and (2) after giving effect thereto, such
designation was permitted by the "Limitation on Restricted Payments"
covenant.
Any such designation by the Board of Directors of the Company shall
be evidenced to the Trustee by filing a resolution of the Board of
Directors with the Trustee giving effect to such designation. The Board
of Directors of the Company may designate any Unrestricted Subsidiary as
a Restricted Subsidiary if, immediately after giving effect to such
designation, (x) no Default or Event of Default shall have occurred and
be continuing and (y) the Company could incur $1.00 of additional
Indebtedness under Section 3.09(a).
Section 1.2Other Definitions
Term Defined in
Section
"Agent Members" 2.01(c)
"Authorized Agent" 9.07
"Custodian" 5.01
"DTC" 2.03
"Event of Default" 5.01
"Funding Guarantor" 9.03
"Global Security" 2.01(b)
"Guarantees" 9.01(a)
"Judgement Currency" 9.09
"Non-U.S. Guarantor" 9.07
"Original Securities" 2.02
"Paying Agent" 2.03
"Registrar" 2.03
"Regulation S" 2.01(b)
"Restricted Payment" 3.12
"Rule 144A" 2.01(b)
"Significant Subsidiary" 5.01
"Successor" 4.01
"Suspended Covenants" 3.13
Section I.3Incorporation by Reference of Trust Indenture Act
Whenever this Indenture refers to a provision of the TIA, the provision
is incorporated by reference in and made a part of this Indenture. The
following TIA terms used in this Indenture have the following meanings:
"commission" means the SEC.
"indenture securities" means the Securities.
"indenture security holder" means a Holder.
"indenture to be qualified" means this Indenture.
"indenture trustee" or "institutional trustee" means the Trustee.
"obligor" on the indenture securities means the Company and each
Guarantor.
All terms used in this Indenture that are defined by the TIA, defined by
a TIA reference to another statute or defined by an SEC rule under the
TIA have the meanings so assigned to them.
Section 1.04 Rules of ConstructionSection
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural
include the singular; and
(5) provisions apply to successive events and transactions.
ARTICLE II
THE SECURITIES
Section 2.01 Form and Dating
(a) General. The [ ]-Year Securities and the 10-Year Securities, any
notations thereon relating to the Guarantees and the Trustee's
certificate of authentication shall be substantially in the form of
Exhibits A and B, respectively, to this Indenture, the terms of which are
hereby incorporated into this Indenture. The Securities may have
notations, legends or endorsements required by law, securities exchange
rule, the Company's certificate of incorporation or bylaws, agreements to
which the Company is subject, if any, or usage (provided that any such
notation, legend or endorsement is in a form acceptable to the Company).
Each Security shall be dated the date of its authentication. The
Securities shall be in registered form without coupons and only in
denominations of $1,000 and any integral multiples thereof. The terms
and provisions contained in the Securities shall constitute, and are
hereby expressly made, a part of this Indenture and to the extent
applicable, the Company, the Guarantors, if any, and the Trustee, by
their execution and delivery of this Indenture, expressly agree to such
terms and provisions and to be bound thereby.
(b) Global Securities. Original Securities of any Series offered and
sold to a QIB in reliance on Rule 144A under the Securities Act ("Rule
144A") or in reliance on Regulation S under the Securities Act
("Regulation S"), in each case as provided in the Purchase Agreement,
shall be issued initially in the form of one or more permanent global
Securities in definitive, fully registered form without interest coupons
with the global securities legend and restricted securities legend set
forth in Section 2.06 (each, a "Global Security"), which shall be
deposited on behalf of the purchasers of the Original Securities
represented thereby with the Trustee, at its New York office, as
custodian for the Depositary (or with such other custodian as the
Depositary may direct), and registered in the name of the Depositary or a
nominee of the Depositary, duly executed by the Company and authenticated
by the Trustee as hereinafter provided. The aggregate principal amount of
the Global Securities may from time to time be increased or decreased by
adjustments made on the records of the Trustee and the Depositary or its
nominee as hereinafter provided.
(c) Book-entry Provisions. This Section 2.01(c) shall apply only to a
Global Security deposited with or on behalf of the Depositary.
The Company shall execute and the Trustee shall, in accordance with this
Section 2.01(c), authenticate and deliver initially one or more Global
Securities that (i) shall be registered in the name of the Depositary for
such Global Security or Global Securities or the nominee of such
Depositary and (ii) shall be delivered by the Trustee to such Depositary
or pursuant to such Depositary's instructions or held by the Trustee as
custodian for the Depositary.
Members of, or participants in, the Depositary ("Agent Members") shall
have no rights under this Indenture with respect to any Global Security
held on their behalf by the Depositary or by the Trustee as the custodian
of the Depositary or under such Global Security, and the Depositary may
be treated by the Company, the Trustee and any agent of the Company or
the Trustee as the absolute owner of such Global Security for all
purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the
Trustee from giving effect to any written certification, proxy or other
authorization furnished by the Depositary or impair, as between the
Depositary and its Agent Members, the operation of customary practices of
such Depositary governing the exercise of the rights of a holder of a
beneficial interest in any Global Security.
(d) Certificated Securities. Except as provided in this Section 2.01 or
Section 2.06 or 2.07, owners of beneficial interests in Global Securities
will not be entitled to receive physical delivery of certificated
Securities.
Section 2.02 Execution and Authentication
One Officer of the Company shall sign the Securities on behalf of the
Company by manual or facsimile signature. The Company's seal may be
impressed, affixed, imprinted or reproduced on the Securities and may be
in facsimile form.
If an Officer of the Company whose signature is on a Security no longer
holds that office at the time the Security is authenticated, the Security
shall be valid nevertheless.
A Security shall not be entitled to any benefit under this Indenture or
be valid or obligatory for any purpose until authenticated by the manual
signature of an authorized signatory of the Trustee, which signature
shall be conclusive evidence that the Security has been authenticated
under this Indenture.
The Trustee shall authenticate (i) for original issue on the Issue Date
each of (A) the 5-Year Series A Securities in the aggregate principal
amount of $100,000,000 and (B) the 10-Year Series A Securities in the
aggregate principal amount of $300,000,000 (collectively, the "Original
Securities"), and (ii) the Series B Securities for original issue,
pursuant to an Exchange Offer or Private Exchange, for a like principal
amount of Series A Securities, in each case, upon a written order of the
Company signed by one Officer of the Company. Such order shall specify
(a) the amount of the Securities of each series to be authenticated and
the date of original issue thereof, and (b) whether the Securities are
Series A Securities or Series B Securities. The aggregate principal
amount of Securities outstanding at any time may not exceed (i)
$100,000,000 in the case of the 5-Year Securities and (ii) $300,000,000
in the case of the 10-Year Securities, except as provided in Section 2.08
hereof.
The Trustee may appoint an authenticating agent acceptable to the Company
to authenticate Securities. Unless limited by the terms of such
appointment, an authenticating agent may authenticate Securities whenever
the Trustee may do so. Each reference in this Indenture to
authentication by the Trustee includes authentication by such agent. An
authenticating agent has the same rights as an Agent to deal with the
Company, or an Affiliate of any of them.
The Series A Securities of any series and the corresponding Series B
Securities of such series shall be considered collectively to be a single
class for all purposes of this Indenture, including, without limitations
waivers, amendments, redemptions and offers to purchase.
Section 2.03 Registrar and Paying Agent
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or exchange ("Registrar") and an
office or agency where Securities may be presented for payment ("Paying
Agent"). The Registrar shall keep a register of the Securities and of
their transfer and exchange. The Company may appoint one or more
co-registrars and one or more additional paying agents. The term
"Registrar" includes any co-registrar and the term "Paying Agent"
includes any additional paying agent.
The Company shall enter into an appropriate agency agreement with any
Registrar or Paying Agent not a party to this Indenture. The agreement
shall implement the provisions of this Indenture that relate to such
Agent. The Company shall notify the Trustee of the name and address of
any Agent not a party to this Indenture. The Company may change any
Paying Agent or Registrar without notice to any Holder. If the Company
fails to appoint or maintain another entity as Registrar or Paying Agent,
the Trustee shall act as such. The Company or any of its Subsidiaries
may act as Paying Agent or Registrar.
The Company initially appoints the Trustee as Registrar and Paying Agent.
The Company initially appoints The Depository Trust Company ("DTC") to
act as Depositary with respect each Global Security.
Section 2.04 Paying Agent to Hold Money in Trust
The Company shall require each Paying Agent other than the Trustee to
agree in writing that the Paying Agent will hold in trust for the benefit
of Holders or the Trustee all money held by the Paying Agent for the
payment of principal of or premium, if any, or interest on the
Securities, whether such money shall have been paid to it by the Company
or any Guarantor, and will notify the Trustee of any default by the
Company or any Guarantor in making any such payment. While any such
default continues, the Trustee may require a Paying Agent to pay all
money held by it to the Trustee and to account for any funds disbursed.
The Company at any time may require a Paying Agent to pay all money held
by it to the Trustee and to account for any funds disbursed. Upon
payment over to the Trustee and upon accounting for any funds disbursed,
the Paying Agent (if other than the Company or a Subsidiary of the
Company) shall have no further liability for the money. If the Company
or a Subsidiary of the Company acts as Paying Agent, it shall segregate
and hold in a separate trust fund for the benefit of the Holders all
money held by it as Paying Agent.
Section 2.05 Holder Lists
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and
addresses of Holders and shall otherwise comply with TIA Section 312(a).
If the Trustee is not the Registrar, the Company shall furnish to the
Trustee at least seven Business Days before each Interest Payment Date,
and at such other times as the Trustee may request in writing, a list in
such form and as of such date as the Trustee may reasonably require of
the names and addresses of Holders, and the Company shall otherwise
comply with TIA Section 312(a).
Section 2.06 Transfer and Exchange
(a) Transfer and Exchange of Global Securities. (i) The transfer and
exchange of Global Securities or beneficial interests therein shall be
effected through the Depositary, in accordance with this Indenture
(including applicable restrictions on transfer set forth herein, if any)
and the procedures of the Depositary therefor. A transferor of a
beneficial interest in a Global Security shall deliver to the Registrar a
written order given in accordance with the Depositary's procedures
containing information regarding the participant account of the
Depositary to be credited with a beneficial interest in the Global
Security. The Registrar shall, in accordance with such instructions,
instruct the Depositary to credit to the account of the Person specified
in such instructions a beneficial interest in the Global Security and to
debit the account of the Person making the transfer the beneficial
interest in the Global Security being transferred.
(ii) Notwithstanding any other provisions of this Indenture (other
than the provisions set forth in Section 2.07), a Global Security
may not be transferred as a whole except by the Depositary to a
nominee of the Depositary or by a nominee of the Depositary to the
Depositary or another nominee of the Depositary or by the Depositary
or any such nominee to a successor Depositary or a nominee of such
successor Depositary.
(iii) In the event that a Global Security is exchanged for
Securities in definitive registered form pursuant to this Section
2.06 or Section 2.07 of this Indenture, prior to the consummation of
an Exchange Offer or prior to or in a transfer made pursuant to an
effective Shelf Registration Statement with respect to such
Securities, such Securities may be exchanged only in accordance with
such procedures as are substantially consistent with the provisions
of this Section 2.06 (including the certification and other
requirements set forth on the reverse of the Original Securities
intended to ensure that such transfers comply with Rule 144A or
Regulation S, as the case may be, or are otherwise in compliance
with the requirements of the Securities Act) and such other
procedures as may from time to time be adopted by the Company.
(b) Legend.
(i) Except as permitted by the following paragraphs (ii), (iii) and
(iv), each Security certificate evidencing the Global Securities
(and all Securities issued in exchange therefor or in substitution
thereof) shall bear a legend in substantially the following form:
"THIS SECURITY (OR ITS PREDECESSOR) AND ANY GUARANTEE
THEREOF WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT
FROM REGISTRATION UNDER THE UNITED STATES SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"), AND THIS SECURITY
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED IN
THE ABSENCE OF SUCH REGISTRATION OR AN APPLICABLE
EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY
IS HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY
MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS
OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
144A.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE
HEREOF, AGREES FOR THE BENEFIT OF THE ISSUER THAT (A)
THIS SECURITY MAY BE OFFERED, RESOLD, PLEDGED OR
OTHERWISE TRANSFERRED ONLY (i) INSIDE THE UNITED
STATES TO A PERSON WHOM THE SELLER REASONABLY
BELIEVES IS A "QUALIFIED INSTITUTIONAL BUYER" (AS
DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A,
(ii) OUTSIDE THE UNITED STATES IN AN OFFSHORE
TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE
SECURITIES ACT, (iii) PURSUANT TO AN EXEMPTION FROM
REGISTRATION UNDER THE SECURITIES ACT PROVIDED BY
RULE 144 THEREUNDER (IF AVAILABLE), OR (iv) PURSUANT
TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE
SECURITIES ACT, IN EACH OF CASES (i) THROUGH (iv) IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES, AND (B) THE HOLDER WILL,
AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY
PURCHASER OF THIS SECURITY FROM IT OF THE RESALE
RESTRICTIONS REFERRED TO IN (A) ABOVE."
(ii) Upon any sale or transfer of a Transfer Restricted
Security (including any Transfer Restricted Security
represented by a Global Security) pursuant to Rule 144
under the Securities Act, in the case of any Transfer
Restricted Security that is represented by a Global
Security, the Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security for a
certificated Security that does not bear the legend set
forth above and rescind any restriction on the transfer of
such Transfer Restricted Security, if the Holder certifies
in writing to the Registrar that its request for such
exchange was made in reliance on Rule 144 (such
certification to be in the form set forth on the reverse
of the Security).
(iii) After a transfer of any Original Securities or
Private Exchange Securities during the period of the
effectiveness of and pursuant to a Shelf Registration
Statement with respect to such Original Securities or
Private Exchange Securities, as the case may be, all
requirements pertaining to legends on such Initial
Security or such Private Exchange Security will cease to
apply, the requirements requiring any such Initial
Security or such Private Exchange Security issued to
certain Holders be issued in global form will cease to
apply, and a certificated Original Security or Private
Exchange Security without legends will be available to the
transferee of the Holder of such Original Securities or
Private Exchange Securities upon exchange of such
transferring Holder's certificated Original Security or
Private Exchange Security or directions to transfer such
Holder's interest in the Global Security, as applicable.
(iv) Upon the consummation of a Registered Exchange Offer
with respect to the Original Securities pursuant to which
Holders of such Original Securities are offered Exchange
Securities in exchange for their Original Securities, all
requirements pertaining to such Original Securities that
Original Securities issued to certain Holders be issued in
global form will cease to apply and certificated Original
Securities with the restricted securities legend set forth
in Section 2.06(b) will be available to Holders of such
Original Securities that do not exchange their Original
Securities, and Exchange Securities in certificated or
global form will be available to Holders that exchange
such Original Securities in such Exchange Offer.
(v) Upon the consummation of a Private Exchange with
respect to the Original Securities pursuant to which
Holders of such Original Securities are offered Private
Exchange Securities in exchange for their Original
Securities, all requirements pertaining to such Original
Securities that Original Securities issued to certain
Holders be issued in global form will still apply, and
Private Exchange Securities in global form with the
Restricted Securities Legend set forth in Section 2.06(b)
will be available to Holders that exchange such Original
Securities in such Private Exchange.
(c) Cancellation or Adjustment of Global Security. At such time as all
beneficial interests in a Global Security have either been exchanged for
certificated Securities, redeemed, repurchased or canceled, such Global
Security shall be returned to the Depositary for cancellation or retained
and canceled by the Trustee. At any time prior to such cancellation, if
any beneficial interest in a Global Security is exchanged for
certificated Securities, redeemed, repurchased or canceled, the principal
amount of Securities represented by such Global Security shall be reduced
and an adjustment shall be made on the books and records of the Trustee
(if it is then the Securities Custodian for such Global Security) with
respect to such Global Security, by the Trustee or the Securities
Custodian, to reflect such reduction.
(d) Obligations with Respect to Transfers and Exchanges of Securities.
(i) To permit registrations of transfers and exchanges,
the Company shall execute and the Trustee shall
authenticate certificated Securities and Global Securities
at the Registrar's or co-registrar's request. No service
charge shall be made for any registration of transfer or
exchange, but the Company may require payment of a sum
sufficient to cover any transfer tax, assessments, or
similar governmental charge payable in connection
therewith (other than any such transfer taxes, assessments
or similar governmental charge payable upon exchange or
transfer pursuant to Sections 5.11, 8.05 and 10.06 of the
Indenture).
(ii) The Registrar or co-registrar shall not be required
to register the transfer of or exchange of (a) any
certificated Security selected for redemption in whole or
in part pursuant to Article X of this Indenture, except
the unredeemed portion of any certificated Security being
redeemed in part, or (b) any Security for a period
beginning 15 Business Days before the mailing of a notice
of an offer to repurchase or redeem Securities or 15
Business Days before an interest payment date.
(iii) Prior to the due presentation for registration
of transfer of any Security, the Company, the Trustee, the
Paying Agent, the Registrar or any co-registrar may deem
and treat the person in whose name a Security is
registered as the absolute owner of such Security for the
purpose of receiving payment of principal of and interest
on such Security and for all other purposes whatsoever,
whether or not such Security is overdue, and none of the
Company, the Trustee, the Paying Agent, the Registrar or
any co-registrar shall be affected by notice to the
contrary.
(iv) All Securities issued upon any transfer or exchange
pursuant to the terms of this Indenture shall evidence the
same debt and shall be entitled to the same benefits under
this Indenture as the Securities surrendered upon such
transfer or exchange.
(e) No Obligation of the Trustee.
(i) The Trustee shall have no responsibility or
obligation to any beneficial owner of a Global Security, a
member of, or a participant in the Depositary or other
Person with respect to the accuracy of the records of the
Depositary or its nominee or of any participant or member
thereof, with respect to any ownership interest in the
Securities or with respect to the delivery to any
participant, member, beneficial owner or other Person
(other than the Depositary) of any notice (including any
notice of redemption) or the payment of any amount, under
or with respect to such Securities. All notices and
communications to be given to the Holders and all payments
to be made to Holders under the Securities shall be given
or made only to or upon the order of the registered
Holders (which shall be the Depositary or its nominee in
the case of a Global Security). The rights of beneficial
owners in any Global Security shall be exercised only
through the Depositary subject to the applicable rules and
procedures of the Depositary. The Trustee may rely and
shall be fully protected in relying upon information
furnished by the Depositary with respect to its members,
participants and any beneficial owners.
(ii) The Trustee shall have no obligation or duty to
monitor, determine or inquire as to compliance with any
restrictions on transfer imposed under this Indenture or
under applicable law with respect to any transfer of any
interest in any Security (including any transfers between
or among Depositary participants, members or beneficial
owners in any Global Security) other than to require
delivery of such certificates and other documentation or
evidence as are expressly required by, and to do so if and
when expressly required by, the terms of this Indenture,
and to examine the same to determine substantial
compliance as to form with the express requirements
hereof.
Section 2.07 Certificated Securities
(a) A Global Security deposited with the Depositary or with the Trustee
as custodian for the Depositary pursuant to Section 2.01 shall be
transferred to the beneficial owners thereof in the form of certificated
Securities in an aggregate principal amount equal to the principal amount
of such Global Security, in exchange for such Global Security, only if
such transfer complies with Section 2.06 and (i) the Depositary notifies
the Company that it is unwilling or unable to continue as Depositary for
such Global Security or if at any time such Depositary ceases to be a
"clearing agency" registered under the Exchange Act and a successor
depositary is not appointed by the Company within 90 days of such notice,
or (ii) the Company, in its sole discretion, notifies the Trustee in
writing that it elects to cause the issuance of certificated Securities
under this Indenture.
(b) Any Global Security that is transferred to the beneficial owners
thereof pursuant to this Section shall be surrendered by the Depositary
to the Trustee at its office located in the Borough of Manhattan, The
City of New York, to be so transferred, in whole or from time to time in
part, without charge, and the Trustee shall authenticate and deliver,
upon such transfer of each portion of such Global Security, an equal
aggregate principal amount of certificated Original Securities of
authorized denominations. Any portion of a Global Security transferred
pursuant to this Section shall be executed, authenticated and delivered
only in denominations of $1,000 and any integral multiple thereof and
registered in such names as the Depositary shall direct. Any certificated
Initial Security delivered in exchange for an interest in the Global
Security shall, except as otherwise provided by Section 2.06(d), bear the
restricted securities legend set forth in Exhibit 1 hereto.
(c) Subject to the provisions of Section 2.06(b), the registered Holder
of a Global Security may grant proxies and otherwise authorize any
Person, including Agent Members and Persons that may hold interests
through Agent Members, to take any action which a Holder is entitled to
take under this Indenture or the Securities.
(d) In the event of the occurrence of either of the events specified in
Section 2.07(a), the Company will promptly make available to the Trustee
a reasonable supply of certificated Securities in definitive, fully
registered form without interest coupons.
(e) In the event that a certificated Security issued pursuant to this
Section 2.07 is exchanged for another certificated Security prior to the
consummation of an Exchange Offer or prior to or in a transfer made
pursuant to an effective Shelf Registration Statement with respect to
such Securities, such Securities may be exchanged only in accordance with
such procedures as are substantially consistent with the provisions of
(i) Section 2.06(a)(iii) (including the certification and other
requirements set forth on the reverse of the Original Securities intended
to ensure that such transfers comply with Rule 144A or Regulation S, as
the case may be, or are otherwise in compliance with the requirements of
the Securities Act) and such other procedures as may from time to time be
adopted by the Company and (ii) Section 2.06(b).
Section 2.08 Replacement Securities
If any mutilated Security is surrendered to the Trustee, or the Company
and the Trustee receive evidence to their satisfaction of the
destruction, loss or theft of any Security, the Company shall issue and
the Trustee shall authenticate a replacement Security if the Trustee's
requirements are met. If required by the Trustee, the Company or any
Guarantor, such Holder must furnish an indemnity bond that is sufficient
in the judgment of the Trustee, the Company and the Guarantors to protect
the Company, the Guarantors, the Trustee, any Agent or any authenticating
agent from any loss which any of them may suffer if a Security is
replaced. The Company, the Trustee and the Guarantors may charge for
their expenses in replacing a Security. If, after the delivery of such
replacement Security, a bona fide purchaser of the original Security in
lieu of which such replacement Security was issued presents for payment
or registration such original Security, the Trustee shall be entitled to
recover such replacement Security from the person to whom it was
delivered or any person taking therefrom, except a bona fide purchaser,
and shall be entitled to recover upon the security or indemnity provided
therefor to the extent of any loss, damage, cost or expense incurred by
the Trustee, the Company or any Guarantor in connection therewith.
Every replacement Security is an additional obligation of the Company and
the Guarantors.
Section 2.09 Outstanding Securities.
The Securities outstanding at any time are all the Securities
authenticated by the Trustee except for those canceled by it, those
delivered to it for cancellation, those reductions in the interest in a
Global Security effected by the Trustee hereunder and those described in
this Section 2.09 as not outstanding.
If a Security is replaced pursuant to Section 2.08 hereof, it ceases to
be outstanding unless the Trustee receives proof satisfactory to it that
the replaced Security is held by a bona fide purchaser.
If the principal amount of any Security is considered paid under Section
3.01 hereof, it ceases to be outstanding and interest on it ceases to
accrue.
A Security does not cease to be outstanding because the Company, a
Guarantor or an Affiliate of any of them holds the Security.
Section 2.10 Treasury Securities
In determining whether the Holders of the required principal amount of
Securities of any series have concurred in any direction, waiver or
consent, Securities owned by the Company, any Guarantor or an Affiliate
of any of them shall be disregarded, except that for the purpose of
determining whether the Trustee shall be protected in relying on any such
direction, waiver or consent, only Securities which the Trustee knows are
so owned shall be so disregarded.
Section 2.11 Temporary Securities
Until definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities.
Temporary Securities shall be substantially in the form of definitive
Securities, but may have variations that the Company considers
appropriate for temporary Securities. Without unreasonable delay, the
Company shall prepare and the Trustee shall authenticate definitive
Securities in exchange for temporary Securities. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same
benefits under this Indenture as definitive Securities.
Section 2.12 CancellationSection 2.12 Cancellation.
The Company or any Guarantor at any time may deliver Securities to the
Trustee for cancellation. The Registrar and the Paying Agent shall
forward to the Trustee any Securities surrendered to them for
registration of transfer, exchange or payment. The Trustee shall cancel
all Securities surrendered for registration of transfer, exchange,
payment, replacement or cancellation. Unless the Company shall direct
that canceled Securities be returned to it, after written notice to the
Company all canceled Securities held by the Trustee shall be disposed of
in accordance with the usual disposal procedures of the Trustee, and the
Trustee shall maintain a record of their disposal. The Company may not
issue new Securities to replace Securities that have been paid or that
have been delivered to the Trustee for cancellation.
Section 2.13 Defaulted Interest
If the Company defaults in a payment of interest on the Securities, it
shall pay the defaulted interest in any lawful manner plus, to the extent
lawful, interest on the defaulted interest, in each case at the rate
provided in the Securities and in Section 3.01 hereof. The Company may
pay the defaulted interest to the Persons who are Holders on a subsequent
special record date. At least 15 days before any special record date,
the Company (or the Trustee, in the name of and at the expense of the
Company) shall mail to Holders a notice that states the special record
date, the related payment date and the amount of such interest to be
paid.
Section 2.14 Persons Deemed Owners
The Company, the Trustee, any Agent and any authenticating agent may
treat the Person in whose name any Security is registered as the owner of
such Security for the purpose of receiving payments of principal of or
premium, if any, or interest on such Security and for all other purposes.
None of the Company, the Trustee, any Agent or any authenticating agent
shall be affected by any notice to the contrary.
ARTICLE III
COVENANTS
Section 3.01 Payment of Securities
The Company shall pay the principal of and premium, if any, and interest
(including additional interest, if any, required by the Registration
Rights Agreement referred to in Section 3.11 hereof) on the Securities on
the dates and in the manner provided in the Securities and in this
Indenture. Principal, premium, if any, and interest shall be considered
paid on the date due if the Paying Agent, other than the Company or a
Subsidiary of the Company, holds by 11:00 a.m., Eastern time, on that
date money deposited by the Company designated for and sufficient to pay
all principal, premium and interest then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal, and premium,
if any, at a rate equal to the then applicable interest rate on the
Securities to the extent lawful; and it shall pay interest (including
post-petition interest in any proceeding under any Bankruptcy Law) on
overdue installments of interest (without regard to any applicable grace
period) at the same rate to the extent lawful.
Section 3.02 Maintenance of Office or Agency
The Company will maintain, in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee, the
Registrar or the Paying Agent) where Securities may be presented for
registration of transfer or exchange, where Securities may be presented
for payment and where notices and demands to or upon the Company in
respect of the Securities and this Indenture may be served. Unless
otherwise designated by the Company by written notice to the Trustee,
such office or agency shall be the principal office of the agent of the
Trustee, in The City of New York which, on the date hereof, is located at
the address set forth in Section 11.02 hereof. The Company will give
prompt written notice to the Trustee of the location, and any change in
the location, of such office or agency. If at any time the Company shall
fail to maintain any such required office or agency or shall fail to
furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate
Trust Office of the Trustee.
The Company may also from time to time designate one or more other
offices or agencies where the Securities may be presented or surrendered
for any or all such purposes and may from time to time rescind such
designations; provided, however, that no such designation or rescission
shall in any manner relieve the Company of its obligation to maintain an
office or agency in the Borough of Manhattan, The City of New York for
such purposes. The Company will give prompt written notice to the
Trustee of any such designation or rescission and of any change in the
location of any such other office or agency. The Company hereby
designates the Corporate Trust Office of the Trustee as one such office
or agency of the Company in accordance with Section 2.03 hereof.
Section 3.03 SEC Reports; Financial Statements
(a) Notwithstanding that the Company may not be required to remain
subject to the reporting requirements of Section 13 or 15(d) of the
Exchange Act, the Company shall file with the SEC and provide the Trustee
and the Holders with such annual reports and such information, documents
and other reports specified in Sections 13 and 15(d) of the Exchange Act
within 15 days after the date it is required (or would otherwise have
been required) to file such reports, information and documents.
(b) In addition, whether or not required by the rules and regulations of
the SEC, the Company will file a copy of all such information and reports
with the SEC for public availability (unless the SEC will not accept such
filing). In addition, the Company shall furnish to the Holders and to
prospective investors, upon the requests of Holders, any information
required to be delivered pursuant to Rule 144A (d) (4) under the
Securities Act so long as the Securities are not freely transferable
under the Securities Act.
(c) The Company shall provide the Trustee with a sufficient number of
copies of all reports and other documents and information that the
Trustee may be required to deliver to Holders under this Section 3.03.
Section 3.04 Compliance Certificate
(a) The Company shall deliver to the Trustee, within 120 days after the
end of each fiscal year of the Company, a statement signed by two
Officers of the Company, which need not constitute an Officers'
Certificate, complying with TIA Section 314(a)(4) and stating that in the
course of performance by the signing Officers of the Company of their
duties as such Officers of the Company they would normally obtain
knowledge of the keeping, observing, performing and fulfilling by the
Company of its obligations under this Indenture, and further stating, as
to each such Officer signing such statement, that to the best of his
knowledge the Company and each Guarantor, if any, has kept, observed,
performed and fulfilled each and every covenant contained in this
Indenture and is not in default in the performance or observance of any
of the terms, provisions and conditions hereof (or, if a Default or Event
of Default shall have occurred, describing all such Defaults or Events of
Default of which such Officer may have knowledge and what action the
Company or such Guarantor, as the case may be, is taking or proposes to
take with respect thereto).
(b) The Company and the Guarantors, if any, shall, so long as any of the
Securities are outstanding, deliver to the Trustee, forthwith upon any
Officer of the Company or any Guarantor becoming aware of any Default or
Event of Default under this Indenture, an Officers' Certificate
specifying such Default or Event of Default and what action the Company
or such Guarantor is taking or proposes to take with respect thereto.
Section 3.05 Corporate Existence
Subject to Article IV hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect its
corporate existence and the corporate, partnership and other existence of
each of its Subsidiaries and all rights (charter and statutory) and
franchises of the Company and its Subsidiaries, provided that the Company
shall not be required to preserve the corporate existence of any
Subsidiary of the Company or any such right or franchise if the Board of
Directors shall determine that the preservation thereof is no longer
desirable in the conduct of the business of the Company and its
Subsidiaries taken as a whole and that the loss thereof would not have a
material adverse effect on the business, prospects, assets or financial
condition of the Company and its Subsidiaries taken as a whole and would
not have any material adverse effect on the payment and performance of
the obligations of the Company and the Guarantors under the Securities
and this Indenture.
Section 3.06 Maintenance of Properties
The Company shall cause all material properties owned by or leased to the
Company or any Subsidiary of the Company or used or held for use in the
conduct of its business or the business of any such Subsidiary to be
maintained and kept in good condition, repair and working order
(reasonable wear and tear and casualty losses excepted) and will cause to
be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company may be
necessary so that the business carried on in connection therewith may be
properly conducted at all times; provided that nothing in this Section
3.06 shall prevent the Company from discontinuing the operation or
maintenance of any of such properties if such discontinuance is, in the
judgment of the Company, desirable in the conduct of its business or the
business of any such Subsidiary and not disadvantageous in any material
respect to the Holders.
Section 3.07 Payment of Taxes and Other Claims
The Company will pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all material taxes,
assessments and governmental charges levied or imposed upon the Company
or any of its Subsidiaries or upon the income, profits or property of the
Company or any of its Subsidiaries, and (ii) all material lawful claims
for labor, materials and supplies which, if unpaid, might by law become a
Lien upon the property of the Company or any of its Subsidiaries;
provided that the Company shall not be required to pay or discharge or
cause to be paid or discharged any such tax, assessment, charge or claim
whose amount, applicability or validity is being contested in good faith,
and by appropriate proceedings.
Section 3.08 Waiver of Stay, Extension or Usury Laws
The Company and each Guarantor, if any, covenant (to the extent that they
may lawfully do so) that they will not at any time insist upon, or plead,
or in any manner whatsoever claim or take the benefit or advantage of,
any stay or extension law or any usury law or other law, which would
prohibit or forgive the Company or any Guarantor from paying all or any
portion of the principal of, or premium, if any, or interest on the
Securities as contemplated herein, wherever enacted, now or at any time
hereafter in force, or which may affect the covenants or the performance
of this Indenture; and (to the extent that they may lawfully do so) the
Company and each Guarantor hereby expressly waive all benefit or
advantage of any such law, and covenant that they will not hinder, delay
or impede the execution of any power herein granted to the Trustee, but
will suffer and permit the execution of every such power as though no
such law had been enacted.
Section 3.09 Limitation on Indebtedness
(a) The Company will not, and will not permit any Restricted Subsidiary
to, Incur, directly or indirectly, any Indebtedness; provided, however,
the Company may Incur Indebtedness if the pro forma Consolidated EBITDA
Coverage Ratio at the date of such Incurrence exceeds 2.25 to 1.0.
(b) Notwithstanding clause (a), the following Indebtedness may be
incurred:
(1) Indebtedness of the Company pursuant to one or more
Credit Facilities (and the guarantee of such Indebtedness
by Restricted Subsidiaries); provided, however, that the
aggregate amount of such Indebtedness outstanding at such
time shall not exceed $350 million;
(2) Indebtedness of the Company or a Restricted
Subsidiary owed to and held by a Restricted Subsidiary or
Indebtedness of a Restricted Subsidiary owed to and held
by the Company; provided, however, that any subsequent
issuance or transfer of any Capital Stock that results in
such Restricted Subsidiary to whom Indebtedness is owed
ceasing to be a Restricted Subsidiary or any transfer of
such Indebtedness (other than to the Company or another
Restricted Subsidiary) shall be deemed, in each case, to
constitute the Incurrence of such Indebtedness;
(3) The Securities and Indebtedness Incurred in exchange
for, or the proceeds of which are used to refund or
refinance, any Indebtedness permitted by this clause (3);
provided, however, that (i) the principal amount of the
Indebtedness so Incurred shall not exceed the principal
amount of the Indebtedness so exchanged, refunded or
refinanced (plus the amount of reasonable fees and
expenses incurred in connection therewith, including any
premium or defeasance costs) and (ii) the Indebtedness so
Incurred (A) shall not mature prior to the Stated Maturity
of the Indebtedness so exchanged, refunded or refinanced
and (B) shall have an Average Life equal to or greater
than the remaining Average Life of the Indebtedness so
exchanged, refunded or refinanced;
(4) Indebtedness of the Company or any Restricted
Subsidiary (other than Indebtedness described in clause
(1), (2) or (3) above) (x) outstanding on the Issue Date
(including without limitation, the Cliffs Senior Notes) or
Incurred pursuant to agreements as in effect on the Issue
Date and (y) Indebtedness Incurred in exchange for, or the
proceeds of which are used to refund or refinance, any
Indebtedness permitted by this clause (4) or permitted by
clause (a) above; provided, however, that (i) the
principal amount of the Indebtedness so Incurred shall not
exceed the principal amount of the Indebtedness so
exchanged, refunded or refinanced (plus the amount of
reasonable fees and expenses incurred in connection
therewith, including any premium or defeasance costs); and
(ii) the Indebtedness so Incurred (A) shall not mature
prior to the Stated Maturity of the Indebtedness so
exchanged, refunded or refinanced and (B) shall have an
Average Life equal to or greater than the remaining
Average Life of the Indebtedness so exchanged, refunded or
refinanced;
(5) Indebtedness of the Company or any Restricted
Subsidiary consisting of guarantees in connection with
any synthetic lease obligations of Persons Incurred to
finance the construction or upgrade of the drillship
Deepwater Frontier and the drillship Pathfinder pursuant
to agreements governing such obligations;
(6) Acquired Indebtedness of any Restricted Subsidiary in
an aggregate amount not to exceed $300 million, provided
that the Company on a pro forma basis could Incur $1.00 of
additional Indebtedness pursuant to paragraph (a) of this
covenant;
(7) Indebtedness of the Company or any Restricted
Subsidiary consisting of guarantees, indemnities or
obligations in respect of purchase price adjustments in
connection with the acquisition or disposition of assets,
including, without limitation, shares of Capital Stock;
(8) The Incurrence by the Company's Unrestricted
Subsidiaries of Non-Recourse Indebtedness; provided,
however, that if any such Indebtedness ceases to be Non-
Recourse Indebtedness of any Unrestricted Subsidiary,
subject to the definition of "Unrestricted Subsidiary",
such event shall be deemed to constitute an incurrence of
Indebtedness by a Restricted Subsidiary of the Company
that was not permitted by this clause (8);
(9) Obligations of the Company or a Restricted Subsidiary
under performance or surety bonds relating to building
contracts for the construction of drilling rigs,
drillships or similar vessels or contracts for the
installation of related equipment;
(10) Hedging Obligations; and
(11) Indebtedness of the Company or any Restricted
Subsidiary in an aggregate principal amount which,
together with all other Indebtedness of the Company then
outstanding (other than Indebtedness permitted by clauses
(1) through (10) of this paragraph (b) or paragraph (a))
does not exceed $50 million.
(c) Notwithstanding clauses (a) and (b), the Company shall not issue any
Indebtedness if the proceeds thereof are used, directly or indirectly, to
repay, prepay, redeem, defease, retire, refund or refinance any
Subordinated Obligations unless such Indebtedness shall be subordinated
to the Securities to at least the same extent as such Subordinated
Obligations.
Section 3.10 Limitation on Sale/Leaseback Transactions
The Company shall not, and shall not permit any Restricted Subsidiary of
the Company to, enter into any Sale/Leaseback Transaction with any Person
(other than the Company or a Restricted Subsidiary of the Company)
unless:
(a) the Company or such Restricted Subsidiary would be entitled to incur
Indebtedness, in a principal amount equal to the Attributable
Indebtedness with respect to such Sale/Leaseback Transaction, secured by
a Lien on the property subject to such Sale/Leaseback Transaction
pursuant to Section 3.10 hereof without equally and ratably securing the
Securities pursuant to such Section;
(b) after the Issue Date and within a period commencing six months prior
to the consummation of such Sale/Leaseback Transaction and ending six
months after the consummation thereof, the Company or such Restricted
Subsidiary shall have expended for property used or to be used in the
ordinary course of business of the Company and its Restricted
Subsidiaries an amount equal to all or a portion of the Net Proceeds of
such Sale/Leaseback Transaction and the Company shall have elected to
designate such amount as a credit against such Sale/Leaseback Transaction
(with any such amount not being so designated to be applied as set forth
in clause (c) below); or
(c) the Company, during the 12-month period after the effective date of
such Sale/Leaseback Transaction, shall have applied to the voluntary
defeasance or retirement of Securities or any Pari Passu Indebtedness an
amount equal to the greater of the Net Proceeds of the sale or transfer
of the property leased in such Sale/Leaseback Transaction and the fair
value, as determined by the Board of Directors, of such property at the
time of entering into such Sale/Leaseback Transaction (in either case
adjusted to reflect the remaining term of the lease and any amount
expended by the Company as set forth in clause (b) above), less an amount
equal to the principal amount of Securities and Pari Passu Indebtedness
voluntarily defeased or retired by the Company within such 12-month
period and not designated as a credit against any other Sale/Leaseback
Transaction entered into by the Company or any Restricted Subsidiary of
the Company during such period.
Section 3.11 Limitation on Liens
The Company shall not, and shall not permit any Restricted Subsidiary of
the Company to, issue, assume or guarantee any Indebtedness for borrowed
money secured by any Lien on any property or asset now owned or hereafter
acquired by the Company or such Restricted Subsidiary without making
effective provision whereby any and all Securities then or thereafter
outstanding will be secured by a Lien equally and ratably with any and
all other obligations thereby secured for so long as any such obligations
shall be so secured. Notwithstanding the foregoing, the Company or any
Restricted Subsidiary of the Company may, without so securing the
Securities, issue, assume or guarantee Indebtedness for borrowed money
secured by the following Liens:
(a) Liens existing on the Issue Date or provided for under the terms of
agreements existing on the Issue Date;
(b) Liens on property securing (i) all or any portion of the cost of
acquiring, constructing, altering, improving or repairing any property or
assets, real or personal, or improvements used or to be used in
connection with such property or (ii) Indebtedness incurred by the
Company or any Restricted Subsidiary of the Company prior to or within
one year after the later of the acquisition, the completion of
construction, alteration, improvement or repair or the commencement of
commercial operation thereof, which Indebtedness is incurred for the
purpose of financing all or any part of the purchase price thereof or
construction or improvements thereon;
(c) Liens securing Indebtedness owed by a Restricted Subsidiary of the
Company to the Company or to any other Restricted Subsidiary of the
Company;
(d) Liens on property existing at the time of acquisition of such
property by the Company or any of its Restricted Subsidiaries or Liens on
the property of any Person existing at the time such Person becomes a
Restricted Subsidiary of the Company and, in any case, not incurred as a
result of (or in connection with or in anticipation of) the acquisition
of such Property or such Person becoming a Restricted Subsidiary of the
Company, provided that such Liens do not extend to or cover any property
or assets of the Company or any of its Restricted Subsidiaries other than
the property encumbered at the time such property is acquired by the
Company or any of its Restricted Subsidiaries or such Person becomes a
Restricted Subsidiary of the Company and, in any case, do not secure
Indebtedness with a principal amount in excess of the principal amount
outstanding at such time;
(e) Liens on any property securing (i) Indebtedness incurred in
connection with the construction, installation or financing of pollution
control or abatement facilities or other forms of industrial revenue bond
financing or (ii) Indebtedness issued or guaranteed by the United States
or any State thereof or any department, agency or instrumentality of
either;
(f) any Lien extending, renewing or replacing (or successive extensions,
renewals or replacements of) any Lien of any type permitted under clause
(a), (b), (d) or (e) above, provided that such Lien extends to or covers
only the property that is subject to the Lien being extended, renewed or
replaced and that the principal amount of the Indebtedness secured
thereby shall not exceed the principal amount of Indebtedness so secured
at the time of such extension, renewal or replacement; or
(g) Liens (exclusive of any Lien of any type otherwise permitted under
clauses (a) through (f) above) securing Indebtedness for borrowed money
of the Company or any Restricted Subsidiary of the Company in an
aggregate principal amount which, together with the aggregate amount of
Attributable Indebtedness deemed to be outstanding in respect of all
Sale/Leaseback Transactions entered into pursuant to clause (a) of
Section 3.09 hereof (exclusive of any such Sale/Leaseback Transactions
otherwise permitted under clauses (a) through (f) above), does not at the
time such Indebtedness is incurred exceed 15% of the Consolidated Net
Worth of the Company (as shown in the most recent audited consolidated
balance sheet of the Company and its Restricted Subsidiaries).
Section 3.12 Limitation on Restricted Payments
(a) The Company will not, and will not permit any Restricted Subsidiary,
directly or indirectly, to:
(1) declare or pay any dividend or make any distribution
on or in respect of its Capital Stock (including any
payment in connection with any merger or consolidation
involving the Company) or to the direct or indirect
holders of its Capital Stock, except:
(A) dividends or distributions payable solely in its
Non-Convertible Capital Stock or in options, warrants
or other rights to purchase its Non-Convertible
Capital Stock,
(B) dividends or distributions payable to the
Company or a Restricted Subsidiary, and
(C) pro rata dividends or distributions on the
Capital Stock of a Restricted Subsidiary held by
minority stockholders (including, without limitation,
minority stockholders of Arcade Drilling AS, a
Norwegian corporation);
(2) purchase, redeem or otherwise acquire or retire for
value any Capital Stock of the Company or of any direct or
indirect parent of the Company, or any Restricted
Subsidiary (except Capital Stock held by the Company or a
Restricted Subsidiary);
(3) purchase, repurchase, redeem, defease or otherwise
acquire or retire for value, prior to scheduled maturity,
scheduled repayment or scheduled sinking fund payment, any
Subordinated Obligations (other than the purchase,
repurchase or other acquisition of Subordinated
Obligations purchased in anticipation of satisfying a
sinking fund obligation, principal installment or final
maturity, in each case due within one year of the date of
acquisition); or
(4) make any Investment other than a Permitted Investment
(any such dividend, distribution, purchase, redemption,
repurchase, defeasance, other acquisition, retirement or
Investment being herein referred to as a "Restricted
Payment"),
if at the time the Company or such Restricted Subsidiary makes
such Restricted Payment:
(i) a Default shall have occurred and be continuing (or
would result therefrom); or
(ii) the Company would not be permitted to Incur an
additional $1.00 of Indebtedness pursuant to
Section 3.09(a) after giving pro forma effect to such
Restricted Payment; or
(iii) the aggregate amount of such Restricted Payment
and all other Restricted Payments since the Issue Date
would exceed the sum of:
(A) 50% of the Consolidated Net Income accrued
during the period (treated as one accounting period)
from the beginning of the fiscal quarter during which
the Securities were originally issued to the end of
the most recent fiscal quarter ending at least 45
days prior to the date of such Restricted Payment
(or, in case such Consolidated Net Income shall be a
deficit, minus 100% of such deficit);
(B) 100% of the aggregate net proceeds (including
the fair market value of non-cash proceeds, which
shall be determined in good faith by the Board of
Directors of the Company) received by the Company
from the issue or sale of its Capital Stock (other
than Redeemable Stock or Exchangeable Stock)
subsequent to the Issue Date (other than an issuance
or sale to a Restricted Subsidiary or an employee
stock ownership plan or similar trust);
(C) the amount by which Indebtedness of the Company
is reduced on the Company's balance sheet upon the
conversion or exchange (other than by a Restricted
Subsidiary) subsequent to the Incurrence of any
Indebtedness of the Company convertible or
exchangeable for Capital Stock (other than Redeemable
Stock or Exchangeable Stock) of the Company (less the
amount of any cash, or other property, distributed by
the Company upon such conversion or exchange);
(D) to the extent not otherwise included in
Consolidated Net Income, the net reduction in
Investments in Unrestricted Subsidiaries resulting
from dividends, repayments of loans or advances, or
other transfers of assets, in each case to the
Company or any Restricted Subsidiary after the Issue
Date from any Unrestricted Subsidiary or from the
redesignation of an Unrestricted Subsidiary as a
Restricted Subsidiary (valued in each case as
provided in the definition of Investment), not to
exceed in the case of any Restricted Subsidiary the
total amount of Investments (other than Permitted
Investments) in such Restricted Subsidiary made by
the Company and its Restricted Subsidiaries in such
Unrestricted Subsidiary after the Issue Date; and
(E) $20 million.
(b) The provisions of clause (a) of this Section shall not prohibit:
(1) any purchase or redemption of Capital Stock or
Subordinated Obligations of the Company made by exchange
for, or out of the proceeds of the substantially
concurrent sale of, Capital Stock of the Company (other
than Redeemable Stock or Exchangeable Stock and other than
Capital Stock issued or sold to a Restricted Subsidiary or
an employee stock ownership plan); provided, however, that
(i) such purchase or redemption shall be excluded in the
calculation of the amount of Restricted Payments and (ii)
the Net Cash Proceeds from such sale shall be excluded
from clauses (4)(iii)(B) and (4)(iii)(C) of Section (a);
(2) any purchase or redemption of Subordinated
Obligations of the Company made by exchange for, or out of
the proceeds of the substantially concurrent sale of,
Indebtedness of the Company which is permitted to be
Incurred pursuant to the provisions of Section 3.09;
provided, however, that such purchase or redemption shall
be excluded in the calculation of the amount of Restricted
Payments; and
(3) dividends paid within 60 days after the date of
declaration if at such date of declaration such dividend
would have complied with this provision; provided,
however, that at the time of payment of such dividend, no
other Default shall have occurred and be continuing (or
would result therefrom); provided further, however, that
such dividend shall be included in the calculation of the
amount of Restricted Payments.
Section 3.13 Covenant Termination
In the event that at any time (a) the ratings assigned to the Securities
by both of the Rating Agencies are Investment Grade Ratings and (b) no
Default has occurred and is continuing under this Indenture, the Company
and its Restricted Subsidiaries will no longer be subject to the
provisions of Sections 3.09 and 3.12 (together, the "Suspended
Covenants"). In the event that the Company is not subject to the
Suspended Covenants for any period of time as a result of the preceding
sentence and, subsequently, one or both Rating Agencies withdraws its
ratings or downgrades the ratings assigned to the Securities below the
required Investment Grade Ratings, then the Company and its Restricted
Subsidiaries will again be subject to the Suspended Covenants and
compliance with the Suspended Covenants with respect to Restricted
Payments made after the time of such withdrawal or downgrade will be
calculated in accordance with the provisions of Section 3.12 as if such
Section had been in effect during the entire period of time from the date
of this Indenture.
Section 3.14 Registration Rights Agreement
The Company shall perform its obligations under the Registration Rights
Agreement and shall comply in all material respects with the terms and
conditions contained therein including, without limitation, the payment
of any additional interest required by Section 6 of the Registration
Rights Agreement.
ARTICLE IV
SUCCESSORS
Section 4.01 Limitations on Mergers and Consolidations
Neither the Company nor any Guarantor (other than any Guarantor that has
been released from its Guarantee pursuant to the provisions of Section
9.06 hereof) shall consolidate with or merge into any Person, or sell,
lease, convey, transfer or otherwise dispose of all or substantially all
of its assets to any Person, unless:
(i) the Person formed by or surviving such consolidation
or merger (if other than the Company or such Guarantor, as
the case may be), or to which such sale, lease,
conveyance, transfer or other disposition shall be made
(collectively, the "Successor"), is a corporation
organized and existing under the laws of the United States
or any State thereof or the District of Columbia (or,
alternatively, in the case of a Guarantor organized under
the laws of a jurisdiction outside the United States, a
corporation organized and existing under the laws of such
foreign jurisdiction), and the Successor assumes by
supplemental indenture in a form satisfactory to the
Trustee all of the obligations of the Company or such
Guarantor, as the case may be, under this Indenture and
the Securities;
(ii) immediately after giving effect to such transaction,
no Default or Event of Default shall have occurred and be
continuing;
(iii) in the case of the Company, immediately after
giving effect to such transaction, the resulting,
surviving or transferee Person would be able to Incur at
least $1.00 of Indebtedness pursuant to Section 3.09(a);
and
(iv) the Company shall have delivered to the Trustee an
Officers' Certificate and an Opinion of Counsel, each
stating that the transaction and such supplemental
indenture comply with this Indenture.
Section 4.02 Successor Corporation Substituted
Upon any consolidation or merger of the Company or any Guarantor, or any
sale, lease, conveyance, transfer or other disposition of all or
substantially all of the assets of the Company or any Guarantor in
accordance with Section 4.01 hereof, the Successor formed by such
consolidation or into or with which the Company or such Guarantor is
merged or to which such sale, lease, conveyance, transfer or other
disposition or assignment is made shall succeed to, and be substituted
for, and may exercise every right and power of, the Company or such
Guarantor, as the case may be, under this Indenture and the Securities
with the same effect as if such Successor had been named as the Company
or such Guarantor herein and the predecessor Company or Guarantor, in the
case of a sale, conveyance, transfer or other disposition, shall be
released from all obligations under this Indenture and the Securities.
ARTICLE V
DEFAULTS AND REMEDIES
Section 5.01 Events of Default
An "Event of Default" with respect to any series of Securities occurs if:
(1) the Company or any Guarantor defaults in the payment
of interest on any Security of such series when the same
becomes due and payable and such default continues for a
period of 30 days;
(2) the Company or any Guarantor defaults in the payment
of the principal of or premium, if any, on any Security of
such series when the same becomes due and payable at
maturity, upon acceleration, upon redemption or otherwise;
(3) the Company or any Guarantor fails to comply with any
of its other agreements or covenants in, or provisions of,
the Securities of such series, any Guarantees or this
Indenture and such failure continues for the period and
after the notice specified in the last paragraph of this
Section 5.01;
(4) any default shall occur which results in the
acceleration of the maturity of any Indebtedness of the
Company or any Restricted Subsidiary of the Company (other
than the Securities of such series or any Non-Recourse
Indebtedness) having an outstanding principal amount of
$20 million or more individually or, taken together with
all other such Indebtedness that has been so accelerated,
in the aggregate; or any default shall occur in the
payment of any principal or interest in respect of any
Indebtedness of the Company or any Restricted Subsidiary
of the Company (other than the Securities of such series
or any Non-Recourse Indebtedness) having an outstanding
principal amount of $20 million or more individually or,
taken together with all other such Indebtedness with
respect to which any such payment has not been made, in
the aggregate and such default shall be continuing for a
period of 30 days without the Company or such Restricted
Subsidiary, as the case may be, effecting a cure of such
default;
(5) a final judgment or order for the payment of money in
excess of $20 million (net of applicable insurance
coverage) shall be rendered against the Company, any
Guarantor or any other "significant subsidiary" (as such
term is defined in Regulation S-X under the Exchange Act,
a "Significant Subsidiary") of the Company that is a
Restricted Subsidiary and such judgment or order shall
continue unsatisfied and unstayed for a period of 60 days;
(6) the Company, any Guarantor or any other Significant
Subsidiary of the Company that is a Restricted Subsidiary
pursuant to or within the meaning of any Bankruptcy Law:
(A) commences a voluntary case,
(B) consents to the entry of an order for relief
against it in an involuntary case,
(C) consents to the appointment of a Custodian of it
or for all or for a substantial part of its property,
or
(D) makes a general assignment for the benefit of
its creditors; or
(7) a court of competent jurisdiction enters an order or
decree under any Bankruptcy Law that remains unstayed and
in effect for 60 days and that:
(A) is for relief against the Company, any Guarantor
or any other Significant Subsidiary of the Company
that is a Restricted Subsidiary as debtor in an
involuntary case,
(B) appoints a Custodian of the Company, any
Guarantor or any other Significant Subsidiary of the
Company that is a Restricted Subsidiary or a
Custodian for all or for a substantial part of the
property of the Company, any Guarantor or any other
Significant Subsidiary of the Company that is a
Restricted Subsidiary, or
(C) orders the liquidation of the Company, any
Guarantor or any other Significant Subsidiary of the
Company that is a Restricted Subsidiary.
The term "Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
The Trustee shall not be deemed to know of a Default or Event of Default
unless a Trust Officer at the Corporate Trust Office of the Trustee has
actual knowledge of such Default or the Trustee receives written notice
at the Corporate Trust Office of the Trustee of such Default or Event of
Default with specific reference to such Default.
When a Default is cured, it ceases.
A Default under clause (3) of this Section is not an Event of Default
until the Trustee notifies the Company and, in the case of a Default by a
Guarantor, such Guarantor, or the Holders of at least 25% in principal
amount of the Securities of any series then outstanding notify the
Company, such Guarantor (where applicable) and the Trustee, of the
Default, and neither the Company nor such Guarantor cures the Default
within 60 days after receipt of the notice. The notice must specify the
Default, demand that it be remedied and state that the notice is a
"Notice of Default."
Section 5.02 Acceleration
If an Event of Default (other than an Event of Default specified in
clause (6) or (7) of Section 5.01 hereof with respect to the Company or
any Guarantor) with respect to any series of Securities occurs and is
continuing, the Trustee by notice to the Company, or the Holders of at
least 25% in principal amount of the then outstanding Securities of such
series by notice to the Company and the Trustee, may declare the
principal of and premium, if any, and accrued and unpaid interest on all
then outstanding Securities of such series to be due and payable
immediately. Upon any such declaration the amounts due and payable on
the Securities of such series, as determined in accordance with the next
succeeding paragraph, shall be due and payable immediately. If an Event
of Default specified in clause (6) or (7) of Section 5.01 hereof with
respect to the Company or any Guarantor occurs, the principal of and
premium, if any, and accrued and unpaid interest on all Securities then
outstanding shall ipso facto become and be immediately due and payable
without any declaration, notice or other act on the part of the Trustee
or any Holder. The Holders of a majority in principal amount of the
Securities of any series then outstanding by written notice to the
Trustee may rescind an acceleration and its consequences with respect to
such series (other than nonpayment of principal of, or premium, if any,
or interest on the Securities of such series) if the rescission would not
conflict with any judgment or decree and if all existing Events of
Default have been cured or waived, except nonpayment of principal, or
premium, if any, or interest that has become due solely because of the
acceleration.
In the event that the maturity of the Securities of any series is
accelerated pursuant to this Section 5.02, 100% of the principal amount
thereof shall become due and payable plus, premium, if any, and accrued
interest to the date of payment.
Section 5.03 Other Remedies
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal of, or premium,
if any, or interest on the Securities or to enforce the performance of
any provision of the Securities, this Indenture or the Registration
Rights Agreement.
The Trustee may maintain a proceeding even if it does not possess any of
the Securities or does not produce any of them in the proceeding. A
delay or omission by the Trustee or any Holder in exercising any right or
remedy accruing upon an Event of Default shall not impair the right or
remedy or constitute a waiver of or acquiescence in the Event of Default.
All remedies are cumulative to the extent permitted by law.
Section 5.04 Waiver of Existing Defaults
Subject to Sections 5.07 and 8.02 hereof, the Holders of a majority in
principal amount of the Securities of any series then outstanding by
notice to the Trustee may waive an existing Default or Event of Default
and its consequences (including waivers obtained in connection with a
tender offer or exchange offer for the Securities of such series or a
solicitation of consents in respect of the Securities of such series,
provided that in each case such offer or solicitation is made to all
Holders of the Securities of such series then outstanding on equal
terms), except (1) a continuing Default or Event of Default in the
payment of the principal of, or premium, if any, or interest on the
Securities of any series or (2) a continuing Default in respect of a
provision that under Section 8.02 hereof cannot be amended without the
consent of each Holder affected. Upon any such waiver, such Default
shall cease to exist, and any Event of Default arising therefrom shall be
deemed to have been cured for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or impair any
right consequent thereon.
Section 5.05 Control by Majority
The Holders of a majority in principal amount of the Securities of any
series then outstanding may direct the time, method and place of
conducting any proceeding for any remedy available to the Trustee or
exercising any trust or power conferred on it hereunder with respect to
such series. However, the Trustee may refuse to follow any direction
that conflicts with applicable law or this Indenture, that the Trustee
determines may be unduly prejudicial to the rights of other Holders, or
that may involve the Trustee in personal liability; provided, however,
that the Trustee may take any other action deemed proper by the Trustee
that is not inconsistent with such direction. Prior to taking any action
hereunder, the Trustee shall be entitled to indemnification satisfactory
to it in its sole discretion against all losses and expenses caused by
taking or not taking such action.
Section 5.06 Limitations on Suits
Subject to Section 5.07 hereof, a Holder may pursue a remedy with respect
to this Indenture (including the Guarantees) or the Securities of any
series only if:
(1) the Holder gives to the Trustee written notice of a
continuing Event of Default;
(2) the Holders of at least 25% in principal amount of
the Securities of such series then outstanding make a
written request to the Trustee to pursue the remedy;
(3) such Holder or Holders offer to the Trustee indemnity
reasonably satisfactory to the Trustee against any loss,
liability or expense;
(4) the Trustee does not comply with the request within
60 days after receipt of the request and the offer of
indemnity; and
(5) during such 60-day period the Holders of a majority
in principal amount of the Securities of such series do
not give the Trustee a direction inconsistent with the
request.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over another Holder.
Section 5.07 Rights of Holders to Receive Payment
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Security to receive payment of principal of, and premium, if
any, and interest on the Security, on or after the respective due dates
expressed in the Security, or to bring suit for the enforcement of any
such payment on or after such respective dates, is absolute and
unconditional and shall not be impaired or affected without the consent
of the Holder.
Section 5.08 Collection Suit by Trustee
If an Event of Default specified in clause (1) or (2) of Section 5.01
hereof occurs and is continuing, the Trustee is authorized to recover
judgment in its own name and as trustee of an express trust against the
Company and any Guarantor for the amount of principal and premium, if
any, and interest remaining unpaid on any series of Securities, and
interest on overdue principal and premium, if any, and, to the extent
lawful, interest on overdue interest, and such further amount as shall be
sufficient to cover the costs and expenses of collection, including the
reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
Section 5.09 Trustee May File Proofs of Claim
The Trustee is authorized to file such proofs of claim and other papers
or documents and to take such actions, including participating as a
member, voting or otherwise, of any committee of creditors, as may be
necessary or advisable in order to have the claims of the Trustee
(including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and
the Holders allowed in any judicial proceedings relative to the Company
and any Guarantor or their respective creditors or properties and shall
be entitled and empowered to collect, receive and distribute any money or
other property payable or deliverable on any such claims and any
Custodian in any such judicial proceeding is hereby authorized by each
Holder to make such payments to the Trustee, and in the event that the
Trustee shall consent to the making of such payments directly to the
Holders, to pay to the Trustee any amount due to it for the reasonable
compensation, expenses, disbursements and advances of the Trustee, its
agents and counsel, and any other amounts due the Trustee under Section
6.07 hereof. To the extent that the payment of any such compensation,
expenses, disbursements and advances of the Trustee, its agents and
counsel, and any other amounts due the Trustee under Section 6.07 hereof
out of the estate in any such proceeding, shall be denied for any reason,
payment of the same shall be secured by a Lien on, and shall be paid out
of, any and all distributions, dividends, money, securities and other
properties which the Holders of the Securities of any series may be
entitled to receive in such proceeding whether in liquidation or under
any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the
Securities of any series or the rights of any Holder thereof, or to
authorize the Trustee to vote in respect of the claim of any Holder in
any such proceeding.
Section 5.10 Priorities
If the Trustee collects any money pursuant to this Article, it shall pay
out the money in the following order:
First: to the Trustee for amounts due under Section 6.07 hereof;
Second: to Holders for amounts due and unpaid on the Securities for
principal, premium, if any, and interest ratably, without preference
or priority of any kind, according to the amounts due and payable on
the Securities for principal, premium, if any, and interest,
respectively; and
Third: to the Company.
The Trustee, upon prior written notice to the Company, may fix a record
date and payment date for any payment to Holders pursuant to this
Article.
Section 5.11 Undertaking for Costs
In any suit for the enforcement of any right or remedy under this
Indenture or in any suit against the Trustee for any action taken or
omitted by it as a trustee, a court in its discretion may require the
filing by any party litigant in the suit of an undertaking to pay the
costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees, against any party litigant
in the suit, having due regard to the merits and good faith of the claims
or defenses made by the party litigant. This Section does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 5.07 hereof,
or a suit by a Holder or Holders of more than 10% in principal amount of
the Securities of any series then outstanding.
ARTICLE VI
TRUSTEE
Section 6.01 Duties of Trustee
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this
Indenture, and use the same degree of care and skill in such exercise, as
a prudent man would exercise or use under the circumstances in the
conduct of his own affairs.
(b) Except during the continuance of an Event of Default:
(1) the Trustee need perform only those duties that are
specifically set forth in this Indenture and no others, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(2) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements
of this Indenture. However, the Trustee shall examine such
certificates and opinions to determine whether or not, on their
face, they appear to conform to the requirements of this Indenture.
(c) The Trustee may not be relieved from liabilities for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(1) this paragraph does not limit the effect of paragraph (b) of
this Section;
(2) the Trustee shall not be liable for any error of judgment made
in good faith by a Trust Officer, unless it is proved that the
Trustee was negligent in ascertaining the pertinent facts; and
(3) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 5.05 hereof.
(d) Whether or not therein expressly so provided, every provision of
this Indenture that in any way relates to the Trustee is subject to
paragraphs (a), (b) and (c) of this Section.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee may refuse to
perform any duty or exercise any right or power unless it receives
indemnity reasonably satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not be liable for interest on any money received
by it except as the Trustee may agree in writing with the Company. Money
held in trust by the Trustee need not be segregated from other funds
except to the extent required by law. All money received by the Trustee
shall, until applied as herein provided, be held in trust for the payment
of the principal of, and premium if any, and interest on the Securities.
Section 6.02 Rights of Trustee
(a) The Trustee may rely on any document believed by it to be genuine
and to have been signed or presented by the proper Person. The Trustee
need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee
shall not be liable for any action it takes or omits to take in good
faith in reliance on such Officers' Certificate or Opinion of Counsel.
The Trustee may consult with counsel and the written advice of such
counsel or any Opinion of Counsel shall be full and complete
authorization and protection in respect of any action taken, suffered or
omitted by it hereunder in good faith and in reliance thereon.
(c) The Trustee may act through agents and shall not be responsible for
the misconduct or negligence of any agent appointed with due care.
(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith which it believes to be authorized or within its
rights or powers conferred upon it by this Indenture.
(e) Unless otherwise specifically provided in this Indenture, any
demand, request, direction or notice from the Company or any Guarantor
shall be sufficient if signed by an Officer of the Company or such
Guarantor.
(f) The Trustee is not required to give any bond or surety with respect
to the performance of its duties or the exercise of its powers under this
Indenture.
(g) In the event the Trustee receives inconsistent or conflicting
requests and indemnity from two or more groups of holders of Securities
of a series, each representing less than a majority in aggregate
principal amount of the Securities outstanding of such series, pursuant
to the provisions of this Indenture, the Trustee, in its sole discretion,
may determine what action, if any, shall be taken.
(h) The Trustee's immunities and protections from liability and its
right to indemnification in connection with the performance of its duties
under this Indenture shall extend to the Trustee's officers, directors,
agents, attorneys and employees. Such immunities and protections and
right to indemnity, together with the Trustee's right to compensation,
shall survive the Trustee's resignation or removal, the discharge of this
Indenture and final payment of the Securities.
(i) The permissive right of the Trustee to take the actions permitted by
the Indenture shall not be construed as an obligation or duty to do so.
(j) Except for information provided by the Trustee concerning the
Trustee, the Trustee shall have no responsibility for any information in
any offering memorandum or other disclosure material distributed with
respect to the Securities, and the Trustee shall have no responsibility
for compliance with any state or federal securities laws in connection
with the Securities.
Section 6.03 Individual Rights of Trustee
The Trustee in its individual or any other capacity may become the owner
or pledgee of Securities and may otherwise deal with the Company, the
Guarantors or any of their Affiliates with the same rights it would have
if it were not Trustee. Any Agent may do the same with like rights.
However, the Trustee is subject to Sections 6.10 and 6.11 hereof.
Section 6.04 Trustee's Disclaimer
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities, it shall not be accountable for the
Company's use of the proceeds from the Securities or any money paid to
the Company or upon the Company's direction under any provision hereof,
it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee and it shall not be
responsible for any statement or recital herein or any statement in the
Securities other than its certificate of authentication.
Section 6.05 Notice of Defaults
If a Default or Event of Default occurs and is continuing and it is known
to the Trustee, the Trustee shall mail to Holders a notice of the Default
or Event of Default within 90 days after it occurs. Except in the case
of a Default or Event of Default in payment of principal of, or premium,
if any, or interest on any Security, the Trustee may withhold the notice
if and so long as a committee of its Trust Officers in good faith
determines that withholding the notice is in the interests of Holders.
Section 6.06 Reports by Trustee to Holders
As promptly as practicable after each [May 15, beginning with May 15,
1999], the Trustee shall mail to Holders a brief report dated as of such
reporting date that complies with TIA Section 313(a); provided, however,
that if no event described in TIA Section 313(a) has occurred within the
twelve months preceding the reporting date, no report need be
transmitted. The Trustee also shall comply with TIA Section 313(b). The
Trustee shall also transmit by mail all reports as required by TIA
Sections 313(c) and 313(d).
A copy of each report at the time of its mailing to Holders shall be
filed with the SEC and each securities exchange, if any, on which the
Securities are listed. The Company shall notify the Trustee if and when
the Securities are listed on any stock exchange.
Section 6.07 Compensation and Indemnity
The Company and the Guarantors jointly and severally agree to pay to the
Trustee from time to time reasonable compensation for its acceptance of
this Indenture and services hereunder. The Trustee's compensation shall
not be limited by any law on compensation of a trustee of an express
trust. The Company and the Guarantors jointly and severally agree to
reimburse the Trustee upon request for all reasonable disbursements,
advances and expenses incurred by it. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Company and the Guarantors jointly and severally agree to indemnify
the Trustee against any loss, liability or expense incurred by it arising
out of or in connection with the acceptance or administration of its
duties under this Indenture, except as set forth in the next paragraph.
The Trustee shall notify the Company and the Guarantors promptly of any
claim for which it may seek indemnity. The Company shall defend the
claim and the Trustee shall cooperate in the defense. The Trustee may
have separate counsel and the Company and the Guarantors shall pay the
reasonable fees and expenses of such counsel. The Company need not pay
for any settlement made without its consent.
Neither the Company nor the Guarantors shall be obligated to reimburse
any expense or indemnify against any loss or liability incurred by the
Trustee through negligence or bad faith.
To secure the payment obligations of the Company and the Guarantors in
this Section 6.07, the Trustee shall have a Lien prior to the Securities
on all money or property held or collected by the Trustee, except that
held in trust to pay principal of, and premium, if any, and interest on
the Securities. Such Lien shall survive the satisfaction and discharge
of this Indenture.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 5.01(6) or (7) hereof occurs, the expenses
and the compensation for the services are intended to constitute expenses
of administration under any Bankruptcy Law.
Section 6.08 Replacement of Trustee
A resignation or removal of the Trustee and appointment of a successor
Trustee shall become effective only upon the successor Trustee's
acceptance of appointment as provided in this Section 6.08.
The Trustee may resign and be discharged from the trust hereby created by
so notifying the Company and the Guarantors. The Holders of a majority
in principal amount of the then outstanding Securities may remove the
Trustee by so notifying the Trustee and the Company. The Company may
remove the Trustee if:
(1) the Trustee fails to comply with Section 6.10 hereof;
(2) the Trustee is adjudged a bankrupt or an insolvent or an order
for relief is entered with respect to the Trustee under any
Bankruptcy Law;
(3) a Custodian or public officer takes charge of the Trustee or
its property; or
(4) the Trustee otherwise becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Company and the Guarantors shall promptly
appoint a successor Trustee. Within one year after the successor Trustee
takes office, the Holders of a majority in principal amount of the
Securities then outstanding may appoint a successor Trustee to replace
the successor Trustee appointed by the Company.
If a successor Trustee does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Company
or the Holders of at least 10% in principal amount of the Securities then
outstanding may petition any court of competent jurisdiction for the
appointment of a successor Trustee.
If the Trustee fails to comply with Section 6.10 hereof, any Holder may
petition any court of competent jurisdiction for the removal of the
Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Company and the Guarantors. Thereupon
the resignation or removal of the retiring Trustee shall become
effective, and the successor Trustee shall have all the rights, powers
and duties of the Trustee under this Indenture. The successor Trustee
shall mail a notice of its succession to Holders. The retiring Trustee
shall promptly transfer all property held by it as Trustee to the
successor Trustee, subject to the Lien provided for in Section 6.07
hereof. Notwithstanding replacement of the Trustee pursuant to this
Section 6.08 hereof, the obligations of the Company and the Guarantors
under Section 6.07 hereof shall continue for the benefit of the retiring
Trustee.
Section 6.09 Successor Trustee by Merger, etc
Subject to Section 6.10 hereof, if the Trustee consolidates, merges or
converts into, or transfers all or substantially all of its corporate
trust business to, another corporation, the successor corporation without
any further act shall be the successor Trustee; provided, however, that
in the case of a transfer of all or substantially all of its corporate
trust business to another corporation, the transferee corporation
expressly assumes all of the Trustee's liabilities hereunder.
In case any Securities shall have been authenticated, but not delivered,
by the Trustee then in office, any successor by merger, conversion or
consolidation to such authenticating Trustee may adopt such
authentication and deliver the Securities so authenticated; and in case
at that time any of the Securities shall not have been authenticated, any
successor to the Trustee may authenticate such Securities either in the
name of any predecessor hereunder or in the name of the successor to the
Trustee; and in all such cases such certificates shall have the full
force which it is anywhere in the Securities or in this Indenture
provided that the certificate of the Trustee shall have.
Section 6.10 Eligibility; Disqualification
There shall at all times be a Trustee hereunder which shall be a
corporation organized and doing business under the laws of the United
States of America, any State thereof or the District of Columbia and
authorized under such laws to exercise corporate trust power, shall be
subject to supervision or examination by Federal or State (or the
District of Columbia) authority and shall have, or be a Subsidiary of a
bank or bank holding company having, a combined capital and surplus of at
least $50 million as set forth in its most recent published annual report
of condition.
The Indenture shall always have a Trustee who satisfies the requirements
of TIA Sections 310(a)(1), 310(a)(2) and 310(a)(5). The Trustee is
subject to and shall comply with the provisions of TIA Section 310(b)
during the period of time required by this Indenture. Nothing in this
Indenture shall prevent the Trustee from filing with the SEC the
application referred to in the penultimate paragraph of TIA Section
310(b).
Section 6.11 Preferential Collection of Claims Against Company
The Trustee is subject to and shall comply with the provisions of TIA
Section 311(a), excluding any creditor relationship listed in TIA Section
311(b). A Trustee who has resigned or been removed shall be subject to
TIA Section 311(a) to the extent indicated therein.
ARTICLE VII
DISCHARGE OF INDENTURE
Section 7.01 Termination of Company's Obligations
(a) This Indenture shall cease to be of further effect with respect to
Securities of a series (except that the Company's and any Guarantors'
obligations under Section 6.07 hereof and the Trustee's and Paying
Agent's obligations under Section 7.03 hereof shall survive), and the
Trustee, on demand of the Company, shall execute proper instruments
acknowledging the satisfaction and discharge of this Indenture with
respect to such series, when:
(1) either
(A) all outstanding Securities of such series theretofore
authenticated and issued (other than destroyed, lost or stolen
Securities that have been replaced or paid) have been delivered
to the Trustee for cancellation; or
(B) all outstanding Securities of such series not theretofore
delivered to the Trustee for cancellation:
(i) have become due and payable, or
(ii) will become due and payable at their stated maturity within one
year,
and the Company, in the case of clause (i) or (ii) above, has
deposited or caused to be deposited with the Trustee as funds
(immediately available to the Holders in the case of clause (i)) in
trust for such purpose an amount which, together with earnings
thereon, will be sufficient to pay and discharge the entire
indebtedness on such Securities of such series for principal,
premium, if any, and interest to the date of such deposit (in the
case of Securities which have become due and payable) or to the
stated maturity, as the case may be;
(1) the Company has paid all other sums payable by it hereunder
with respect to such series; and
(2) the Company has delivered to the Trustee an Officers'
Certificate stating that all conditions precedent to satisfaction
and discharge of this Indenture with respect to such series have
been complied with, together with an Opinion of Counsel to the same
effect.
(b) The Company and the Guarantors may, subject as provided herein,
terminate all of their obligations under this Indenture with respect to
Securities of a series if:
(1) the Company has irrevocably deposited or caused to be
irrevocably deposited with the Trustee as trust funds in trust for
the purpose of making the following payments dedicated solely to the
benefit of the Holders (i) cash in an amount, or (ii) U.S.
Government Obligations or (iii) a combination thereof, sufficient,
in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered
to the Trustee, to pay, without consideration of the reinvestment of
any such amounts and after payment of all taxes or other charges or
assessments in respect thereof payable by the Trustee, the principal
of, and premium, if any, and interest on all Securities of such
series on each date that such principal, premium, if any, or
interest is due and payable and to pay all other sums payable by it
hereunder; provided that the Trustee shall have been irrevocably
instructed to apply such money and/or the proceeds of such U.S.
Government Obligations to the payment of said principal, premium, if
any, and interest with respect to the Securities of such series as
the same shall become due;
(2) the Company has delivered to the Trustee an Officers'
Certificate stating that all conditions precedent to satisfaction
and discharge of this Indenture with respect to Securities of such
series have been complied with, and an Opinion of Counsel to the
same effect;
(3) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit or, insofar as clauses (6)
and (7) of Section 5.01 hereof are concerned, at any time during the
period ending on the 91st day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied
until the expiration of such period);
(4) the Company shall have delivered to the Trustee an Opinion of
Counsel from a nationally recognized counsel acceptable to the
Trustee or a tax ruling to the effect that the Holders of Securities
of such series will not recognize income, gain or loss for Federal
income tax purposes as a result of the Company's exercise of its
option under this Section 7.01(b) and will be subject to Federal
income tax on the same amount and in the same manner and at the same
times as would have been the case if such option had not been
exercised;
(5) such deposit and discharge will not result in a breach or
violation of, or constitute a default under, any other agreement or
instrument to which the Company is a party or by which it is bound;
(6) such deposit and discharge shall not cause the Trustee to have
a conflicting interest as defined in TIA Section 310(b); and
(7) the Company shall have delivered to the Trustee an Opinion of
Counsel to the effect that after the passage of 91 days following
the deposit, the trust funds will not be subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar
laws affecting creditors' rights generally.
In such event, this Indenture shall cease to be of further effect with
respect to Securities of such series (except as provided in the next
succeeding paragraph), and the Trustee, on demand of the Company, shall
execute proper instruments acknowledging satisfaction and discharge under
this Indenture.
However, the Company's obligations in Sections 2.03, 2.04, 2.05, 2.06,
2.07, 2.08, 3.01, 4.01, 6.07, 6.08 and 7.04 hereof, the Company's and any
Guarantors' obligations in Sections 4.01, 6.07, 7.04 and 9.01 hereof and
the Trustee's and Paying Agent's obligations in Section 7.03 hereof shall
survive until the Securities of such series are no longer outstanding.
Thereafter, only the Company's and any Guarantors' obligations in Section
6.07 hereof and the Trustee's and Paying Agent's obligations in Section
7.03 hereof shall survive.
After such irrevocable deposit made pursuant to this Section 7.01(b) and
satisfaction of the other conditions set forth herein, the Trustee upon
request shall acknowledge in writing the discharge of the Company's
obligations under this Indenture except for those surviving obligations
specified above.
In order to have money available on a payment date to pay principal of,
or premium, if any, or interest on the Securities of such series, the
U.S. Government Obligations shall be payable as to principal or interest
on or before such payment date in such amounts as will provide the
necessary money. U.S. Government Obligations shall not be callable at
the issuer's option.
Section 7.02 Application of Trust Money
The Trustee or a trustee satisfactory to the Trustee and the Company
shall hold in trust money or U.S. Government Obligations deposited with
it pursuant to Section 7.01 hereof. It shall apply the deposited money
and the money from U.S. Government Obligations through the Paying Agent
and in accordance with this Indenture to the payment of principal of, and
premium, if any, and interest on Securities of the series with respect to
which the deposit was made.
Section 7.03 Repayment to Company
The Trustee and the Paying Agent shall promptly pay to the Company upon
written request any excess money or securities held by them at any time.
Subject to the requirements of any applicable abandoned property laws,
the Trustee and the Paying Agent shall pay to the Company upon written
request any money held by them for the payment of principal, or premium,
if any, or interest that remains unclaimed for two years after the date
upon which such payment shall have become due; provided, however, that
the Company shall have either caused notice of such payment to be mailed
to each Holder entitled thereto no less than 30 days prior to such
repayment or within such period shall have published such notice in a
financial newspaper of widespread circulation published in The City of
New York. After payment to the Company, Holders entitled to the money
must look to the Company for payment as general creditors unless an
applicable abandoned property law designates another Person, and all
liability of the Trustee and the Paying Agent with respect to such money
shall cease.
Section 7.04 Reinstatement
If the Trustee or the Paying Agent is unable to apply any money or U. S.
Government Obligations in accordance with Section 7.01 hereof by reason
of any legal proceeding or by reason of any order or judgment of any
court or governmental authority enjoining, restraining or otherwise
prohibiting such application, the obligations of the Company and any
Guarantors under this Indenture and the Securities of the applicable
series shall be revived and reinstated as though no deposit had occurred
pursuant to Section 7.01 hereof until such time as the Trustee or the
Paying Agent is permitted to apply all such money or U. S. Government
Obligations in accordance with Section 7.01 hereof; provided, however,
that if the Company or any Guarantor has made any payment of principal of
or interest on any Securities of such series because of the reinstatement
of its obligations, the Company or such Guarantor shall be subrogated to
the rights of the Holders of such Securities to receive such payment from
the money or U.S. Government Obligations held by the Trustee or the
Paying Agent.
ARTICLE VIII
AMENDMENTS
Section 8.01 Without Consent of Holders
The Company, the Guarantors, if any, and the Trustee may amend or
supplement this Indenture or any of the Securities or waive any provision
hereof or thereof without the consent of any Holder:
(1) to cure any ambiguity, omission, defect or inconsistency;
(2) to comply with Sections 4.01 and 4.02 hereof;
(3) to provide for uncertificated Securities in addition to or in
place of certificated Securities;
(4) to reflect the release of any Guarantor from its Guarantee, or
the addition of any Subsidiary of the Company as a Guarantor, in the
manner provided by Section 9.06 hereof;
(5) to comply with any requirement in order to effect or maintain
the qualification of this Indenture under the TIA;
(6) to add guarantees of the Securities;
(7) to comply with any requirements of the SEC in connection with
qualifying this Indenture under the TIA;
(8) to add to the covenants of the Company or any Guarantor for the
benefit of the Holders or to surrender any right or power herein
conferred upon the Company or any Guarantor; or
(9) to make any change that does not adversely affect the rights
hereunder of any Holder in any material respect.
Upon the request of the Company and the Guarantors, if any, accompanied
by a resolution of the Board of Directors and of the board of directors,
board of trustees or managing partners of each Guarantor authorizing the
execution of any such supplemental indenture, and upon receipt by the
Trustee of the documents described in Section 8.06 hereof, the Trustee
shall join with the Company and any Guarantors in the execution of any
supplemental indenture authorized or permitted by the terms of this
Indenture and make any further appropriate agreements and stipulations
that may be therein contained. After an amendment, supplement or waiver
under this Section 8.01 becomes effective, the Company shall mail to the
Holders of each Security affected thereby a notice briefly describing the
amendment, supplement or waiver. Any failure of the Company to mail such
notice, or any defect therein, shall not, however, in any way impair or
affect the validity of any such supplemental indenture.
Section 8.02 With Consent of Holders
Except as provided below in this Section 8.02, the Company, the
Guarantors and the Trustee may amend or supplement this Indenture with
respect to the Securities of a series or the Securities of any series
with the written consent (including consents obtained in connection with
a tender offer or exchange offer for the Securities of such series or a
solicitation of consents in respect of the Securities of such series,
provided that in each case such offer or solicitation is made to all
Holders of the Securities of such series then outstanding on equal terms)
of the Holders of at least a majority in principal amount of the
Securities of such series then outstanding.
Upon the request of the Company and the Guarantors, if any, accompanied
by a resolution of the Board of Directors and of the board of directors,
board of trustees or managing partners of each Guarantor, if any,
authorizing the execution of any such supplemental indenture, and upon
the filing with the Trustee of evidence of the consent of the Holders as
aforesaid, and upon receipt by the Trustee of the documents described in
Section 8.06 hereof, the Trustee shall join with the Company and the
Guarantors, if any, in the execution of such supplemental indenture.
It shall not be necessary for the consent of the Holders under this
Section 8.02 to approve the particular form of any proposed amendment,
supplement or waiver, but it shall be sufficient if such consent approves
the substance thereof.
The Holders of a majority in principal amount of the Securities of any
series then outstanding may waive compliance in a particular instance by
the Company or the Guarantors with any provision of this Indenture or the
Securities of such series (including waivers obtained in connection with
a tender offer or exchange offer for the Securities of such series or a
solicitation of consents in respect of the Securities of such series,
provided that in each case such offer or solicitation is made to all
Holders of the Securities of such series then outstanding on equal
terms).
However, without the consent of each Holder affected, an amendment,
supplement or waiver under this Section may not:
(1) reduce the amount of the Securities of any series whose Holders
must consent to an amendment, supplement or waiver;
(2) reduce the rate of or change the time for payment of interest,
including default interest, on any Security;
(3) reduce the principal of or change the fixed maturity of any
Security or alter the premium or other provisions with respect to
redemption under Section 10.07 or specified in the Securities;
(4) make any Security payable in money other than that stated in
the Security;
(5) impair the right to institute suit for the enforcement of any
payment of principal of, or premium, if any, or interest on any
Security pursuant to Sections 5.07 and 5.08 hereof, except as
limited by Section 5.06 hereof;
(6) make any change in the percentage of principal amount of the
Securities of any series necessary to waive compliance with certain
provisions of this Indenture pursuant to Section 5.04 or 5.07 hereof
or this clause of this Section 8.02; or
(7) waive a continuing Default or Event of Default in the payment
of principal of, or premium, if any, or interest on the Securities
of any series.
The right of any Holder to participate in any consent required or sought
pursuant to any provision of this Indenture (and the obligation of the
Company to obtain any such consent otherwise required from such Holder)
may be subject to the requirement that such Holder shall have been the
Holder of record of the Securities with respect to which such consent is
required or sought as of a date identified by the Trustee in a notice
furnished to Holders in accordance with the terms of this Indenture.
Section 8.03 Compliance with Trust Indenture Act
Every amendment to this Indenture or the Securities of any series shall
comply in form and substance with the TIA as then in effect.
Section 8.04 Revocation and Effect of Consents
A consent to an amendment (which includes a supplement) or waiver by a
Holder is a continuing consent by the Holder and every subsequent Holder
of a Security of any series or portion of a Security of such series that
evidences the same debt as the consenting Holder's Security, even if
notation of the consent is not made on any Security. However, any such
Holder or subsequent Holder may revoke the consent as to his or her
Security or portion of a Security if the Trustee receives written notice
of revocation at any time pror to (but not after) the date the Trustee
receives an Officers' Certificate certifying that the Holders of the
requisite principal amount of Securities have consented (and not
theretofore revoked such consent) to the amendment, supplement or waiver.
An amendment, supplement or waiver becomes effective in accordance with
its terms and thereafter binds every Holder.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment
or waiver or to take any other action with respect to the Securities of
any series under this Indenture. If a record date is fixed, then
notwithstanding the provisions of the immediately preceding paragraph,
those Persons who were Holders at such record date (or their duly
designated proxies), and only those Persons, shall be entitled to consent
to such amendment, supplement or waiver or to revoke any consent
previously given, whether or not such Persons continue to be Holders
after such record date. No consent shall be valid or effective for more
than 90 days after such record date unless consents from Holders of the
principal amount of the Securities of such series required hereunder for
such amendment or waiver to be effective shall have also been given and
not revoked within such 90-day period.
After an amendment, supplement or waiver becomes effective, it shall bind
every Holder, unless it is of the type described in any of clauses (1)
through (7) of Section 8.02 hereof. In such case, the amendment or
waiver shall bind each Holder who has consented to it and every
subsequent Holder that evidences the same debt as the consenting Holder's
Security.
Section 8.05 Notation on or Exchange of Securities
If an amendment changes the terms of a Security, the Trustee may require
the Holder of the Security to deliver it to the Trustee. The Trustee may
place an appropriate notation on the Security regarding the changed terms
and return it to the Holder. Alternatively, if the Company or the
Trustee so determines, the Company in exchange for the Security shall
issue and the Trustee shall authenticate a new Security that reflects the
changed terms. Failure to make the appropriate notation or to issue a new
Security shall not affect the validity of such amendment.
Section 8.06 Trustee to Sign Amendments, etc
The Trustee shall sign any amendment, waiver or supplemental indenture
authorized pursuant to this Article if the amendment, waiver or
supplemental indenture does not adversely affect the rights, duties,
liabilities or immunities of the Trustee. If it does, the Trustee may,
but need not, sign it. In signing or refusing to sign such amendment,
waiver or supplemental indenture, the Trustee shall be entitled to
receive and subject to Section 6.01 hereof, shall be fully protected in
relying upon, an Opinion of Counsel as conclusive evidence that such
amendment, waiver or supplemental indenture is authorized or permitted by
this Indenture, that it is not inconsistent herewith, and that it will be
valid and binding upon the Company and the Guarantors, if any, in
accordance with its terms.
ARTICLE IX
GUARANTEES OF SECURITIES
Section 9.01 Unconditional Guarantees
(a) For value received, the Guarantors, jointly and severally, hereby
fully, unconditionally and absolutely guarantee (the "Guarantees") to the
Holders and to the Trustee the due and punctual payment of the principal
of, and premium, if any, and interest on the Securities and all other
amounts due and payable under this Indenture and the Securities by the
Company, when and as such principal, premium, if any, and interest shall
become due and payable, whether at the stated maturity, upon redemption
or by declaration of acceleration or otherwise, according to the terms of
the Securities and this Indenture.
(b) Failing payment when due of any amount guaranteed pursuant to the
Guarantees, for whatever reason, each Guarantor will be obligated to pay
the same immediately. Each Guarantee hereunder is intended to be a
general, unsecured, senior obligation of each Guarantor and will rank
pari passu in right of payment with all Indebtedness of each such
Guarantor that is not, by its terms, expressly subordinated in right of
payment to the Guarantee of such Guarantor. Each of the Guarantors
hereby agrees that its obligations hereunder shall be full, unconditional
and absolute, irrespective of the validity, regularity or enforceability
of the Securities, the Guarantees or this Indenture, the absence of any
action to enforce the same, any waiver or consent by any Holder with
respect to any provisions hereof or thereof, any release of any other
Guarantor, the recovery of any judgment against the Company, any action
to enforce the same or any other circumstance which might otherwise
constitute a legal or equitable discharge or defense of a Guarantor. Each
of the Guarantors hereby agrees that in the event of a default in payment
of the principal of, or premium, if any, or interest on the Securities of
any series, whether at the stated maturity, upon redemption or by
declaration of acceleration or otherwise, legal proceedings may be
instituted by the Trustee on behalf of the Holders or, subject to Section
5.06 hereof, by the Holders, on the terms and conditions set forth in
this Indenture, directly against each of the Guarantors to enforce the
Guarantees without first proceeding against the Company.
(c) The obligations of each Guarantor under this Article IX shall be as
aforesaid full, unconditional and absolute and shall not be impaired,
modified, released or limited by any occurrence or condition whatsoever,
including, without limitation, (i) any compromise, settlement, release,
waiver, renewal, extension, indulgence or modification of, or any change
in, any of the obligations and liabilities of the Company or any
Guarantor contained in any of the Securities or this Indenture, (ii) any
impairment, modification, release or limitation of the liability of the
Company, any Guarantor or any of their estates in bankruptcy, or any
remedy for the enforcement thereof, resulting from the operation of any
present or future provision of any applicable Bankruptcy Law, as amended,
or other statute or from the decision of any court, (iii) the assertion
or exercise by the Company, any Guarantor or the Trustee of any rights or
remedies under any of the Securities or this Indenture or their delay in
or failure to assert or exercise any such rights or remedies, (iv) the
assignment or the purported assignment of any property as security for
any of the Securities, including all or any part of the rights of the
Company or any Guarantor under this Indenture, (v) the extension of the
time for payment by the Company or any Guarantor of any payments or other
sums or any part thereof owing or payable under any of the terms and
provisions of any of the Securities or this Indenture or of the time for
performance by the Company or any Guarantor of any other obligations
under or arising out of any such terms and provisions or the extension or
the renewal of any thereof, (vi) the modification or amendment (whether
material or otherwise) of any duty, agreement or obligation of the
Company or any Guarantor set forth in this Indenture, (vii) the voluntary
or involuntary liquidation, dissolution, sale or other disposition of all
or substantially all of the assets, marshaling of assets and liabilities,
receivership, insolvency, bankruptcy, assignment for the benefit of
creditors, reorganization, arrangement, composition or readjustment of,
or other similar proceeding affecting, the Company or any of the
Guarantors or any of their respective assets, or the disaffirmance of any
of the Securities, the Guarantees or this Indenture in any such
proceeding, (viii) the release or discharge of the Company or any
Guarantor from the performance or observance of any agreement, covenant,
term or condition contained in any of such instruments by operation of
law, (ix) the unenforceability of any of the Securities, the Guarantees
or this Indenture or (x) any other circumstance which might otherwise
constitute a legal or equitable discharge of a surety or guarantor.
(d) Each of the Guarantors hereby (i) waives diligence, presentment,
demand of payment, filing of claims with a court in the event of the
merger, insolvency or bankruptcy of the Company or a Guarantor, and all
demands whatsoever, (ii) acknowledges that any agreement, instrument or
document evidencing the Guarantees may be transferred and that the
benefit of its obligations hereunder shall extend to each holder of any
agreement, instrument or document evidencing the Guarantees without
notice to them and (iii) covenants that its Guarantee will not be
discharged except by complete performance of the Guarantees. Each
Guarantor further agrees that if at any time all or any part of any
payment theretofore applied by any Person to any Guarantee is, or must
be, rescinded or returned for any reason whatsoever, including without
limitation, the insolvency, bankruptcy or reorganization of any
Guarantor, such Guarantee shall, to the extent that such payment is or
must be rescinded or returned, be deemed to have continued in existence
notwithstanding such application, and the Guarantees shall continue to be
effective or be reinstated, as the case may be, as though such
application had not been made.
(e) Each Guarantor shall be subrogated to all rights of the Holders and
the Trustee against the Company in respect of any amounts paid by such
Guarantor pursuant to the provisions of this Indenture; provided,
however, that no Guarantor shall be entitled to enforce or to receive any
payments arising out of, or based upon, such right of subrogation with
respect to any of the Securities until all of the Securities and the
Guarantees thereof shall have been paid in full or discharged.
(f) A director, officer, employee or stockholder, as such, of any
Guarantor shall not have any liability for any obligations of such
Guarantor under this Indenture or for any claim based on, in respect of
or by reason of such obligations or their creation.
Section 9.02 Limitation of Guarantor's Liability
Each Guarantor and by its acceptance hereof each Holder hereby confirms
that it is the intention of all such parties that the guarantee by such
Guarantor pursuant to its Guarantee not constitute a fraudulent transfer
or conveyance for purposes of any federal, state or foreign law. To
effectuate the foregoing intention, the Holders and each Guarantor hereby
irrevocably agree that each Guarantor's liability shall be limited to the
lesser of (i) the aggregate amount of the obligations of the Company
under the Securities and this Indenture and (ii) the amount, if any,
which would not have (A) rendered such Guarantor "insolvent" (as such
term is defined in the Bankruptcy Law and in the Debtor and Creditor Law
of the State of New York) or (B) left such Guarantor with unreasonably
small capital at the time its Guarantee of the Securities was entered
into; provided that it will be a presumption in any lawsuit or other
proceedings in which a Guarantor is a party that the amount guaranteed
pursuant to the Guarantee is the amount set forth in clause (i) above
unless any creditor, or representative of creditors of such Guarantor, or
debtor in possession or trustee in bankruptcy of the Guarantor, otherwise
proves in such a lawsuit that the aggregate liability of the Guarantor is
the amount set forth in clause (ii) above. In making any determination
as to solvency or sufficiency of capital of a Guarantor in accordance
with the previous sentence, the right of such Guarantor to contribution
from other Guarantors, and any other rights such Guarantor may have,
contractual or otherwise, shall be taken into account.
Section 9.03 Contribution
In order to provide for just and equitable contribution among the
Guarantors, the Guarantors agree, inter se, that in the event any payment
or distribution is made by any Guarantor (a "Funding Guarantor") under
its Guarantee, such Funding Guarantor shall be entitled to a contribution
from each other Guarantor in a pro rata amount based on the Adjusted Net
Assets of each Guarantor (including the Funding Guarantor) for all
payments, damages and expenses incurred by the Funding Guarantor in
discharging the Company's obligations with respect to the Securities or
any other Guarantor's obligations with respect to its Guarantee thereof.
Section 9.04 Execution and Delivery of Guarantees
To further evidence the Guarantees, each Guarantor hereby agrees that a
notation relating to such Guarantees shall be endorsed on each Security
authenticated and delivered by the Trustee and executed by either manual
or facsimile signature of an Officer of each Guarantor.
Each of the Guarantors hereby agrees that its Guarantee shall remain in
full force and effect notwithstanding any failure to endorse on each
Security a notation relating to such Guarantee.
If an Officer of a Guarantor whose signature is on this Indenture or a
Security no longer holds that office at the time the Trustee
authenticates such Security or at any time thereafter, such Guarantor's
Guarantee of such Security shall be valid nevertheless.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of any Guarantee set
forth in this Indenture on behalf of the Guarantor.
Section 9.05 Addition of Guarantors
(a) If any Subsidiary of the Company guarantees (or becomes a co-obligor
on) any Funded Indebtedness of the Company other than the Securities at
any time subsequent to the Issue Date (including, without limitation,
following any release of such Subsidiary pursuant to Section 9.06 hereof
from any Guarantee previously provided by it under this Article IX), then
the Company shall (i) cause the Securities then outstanding to be equally
and ratably guaranteed by such Subsidiary, but only to the extent that
such Securities are not already guaranteed by such Subsidiary on
reasonably comparable terms and (ii) cause such Subsidiary to execute and
deliver a supplemental indenture, in substantially the form of Exhibit C
hereto, evidencing its provision of a Guarantee in accordance with clause
(b) below.
(b) Any Person may become a Guarantor by executing and delivering to the
Trustee (i) a supplemental indenture in form and substance satisfactory
to the Trustee, which subjects such Person to the provisions (including
the representations and warranties) of this Indenture as a Guarantor and
(ii) an Opinion of Counsel and Officers' Certificate to the effect that
such supplemental indenture has been duly authorized and executed by such
Person and constitutes the legal, valid, binding and enforceable
obligation of such Person (subject to such customary exceptions
concerning creditors' rights and equitable principles as may be
acceptable to the Trustee in its discretion and provided that no opinion
need be rendered concerning the enforceability of the Guarantee).
Section 9.06 Release of Guarantee
Notwithstanding anything to the contrary in this Article IX, in the event
that any Guarantor shall no longer be a guarantor of (or co-obligor on)
any Funded Indebtedness of the Company other than the Securities and
other than Funded Indebtedness of the Company (i) subject to a release
provision substantially similar to this Section 9.06 and (ii) the related
guarantee (or obligation) of which will be released substantially
concurrently with the release of the Guarantee of such Guarantor pursuant
to this Section 9.06, and so long as no Default or Event of Default shall
have occurred or be continuing, such Guarantor, upon giving notice to the
Trustee to the foregoing effect, shall be deemed to be released from all
of its obligations under this Indenture and the Guarantee of such
Guarantor shall be of no further force or effect. Following the receipt
by the Trustee of any such notice, the Company shall cause this Indenture
to be amended as provided in Section 8.01 hereof; provided, however, that
the failure to so amend this Indenture shall not affect the validity of
the termination of the Guarantee of such Guarantor.
Section 9.07 Consent to Jurisdiction and Service of Process
Each Guarantor that is not organized under the laws of the United States
(including the States and the District of Columbia) (each a "Non-U.S.
Guarantor") hereby appoints the principal office of CT Corporation System
in The City of New York which, on the date hereof, is located at ▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇, as the authorized agent thereof (the
"Authorized Agent") upon whom process may be served in any action, suit
or proceeding arising out of or based on this Indenture or the Securities
which may be instituted in the Supreme Court of the State of New York or
the United States District Court for the Southern District of New York,
in either case in The Borough of Manhattan, The City of New York, by the
Holder of any Security, and each Non-U.S. Guarantor hereby waives any
objection which it may now or hereafter have to the laying of venue of
any such proceeding and expressly and irrevocably accepts and submits,
for the benefit of the Holders from time to time of the Securities, to
the nonexclusive jurisdiction of any such court in respect of any such
action, suit or proceeding, for itself and with respect to its
properties, revenues and assets. Such appointment shall be irrevocable
unless and until the appointment of a successor authorized agent for such
purpose, and such successor's acceptance of such appointment, shall have
occurred. Each Non-U.S. Guarantor agrees to take any and all actions,
including the filing of any and all documents and instruments, that may
be necessary to continue such appointment in full force and effect as
aforesaid. Service of process upon the Authorized Agent with respect to
any such action shall be deemed, in every respect, effective service of
process upon any such Non-U.S. Guarantor. Notwithstanding the foregoing,
any action against any Non-U.S. Guarantor arising out of or based on any
Security may also be instituted by the Holder of such Security in any
court in the jurisdiction of organization of such Non-U.S. Guarantor, and
such Non-U.S. Guarantor expressly accepts the jurisdiction of any such
court in any such action. The Company shall require the Authorized Agent
to agree in writing to accept the foregoing appointment as agent for
service of process.
Section 9.08 Waiver of Immunity
To the extent that any Non-U.S. Guarantor or any of its properties,
assets or revenues may have or may hereafter become entitled to, or have
attributed to it, any right of immunity, on the grounds of sovereignty or
otherwise, from any legal action, suit or proceeding, from the giving of
any relief in any thereof, from set-off or counterclaim, from the
jurisdiction of any court, from service of process, from attachment upon
or prior to judgment, from attachment in aid of execution of judgment, or
from execution of judgment, or other legal process or proceeding for the
giving of any relief or for the enforcement of any judgment, in any
jurisdiction in which proceedings may at any time be commenced, with
respect to its obligations, liabilities or any other matter under or
arising out of or in connection with this Indenture or the Securities,
such Non-U.S. Guarantor, to the maximum extent permitted by law, hereby
irrevocably and unconditionally waives, and agrees not to plead or claim,
any such immunity and consents to such relief and enforcement.
Section 9.09 Judgment Currency
Each Non-U.S. Guarantor agrees to indemnify the Trustee and each Holder
against any loss incurred by it as a result of any judgment or order
being given or made and expressed and paid in a currency (the "Judgment
Currency") other than United States dollars and as a result of any
variation as between (i) the rate of exchange at which the United States
dollar amount is converted into the Judgment Currency for the purpose of
such judgment or order and (ii) the spot rate of exchange in The City of
New York at which the Trustee or such Holder on the date of payment of
such judgment or order is able to purchase United States dollars with the
amount of the Judgment Currency actually received by the Trustee or such
Holder. The foregoing indemnity shall constitute a separate and
independent obligation of each Non-U.S. Guarantor and shall continue in
full force and effect notwithstanding any such judgment or order as
aforesaid. The term "spot rate of exchange" shall include any premiums
and costs of exchange payable in connection with the purchase of, or
conversion into, United States dollars.
ARTICLE X
REDEMPTION
Section 10.01 Notices to Trustee
If the Company elects to redeem the Securities of any series pursuant to
the redemption provisions of Section 10.07, it shall furnish to the
Trustee, at least 45 days but not more than 60 days before a Redemption
Date (unless the Trustee consents in writing to a shorter period of at
least 30 days prior to the Redemption Date), an Officers' Certificate
setting forth the Redemption Date, the principal amount of such
Securities to be redeemed and the Redemption Price.
Section 10.02 Selection of Securities to be Redeemed
If less than all of the Securities of a series are to be redeemed, the
Trustee shall select the Securities of such series to be redeemed by such
method as the Trustee in its sole discretion shall deem fair and
appropriate. The particular Securities of such series to be redeemed
shall be selected, unless otherwise provided herein, not less than 30
days nor more than 60 days prior to the Redemption Date by the Trustee
from the outstanding Securities of such series not previously called for
redemption.
The Trustee shall promptly notify the Company in writing of the
Securities of such series selected for redemption and, in the case of any
Security selected for partial redemption, the principal amount thereof to
be redeemed. Securities and portions of them selected shall be in
amounts of $1,000 or whole multiples of $1,000. Except as provided in
the preceding sentence, provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities
called for redemption.
Section 10.03 Notices to Holders
(a) At least 30 days but not more than 60 days before a Redemption Date,
the Company shall mail in conformity with Section 11.02 a notice of
redemption to each Holder whose Securities are to be redeemed.
The Notice shall identify the Securities to be redeemed and shall state:
(i) the Redemption Date;
(ii) the Redemption Price;
(iii) if any Security is being redeemed in part, the portion of
the principal amount of such Security to be redeemed and that, after
the Redemption Date, upon surrender of such Security, a new Security
or Securities in principal amount equal to the unredeemed portion
will be issued;
(iv) the name and address of the Paying Agent;
(v) that Securities called for redemption must be surrendered to
the Paying Agent at the address specified in such notice to collect
the Redemption Price;
(vi) that unless the Company defaults in making the redemption
payment, interest on Securities called for redemption ceases to
accrue on and after the Redemption Date and the only remaining right
of the Holders is to receive payment of the Redemption Price upon
surrender to the Paying Agent of the Securities; and
(vii) the aggregate principal amount of Securities of each
series being redeemed.
If any of the Securities to be redeemed is in the form of a Global
Security, then the Company shall modify such notice to the extent
necessary to accord with the procedures of the Depositary applicable to
redemptions.
(b) At the Company's request, the Trustee shall give the notice required
in Section 10.03(a) in the Company's name; provided, however, that the
Company shall deliver to the Trustee, at least 45 days prior to the
Redemption Date (unless the Trustee consents in writing to a shorter
period at least 30 days prior to the Redemption Date), an Officer's
Certificate requesting that the Trustee give such notice and setting
forth the information to be stated in such notice as provided in Section
10.03(a).
Section 10.04 Effect of Notices of Redemption
Once notice of redemption is mailed pursuant to Section 10.03, Securities
called for redemption become due and payable on the Redemption Date at
the Redemption Price. Upon surrender to the Paying Agent, such
Securities shall be paid out at the Redemption Price.
Section 10.05 Deposit of Redemption Price
At least one Business Day prior to the Redemption Date, the Company shall
deposit with the Trustee or with the Paying Agent money sufficient to pay
the Redemption Price of all Securities to be redeemed on that date. The
Trustee or the Paying Agent shall return to the Company any money not
required for that purpose less the expenses of the Trustee as provided
herein.
If the Company complies with the preceding paragraph, interest on the
Securities or portions thereof to be redeemed (whether or not such
Securities are presented for payment) will cease to accrue on the
applicable Redemption Date. If any Security called for redemption shall
not be so paid upon surrender because of the failure of the Company to
comply with the preceding paragraph, then interest will be paid on the
unpaid principal and premium, if any, from the Redemption Date until such
principal and premium are paid and, to the extent lawful, on any interest
not paid on such unpaid principal, in each case at the rate provided in
the Securities and in Section 3.01.
Section 10.06 Securities Redeemed in Part
Upon surrender of a Security that is redeemed in part, the Company shall
issue and the Trustee shall authenticate for the Holder, at the expense
of the Company, a new Security equal in principal amount to the
unredeemed portion of the Security surrendered.
Section 10.07 Optional Redemption
The Securities of any series (other than the 5-year Securities) may be
redeemed at any time, at the option of the Company, in whole or from time
to time in part, at the Redemption Price specified in such Securities.
Any redemption pursuant to this Section 10.07 shall be made, to the
extent applicable, pursuant to the provisions of Sections 10.01 through
10.06.
ARTICLE XI
MISCELLANEOUS
Section 11.01 Trust Indenture Act Controls
If any provision of this Indenture limits, qualifies or conflicts with
another provision which is required to be included in this Indenture by
the TIA, the required provision shall control. If this Indenture excludes
any provision of the TIA that is required to be included, such provision
shall be deemed included herein.
Section 11.02 Notices
Any notice or communication by the Company, the Guarantors, if any, or
the Trustee to the others is duly given if in writing and delivered in
person or mailed by first-class mail (registered or certified, return
receipt requested), telecopier or overnight air courier guaranteeing next
day delivery, to the other's address:
If to the Company or the Guarantors:
R&B Falcon Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
If to the Trustee:
For payment registration, transfer or exchange of the Securities:
By Hand:
Chase Bank of Texas, National Association
One Main Place
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: Registered Bond Events
Telecopier No. (▇▇▇) ▇▇▇-▇▇▇▇
By Mail:
Chase Bank of Texas, National Association
P. O. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Registered Bond Events
For all other communications relating to the Securities:
Chase Bank of Texas, National Association
Global Trust Services
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Address of the Trustee in New York:
For Physical Securities:
The Chase Manhattan Bank
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇, Windows 20 and ▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ or 7381
For Book Entry Securities:
The Chase Manhattan Bank
DTC Participant #2423
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ or 7381
The Company, the Guarantors or the Trustee by notice to the others may
designate additional or different addresses for subsequent notices or
communications.
All notices and communications shall be deemed to have been duly given:
at the time delivered by hand, if personally delivered; five Business
Days after being deposited in the mail, postage prepaid, if mailed; when
receipt acknowledged, if telecopied; and the next Business Day after
timely delivery to the courier, if sent by overnight air courier
guaranteeing next day delivery. Notwithstanding the foregoing, notices
to the Trustee shall be effective only upon receipt.
Any notice or communication to a Holder shall be mailed by first-class
mail, postage prepaid, to the Holder's address shown on the register kept
by the Registrar. Failure to mail a notice or communication to a Holder
or any defect in it shall not affect its sufficiency with respect to
other Holders.
If a notice or communication is mailed in the manner provided above
within the time prescribed, it is duly given, whether or not the
addressee receives it.
If the Company or any Guarantor mails a notice or communication to
Holders, it shall mail a copy to the Trustee and each Agent at the same
time.
All notices or communications, including without limitation notices to
the Trustee or the Company or any Guarantor by Holders, shall be in
writing, except as set forth below, and in the English language.
In case by reason of the suspension of regular mail service, or by reason
of any other cause, it shall be impossible to mail any notice required by
this Indenture, then such method of notification as shall be made with
the approval of the Trustee shall constitute a sufficient mailing of such
notice.
Section 11.03 Communication by Holders with Other Holders
Holders may communicate pursuant to TIA Section 312(b) with other Holders
with respect to their rights under this Indenture or the Securities. The
Company, the Guarantors, the Trustee, the Registrar and anyone else shall
have the protection of TIA Section 312(c).
Section 11.04 Certificate and Opinion as to Conditions Precedent
Upon any request or application by the Company or any Guarantor to the
Trustee to take any action under this Indenture, the Company or such
Guarantor shall, if requested by the Trustee, furnish to the Trustee:
(1) an Officers' Certificate (which shall include the
statements set forth in Section 11.05 hereof) stating
that, in the opinion of the signers, all conditions
precedent and covenants, if any, provided for in this
Indenture relating to the proposed action have been
complied with; and
(2) an Opinion of Counsel (which shall include the
statements set forth in Section 11.05 hereof) stating
that, in the opinion of such counsel, all such conditions
precedent and covenants have been complied with.
Section 11.05 Statements Required in Certificate or Opinion
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture shall include:
(1) a statement that the Person making such certificate
or opinion has read such covenant or condition;
(2) a brief statement as to the nature and scope of the
examination or investigation upon which the statements or
opinions contained in such certificate or opinion are
based;
(3) a statement that, in the opinion of such Person, he
has made such examination or investigation as is necessary
to enable him to express an informed opinion as to whether
or not such covenant or condition has been complied with;
and
(4) a statement as to whether or not, in the opinion of
such Person, such condition or covenant has been complied
with.
Section 11.06 Rules by Trustee and Agents
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or the Paying Agent may make reasonable rules and
set reasonable requirements for its functions.
Section 11.07 Legal Holidays
If a payment date is a Legal Holiday at a place of payment, payment may
be made at that place on the next succeeding day that is not a Legal
Holiday, and no interest shall accrue for the intervening period.
Section 11.08 No Recourse Against Others
A director, officer, employee or stockholder of the Company or any
Guarantor, as such, shall not have any liability for any obligations of
the Company or such Guarantor under the Securities or this Indenture or
for any claim based on, in respect of or by reason of such obligations or
their creation. Each Holder by accepting a Security waives and releases
all such liability. The waiver and release shall be part of the
consideration for the issue of the Securities.
Section 11.09 Governing Law
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUCTED IN
ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK.
Section 11.10 No Adverse Interpretation of Other Agreements
This Indenture may not be used to interpret another indenture, loan or
debt agreement of the Company, any Guarantor or any other Subsidiary of
the Company. Any such indenture, loan or debt agreement may not be used
to interpret this Indenture.
Section 11.11 Successors
All agreements of the Company and the Guarantors in this Indenture and
the Securities shall bind their respective successors. All agreements of
the Trustee in this Indenture shall bind its successor.
Section 11.12 Severability
In case any provision in this Indenture or in the Securities shall be
invalid, illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way be
affected or impaired thereby.
Section 11.13 Counterpart Originals
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 11.14 Table of Contents, Headings, etc
The Table of Contents, Cross-Reference Table and Headings of the Articles
and Sections of this Indenture have been inserted for convenience of
reference only, are not to be considered a part hereof and shall in no
way modify or restrict any of the terms or provisions hereof.
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed as of the day and year first above written.
R&B FALCON CORPORATION
By: /S/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Executive Vice President
CHASE BANK OF TEXAS, NATIONAL
ASSOCIATION
By: /S/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President and
Trust Officer
EXHIBIT A
[FACE OF 5-YEAR SECURITY]
R&B FALCON CORPORATION
9-1/8% SERIES [A/B] SENIOR NOTE DUE 2003
CUSIP 74912 EAJ0
No. ___ $___________
R&B Falcon Corporation, a Delaware corporation (the "Company"), for value
received promises to pay to ___________________________ or registered
assigns, the principal sum of $_________ Dollars on December [ ],
200__ [or such greater or lesser amount as is indicated on the Schedule
of Exchanges of Securities on the other side of this Security].*
Interest Payment Dates: June 15 and December 15
Record Dates: June 1 and December 1
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
Dated:
R&B FALCON CORPORATION
By:_________________________
By:_________________________
Certificate of Authentication:
_________________________
as Trustee, certifies that this is one
of the Securities referred to in the
within-mentioned Indenture.
By:______________________
Authorized Signature
[Global Securities Legend]
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE
BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY
THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITARY. THE DEPOSITARY TRUST COMPANY SHALL ACT AS
THE DEPOSITARY UNTIL A SUCCESSOR SHALL BE APPOINTED BY THE COMPANY AND
THE REGISTRAR. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇) ("▇▇▇"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]*
[Transfer Restricted Securities Legend]
[THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS
HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED
BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES FOR THE
BENEFIT OF THE COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) INSIDE THE UNITED STATES TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN
AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES
ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (IV)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT,
IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF
THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
ABOVE.]*
[REVERSE OF 5-YEAR SECURITY]
R&B FALCON CORPORATION
9-1/2% SERIES [A/B] SENIOR NOTE DUE 2003
This Security is one of a duly authorized issue of 9-1/2% Series [A/B]
Senior Notes due 2003 (the "Securities") of R&B Falcon Corporation, a
Delaware corporation (the "Company").
1. Interest. The Company promises to pay interest on the principal
amount of this Security at 9-1/2% per annum from December 22, 1998 until
maturity. The Company will pay interest semiannually on June 15 and
December 15 of each year (each an "Interest Payment Date"), or if any
such day is not a Business Day, on the next succeeding Business Day.
Interest on the Securities will accrue from the most recent Interest
Payment Date on which interest has been paid or, if no interest has been
paid, from December 22, 1998; provided that if there is no existing
Default in the payment of interest, and if this Security is authenticated
between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first
Interest Payment Date shall be June 15, 1999. The Company also promises
to pay any additional interest required by Section 6 of the Registration
Rights Agreement (as defined in paragraph 17 below), upon the conditions,
at the rates and for the periods specified therein. Further, the Company
shall pay interest on overdue principal and premium, if any, from time to
time on demand at a rate equal to the interest rate then in effect; it
shall pay interest on overdue installments of interest (without regard to
any applicable grace periods) from time to time on demand at the same
rate to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
2. Method of Payment. The Company will pay interest on the Securities
(except defaulted interest) to the Persons who are registered Holders of
Securities at the close of business on the record date next preceding the
Interest Payment Date, even if such Securities are canceled after such
record date and on or before such Interest Payment Date. The Holder must
surrender this Security to a Paying Agent to collect principal and
premium, if any, payments. The Company will pay the principal of, and
premium, if any, and interest on the Securities in money of the United
States of America that at the time of payment is legal tender for payment
of public and private debts. Payments in respect of the Securities
represented by a Global Security (including principal, premium, if any,
and interest) will be made by wire transfer of immediately available
funds to the accounts specified by The Depository Trust Company. The
Company will make all payments in respect of a certificated Security
(including principal, premium, if any, and interest) by mailing a check
to the registered address of each Holder thereof; provided, however, that
payments on a certificated Security will be made by wire transfer to a
U.S. dollar account maintained by the payee with a bank in the United
States if such Holder elects payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such
account no later than 30 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its
discretion).
3. Ranking and Guarantees. The Securities are senior unsecured
obligations of the Company. The Indenture provides that any Subsidiary
that guarantees Funded Indebtedness of the Company after the Issue Date
will be required to equally and ratably guarantee the Securities. The
Guarantee of the Securities by any subsidiary may be released if, but
only so long as, no other Funded Indebtedness of the Company is
guaranteed by such Subsidiary. Each of the Guarantees is an unsecured
obligation of the Guarantor providing such Guarantee. Certain
limitations to the obligations of the Guarantors are set forth in further
detail in the Indenture. References herein to the Indenture or the
Securities shall be deemed also to refer to the Guarantees set forth in
the Indenture except where the context otherwise requires.
4. Optional Redemption. The Securities may be redeemed at any time, at
the option of the Company, in whole or from time to time in part, at a
price equal to 100% of their principal amount plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of holders
of record on the relevant record date to receive interest due on an
interest payment date that is on or prior to the Redemption Date) plus
the Make-Whole Premium, if any (the "Redemption Price").
The amount of the Make-Whole Premium with respect to any Security (or
portion thereof) to be redeemed will be equal to the excess, if any, of:
(i) the sum of the present values, calculated as of the Redemption
Date, of:
(A) each interest payment that, but for such redemption would
have been payable on the Security (or portion thereof) being
redeemed on each Interest Payment Date occurring after the
Redemption Date (excluding any accrued and unpaid interest for
the period prior to the Redemption Date); and
(B) the principal amount that, but for such redemption, would
have been payable at the final maturity of the Security (or
portion thereof) being redeemed;
over
(ii) the principal amount of the Security (or portion thereof) being
redeemed.
The present values of interest and principal payments referred to in
clause (i) above will be determined in accordance with generally accepted
principles of financial analysis. Such present values will be calculated
by discounting the amount of each payment of interest or principal from
the date that each such payment would have been payable, but for the
redemption, to the Redemption Date at a discount rate equal to the
Treasury Yield plus 50 basis points. The Make-Whole Premium will be
calculated by an Independent Investment Banker (as defined in the
Indenture).
For purposes of determining the Make-Whole Premium, "Treasury Yield"
means a rate of interest per annum equal to the weekly average yield to
maturity of United States Treasury Notes that have a constant maturity
that corresponds to the remaining term to maturity of the Securities,
calculated to the nearest 1/12 of a year (the "Remaining Term"). The
Treasury Yield will be determined as of the third Business Day
immediately preceding the applicable Redemption Date. The weekly average
yields of United States Treasury Notes will be determined by reference to
the most recent statistical release published by the Federal Reserve Bank
of New York and designated "H.15(519) Selected Interest Rates" or any
successor release (the "H.15 Statistical Release"). If the H.15
Statistical Release sets forth a weekly average yield for United States
Treasury Notes having a constant maturity that is the same as the
Remaining Term, then Treasury Yield will be equal to such weekly average
yield. In all other cases, the Treasury Yield will be calculated by
interpolation, on a straight-line basis, between the weekly average
yields on the United States Treasury Notes that have a constant maturity
closest to and greater than the Remaining Term and the United States
Treasury Notes that have a constant maturity closest to and less than the
Remaining Term (in each case as set forth in the H.15 Statistical
Release). Any weekly average yields so calculated by interpolation will
be rounded to the nearest 1/100 of 1%, with any figure of 1/200% or above
being rounded upward. If weekly average yields for United States
Treasury Notes are not available in the H.15 Statistical Release or
otherwise, then the Treasury Yield will be calculated by interpolation of
comparable rates selected by the Independent Investment Banker.
Periodic interest installments with respect to which the Interest Payment
Date is on or prior to any Redemption Date will be payable to Holders of
record at the close of business on the relevant record dates referred to
herein, all as provided in the Indenture.
Notice of redemption will be mailed at least 30 days but not more than 60
days before the Redemption Date to each Holder of Securities to be
redeemed at his registered address. Securities in denominations larger
than $1,000 may be redeemed in part but only in whole multiples of
$1,000. On or after the Redemption Date interest will cease to accrue on
Securities or on the portions thereof called for redemption, as the case
may be.
5. Paying Agent and Registrar. Initially, Chase Bank of Texas,
National Association (the "Trustee"), the Trustee under the Indenture,
will act as Paying Agent and Registrar. The Company may change any
Paying Agent, Registrar, co-registrar or additional paying agent without
notice to any Holder. The Company may act in any such capacity.
6. Indenture. The Company issued the Securities under an Indenture
dated as of December 22, 1998 (the "Indenture") among the Company and the
Trustee. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb),
as in effect on the date of execution of the Indenture. The Securities
are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. The Securities are unsecured
general obligations of the Company.
7. Denominations, Transfer, Exchange. The Securities are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Securities may be registered and Securities may
be exchanged as provided in the Indenture. The Registrar and the Trustee
may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not
exchange or register the transfer of any Securities during the period
between a record date and the corresponding Interest Payment Date.
8. Persons Deemed Owners. The registered Holder of a Security shall be
treated as its owner for all purposes.
9. Amendments and Waivers. Subject to certain exceptions and
limitations, the Indenture or the Securities may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Securities, and any existing
Default under, or compliance with any provision of, the Indenture may be
waived (other than any continuing Default or Event of Default in the
payment of the principal of, or premium, if any, or interest on the
Securities) by the Holders of at least a majority in principal amount of
the Securities then outstanding in accordance with the terms of the
Indenture. Without the consent of any Holder, the Company, any
Guarantors and the Trustee may amend or supplement the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency; to
provide for uncertificated Securities in addition to or in place of
certificated Securities; to provide for the assumption of the obligations
of the Company and any Guarantor under the Indenture to Holders in the
case of the merger, consolidation or sale or other disposition of all or
substantially all of the assets of the Company or any Guarantor; to
reflect the release of any Guarantor from its Guarantee to the extent
permitted by the Indenture; to add guarantees to the Securities; to add
to the covenants of the Company or any Guarantors or to surrender any
right of the Company or any Guarantor; to make any change that does not
materially adversely affect the rights of any Holder; or to comply with
the qualification of the Indenture under the Trust Indenture Act of 1939,
as amended.
The right of any Holder to participate in any consent required or sought
pursuant to any provision of the Indenture (and the obligation of the
Company to obtain any such consent otherwise required from such Holder)
may be subject to the requirement that such Holder shall have been the
Holder of record of any Securities with respect to which such consent is
required or sought as of a date identified by the Trustee in a notice
furnished to Holders in accordance with the terms of the Indenture.
Without the consent of each Holder affected, the Company may not (i)
reduce the amount of Securities whose Holders must consent to an
amendment, supplement or waiver, (ii) reduce the rate of or change the
time for payment of interest, including default interest, on any
Security, (iii) reduce the principal of or change the fixed maturity of
any Security or alter the premium or other provisions with respect to
redemption, (iv) make any Security payable in money other than that
stated in the Security, (v) impair the right to institute suit for the
enforcement of any payment of principal of, or premium, if any, or
interest on any Security, (vi) make any change in the percentage of
principal amount of Securities necessary to waive compliance with certain
provisions of the Indenture or (vii) waive a continuing Default or Event
of Default in the payment of principal of, or premium, if any, or
interest on the Securities.
10. Defaults and Remedies. Events of Default include: default in payment
of interest on the Securities for 30 days; default in payment of
principal of, or premium, if any, on the Securities; failure by the
Company or any Guarantor for 60 days after written notice by the Trustee
or by the Holders of at least 25% of the aggregate principal amount of
the Securities then outstanding to it to comply with any of its other
covenants or agreements in the Indenture, the Guarantees or the
Securities; the acceleration of the maturity of any Indebtedness of the
Company or any Subsidiary of the Company (other than the Securities or
any Non-Recourse Indebtedness) that has an outstanding principal amount
of $20 million or more individually or in the aggregate; a default in the
payment of principal or interest in respect of any Indebtedness of the
Company or any Subsidiary of the Company (other than the Securities or
any Non-Recourse Indebtedness) having an outstanding principal amount of
$20 million or more individually or in the aggregate, and such default
shall be continuing for a period of 30 days without the Company or such
Subsidiary, as the case may be, effecting a cure of such default; a final
judgment or order for the payment of money in excess of $20 million (net
of applicable insurance coverage) having been rendered against the
Company, any Guarantor or any other "significant subsidiary" (as such
term is defined in Regulation S-X under the Securities Exchange Act of
1934, as amended; a "Significant Subsidiary") of the Company and such
judgment or order shall continue unsatisfied and unstayed for a period of
60 days; or certain events involving bankruptcy, insolvency or
reorganization of the Company, any Guarantor or any other Significant
Subsidiary of the Company. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Securities may declare the principal of,
and premium, if any, and interest on all the Securities to be immediately
due and payable, except that in the case of an Event of Default arising
from certain events of bankruptcy, insolvency or reorganization of the
Company or any Guarantor, all outstanding Securities become due and
payable immediately without further action or notice. The amount due and
payable upon the acceleration of any Security is equal to 100% of the
principal amount thereof plus premium, if any, and accrued interest to
the date of payment. Holders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may require
indemnity reasonably satisfactory to it before it enforces the Indenture
or the Securities. Subject to certain limitations, Holders of a majority
in principal amount of the then outstanding Securities may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold
from Holders notice of any continuing default (except a default in
payment of principal or premium, if any, or interest) if it determines
that withholding notice is in their interests. The Company must furnish
an annual compliance certificate to the Trustee.
11. Discharge Prior to Maturity. The Indenture shall be discharged and
canceled upon the payment of all of the Securities and shall be
discharged except for certain obligations upon the irrevocable deposit
with the Trustee of funds or U.S. Government Obligations sufficient for
such payment.
12. Trustee Dealings with Company and Guarantors. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company, any Guarantors or their
respective Affiliates, and may otherwise deal with the Company, any
Guarantors or their respective Affiliates, as if it were not Trustee.
13. No Recourse Against Others. A director, officer, employee or
stockholder, as such, of the Company or any Guarantor shall not have any
liability for any obligations of the Company or any Guarantor under the
Securities or the Indenture or for any claim based on, in respect of or
by reason of such obligations or their creation. Each Holder by
accepting a Security waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of the
Securities.
14. Authentication. This Security shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.
15. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Securities as a convenience to
the Holders of the Securities. No representation is made as to the
accuracy of such numbers as printed on the Securities and reliance may be
placed only on the other identification numbers printed thereon.
16. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and
U/G/M/A (= Uniform Gifts to Minors Act).
17. Additional Rights of Holders of Transfer Restricted Securities. In
addition to the rights provided to Holders of Securities under the
Indenture, Holders of Transfer Restricted Securities shall have all the
rights set forth in the Registration Rights Agreement, dated as of the
Issue Date (the "Registration Rights Agreement"), among the Company and
the Initial Purchasers.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Request may be made to:
R&B Falcon Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
FORM OF NOTATION ON SECURITY
RELATING TO FUTURE GUARANTEES
Each Guarantor (which term includes any successor Person under the
Indenture), has fully, unconditionally and absolutely guaranteed, to the
extent set forth in the Indenture and subject to the provisions in the
Indenture, the due and punctual payment of the principal of, and premium,
if any, and interest on the Securities and all other amounts due and
payable under the Indenture and the Securities by the Company.
The obligations of the Guarantors to the Holders of Securities and to the
Trustee pursuant to the Guarantees and the Indenture are expressly set
forth in Article IX of the Indenture and reference is hereby made to the
Indenture for the precise terms of the Guarantees.
[NAMES OF GUARANTORS]
By:____________________
ASSIGNMENT FORM
To assign this Security, fill in the form below: (I) or (we) assign and
transfer this Security to _________________________________________
______________________________________________________________________
(Insert assignee's social security or tax I.D. number)
_______________________________________________________________________
_______________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ____________________________________________ as
agent to transfer this Security on the books of the Company. The agent
may substitute another to act for him.
Date: ___________________________
Your Signature:________________________________________________________
(Sign exactly as your name appears on the face of this Security)
Signature Guarantee:___________________________________________________
(Participant in a Recognized Signature Guaranty Medallion
Program)
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to in
Rule 144(k) under the Securities Act after the later of the date of original
issuance of such Securities and the last date, if any, on which such
Securities were owned by the Company or any Affiliate of the Company, the
undersigned confirms that such Securities are being transferred as specified
below:
CHECK ONE
(1) [] to the Company or a Subsidiary thereof; or
(2) [] to a "qualified institutional buyer" (as defined in Rule 144A under
the Securities Act of 1933, as amended) that purchases for its own
account or for the account of a qualified institutional buyer to
whom notice is given that such transfer is being made in reliance
on Rule 144A, in each case pursuant to and in compliance with Rule
144A under the Securities Act of 1933, as amended; or
(3) [] outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as
amended; or
(4) [] pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(5) [] pursuant to an exemption from the registration requirements of the
Securities Act of 1933, as amended, provided by Rule 144 thereunder.
and unless the box below is checked, the undersigned confirms that such
Security is not being transferred to an "affiliate" of the Company as
defined in Rule 144 under the Securities Act of 1933, as amended (an
"Affiliate"):
[] The transferee is an Affiliate of the Company.
Unless one of items (1) through (5) above is checked, the Trustee will
refuse to register any of the Securities evidenced by this certificate in
the name of any person other than the registered Holder thereof; provided,
however, that if item (3), or (5) is checked, the Company or the Trustee
may require, prior to registering any such transfer of the Securities, in
their sole discretion, such written legal opinions, certifications
(including an investment letter) and other information as the Trustee or
the Company have reasonably requested to confirm that such transfer is
being made pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act of 1933, as amended.
If none of the foregoing items are checked, the Trustee or Registrar shall
not be obligated to register this Security in the name of any person other
than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 2.06 of the
Indenture shall have been satisfied.
Signed:____________________
(Sign exactly as your name appears on the
other side of this Security)
Signature Guarantee:________________________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities
Act of 1933, as amended and is aware that the sale to it is being made in
reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as the undersigned has requested
pursuant to Rule 144A or has determined not to request such information
and that it is aware that the transferor is relying upon the undersigned's
foregoing representations in order to claim the exemption from registration
provided by Rule 144A.
Dated:_________________ _________________________
Notice: to be executed by an
executive officer*
SCHEDULE OF EXCHANGES OF SECURITIES*
The following exchanges, redemptions or repurchases of a part of this Global
Security have been made:
Principal
Amount of Signature of
Global authorized
Security Officer,
Amount of decrease Amount of increase following Trustee
Date of in Principal Amount in Principal Amount such decrease or Securities
Transaction of Global Security of Global Security (or increase) Custodian
----------- ------------------- ------------------- ------------- -------------
*This Schedule should be included only if the Security is a Global Security.
EXHIBIT B
[FACE OF 10-YEAR SECURITY]
R&B FALCON CORPORATION
9-1/2% SERIES [A/B] SENIOR NOTE DUE 2008
CUSIP 74912 EAL5
No. ___ $___________
R&B Falcon Corporation, a Delaware corporation (the "Company"), for value
received promises to pay to ___________________________ or registered
assigns, the principal sum of $_________ Dollars on December ___, 2008
[or such greater or lesser amount as is indicated on the Schedule of
Exchanges of Securities on the other side of this Security.*]
Interest Payment Dates: June 15 and December 15
Record Dates: June 1 and December 1
Reference is hereby made to the further provisions of this Security set
forth on the reverse hereof, which further provisions shall for all
purposes have the same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Security to be signed
manually or by facsimile by its duly authorized officers.
Dated:
R&B FALCON CORPORATION
By:_________________________
By:_________________________
Certificate of Authentication:
____________________________
as Trustee, certifies that this is one
of the Securities referred to in the
within-mentioned Indenture.
By:_____________________
Authorized Signature
[Global Securities Legend]
[UNLESS AND UNTIL IT IS EXCHANGED IN WHOLE OR IN PART FOR SECURITIES IN
DEFINITIVE FORM, THIS SECURITY MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE
BY THE DEPOSITARY TO A NOMINEE OF THE DEPOSITARY OR BY A NOMINEE OF THE
DEPOSITARY TO THE DEPOSITARY OR ANOTHER NOMINEE OF THE DEPOSITARY OR BY
THE DEPOSITARY OR ANY SUCH NOMINEE TO A SUCCESSOR DEPOSITARY OR A NOMINEE
OF SUCH SUCCESSOR DEPOSITARY. THE DEPOSITORY TRUST COMPANY SHALL ACT AS
THE DEPOSITARY UNTIL A SUCCESSOR SHALL BE APPOINTED BY THE COMPANY AND
THE REGISTRAR. UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (55 ▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇
▇▇▇▇, ▇▇▇ ▇▇▇▇) ("▇▇▇"), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED
IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO.
OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED REPRESENTATIVE
OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE
BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF,
CEDE & CO., HAS AN INTEREST HEREIN.]*
[Transfer Restricted Securities Legend]
[THIS SECURITY (OR ITS PREDECESSOR) WAS ORIGINALLY ISSUED IN A
TRANSACTION EXEMPT FROM REGISTRATION UNDER THE UNITED STATES SECURITIES
ACT OF 1933 (THE "SECURITIES ACT"), AND THIS SECURITY MAY NOT BE OFFERED,
SOLD OR OTHERWISE TRANSFERRED IN THE ABSENCE OF SUCH REGISTRATION OR AN
APPLICABLE EXEMPTION THEREFROM. EACH PURCHASER OF THIS SECURITY IS
HEREBY NOTIFIED THAT THE SELLER OF THIS SECURITY MAY BE RELYING ON THE
EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED
BY RULE 144A THEREUNDER.
THE HOLDER OF THIS SECURITY, BY ITS ACCEPTANCE HEREOF, AGREES FOR THE
BENEFIT OF THE COMPANY THAT (A) THIS SECURITY MAY BE OFFERED, RESOLD,
PLEDGED OR OTHERWISE TRANSFERRED, ONLY (1) INSIDE THE UNITED STATES TO A
PERSON WHOM THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL
BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION
MEETING THE REQUIREMENTS OF RULE 144A, (II) OUTSIDE THE UNITED STATES IN
AN OFFSHORE TRANSACTION IN ACCORDANCE WITH RULE 904 UNDER THE SECURITIES
ACT, (III) PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER THE
SECURITIES ACT PROVIDED BY RULE 144 THEREUNDER (IF AVAILABLE) OR (IV)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES ACT,
IN EACH OF CASES (I) THROUGH (IV) IN ACCORDANCE WITH ANY APPLICABLE
SECURITIES LAWS OF ANY STATE OF THE UNITED STATES, AND (B) THE HOLDER
WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER OF
THIS SECURITY FROM IT OF THE RESALE RESTRICTIONS REFERRED TO IN (A)
ABOVE.]*
[REVERSE OF 10-YEAR SECURITY]
R&B FALCON CORPORATION
9-1/2% SERIES [A/B] SENIOR NOTE DUE 2008
This Security is one of a duly authorized issue of 9-1/2% Series [A/B]
Senior Notes due 2008 (the "Securities") of R&B Falcon Corporation, a
Delaware corporation (the "Company").
1. Interest. The Company promises to pay interest on the principal
amount of this Security at 9-1/2% per annum from December 22, 1998 until
maturity. The Company will pay interest semiannually on June 15 and
December 15 of each year (each an "Interest Payment Date"), or if any
such day is not a Business Day, on the next succeeding Business Day.
Interest on the Securities will accrue from the most recent Interest
Payment Date on which interest has been paid or, if no interest has been
paid, from December 22, 1998; provided that if there is no existing
Default in the payment of interest, and if this Security is authenticated
between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date; provided, further, that the first
Interest Payment Date shall be June 15, 1999. The Company also promises
to pay any additional interest required by Section 6 of the Registration
Rights Agreement (as defined in paragraph 17 below), upon the conditions,
at the rates and for the periods specified therein. Further, the Company
shall pay interest on overdue principal and premium, if any, from time to
time on demand at a rate equal to the interest rate then in effect; it
shall pay interest on overdue installments of interest (without regard to
any applicable grace periods) from time to time on demand at the same
rate to the extent lawful. Interest will be computed on the basis of a
360-day year of twelve 30-day months.
2. Method of Payment. The Company will pay interest on the Securities
(except defaulted interest) to the Persons who are registered Holders of
Securities at the close of business on the record date next preceding the
Interest Payment Date, even if such Securities are canceled after such
record date and on or before such Interest Payment Date. The Holder must
surrender this Security to a Paying Agent to collect principal and
premium, if any, payments. The Company will pay the principal of, and
premium, if any, and interest on the Securities in money of the United
States of America that at the time of payment is legal tender for payment
of public and private debts. Payments in respect of the Securities
represented by a Global Security (including principal, premium, if any,
and interest) will be made by wire transfer of immediately available
funds to the accounts specified by The Depository Trust Company. The
Company will make all payments in respect of a certificated Security
(including principal, premium, if any, and interest) by mailing a check
to the registered address of each Holder thereof; provided, however, that
payments on a certificated Security will be made by wire transfer to a
U.S. dollar account maintained by the payee with a bank in the United
States if such Holder elects payment by wire transfer by giving written
notice to the Trustee or the Paying Agent to such effect designating such
account no later than 30 days immediately preceding the relevant due date
for payment (or such other date as the Trustee may accept in its
discretion).
3. Ranking and Guarantees. The Securities are senior unsecured
obligations of the Company. The Indenture provides that any Subsidiary
that guarantees Funded Indebtedness of the Company after the Issue Date
will be required to equally and ratably guarantee the Securities. The
Guarantee of the Securities by any subsidiary may be released if, but
only so long as, no other Funded Indebtedness of the Company is
guaranteed by such Subsidiary. Each of the Guarantees is an unsecured
obligation of the Guarantor providing such Guarantee. Certain
limitations to the obligations of the Guarantors are set forth in further
detail in the Indenture. References herein to the Indenture or the
Securities shall be deemed also to refer to the Guarantees set forth in
the Indenture except where the context otherwise requires.
4. Optional Redemption. The Securities may be redeemed at any time, at
the option of the Company, in whole or from time to time in part, at a
price equal to 100% of their principal amount plus accrued and unpaid
interest, if any, to the Redemption Date (subject to the right of holders
of record on the relevant record date to receive interest due on an
interest payment date that is on or prior to the Redemption Date) plus
the Make-Whole Premium, if any (the "Redemption Price").
The amount of the Make-Whole Premium with respect to any Security (or
portion thereof) to be redeemed will be equal to the excess, if any, of:
(i) the sum of the present values, calculated as of the Redemption
Date, of:
(A) each interest payment that, but for such redemption would
have been payable on the Security (or portion thereof) being
redeemed on each Interest Payment Date occurring after the
Redemption Date (excluding any accrued and unpaid interest for
the period prior to the Redemption Date); and
(B) the principal amount that, but for such redemption, would
have been payable at the final maturity of the Security (or
portion thereof) being redeemed;
over
(ii) the principal amount of the Security (or portion thereof) being
redeemed.
The present values of interest and principal payments referred to in
clause (i) above will be determined in accordance with generally accepted
principles of financial analysis. Such present values will be calculated
by discounting the amount of each payment of interest or principal from
the date that each such payment would have been payable, but for the
redemption, to the Redemption Date at a discount rate equal to the
Treasury Yield plus 50 basis points. The Make-Whole Premium will be
calculated by an Independent Investment Banker (as defined in the
Indenture).
For purposes of determining the Make-Whole Premium, "Treasury Yield"
means a rate of interest per annum equal to the weekly average yield to
maturity of United States Treasury Notes that have a constant maturity
that corresponds to the remaining term to maturity of the Securities,
calculated to the nearest 1/12 of a year (the "Remaining Term"). The
Treasury Yield will be determined as of the third Business Day
immediately preceding the applicable Redemption Date. The weekly average
yields of United States Treasury Notes will be determined by reference to
the most recent statistical release published by the Federal Reserve Bank
of New York and designated "H.15(519) Selected Interest Rates" or any
successor release (the "H.15 Statistical Release"). If the H.15
Statistical Release sets forth a weekly average yield for United States
Treasury Notes having a constant maturity that is the same as the
Remaining Term, then Treasury Yield will be equal to such weekly average
yield. In all other cases, the Treasury Yield will be calculated by
interpolation, on a straight-line basis, between the weekly average
yields on the United States Treasury Notes that have a constant maturity
closest to and greater than the Remaining Term and the United States
Treasury Notes that have a constant maturity closest to and less than the
Remaining Term (in each case as set forth in the H.15 Statistical
Release). Any weekly average yields so calculated by interpolation will
be rounded to the nearest 1/100 of 1%, with any figure of 1/200% or above
being rounded upward. If weekly average yields for United States
Treasury Notes are not available in the H.15 Statistical Release or
otherwise, then the Treasury Yield will be calculated by interpolation of
comparable rates selected by the Independent Investment Banker.
Periodic interest installments with respect to which the Interest Payment
Date is on or prior to any Redemption Date will be payable to Holders of
record at the close of business on the relevant record dates referred to
herein, all as provided in the Indenture.
Notice of redemption will be mailed at least 30 days but not more than 60
days before the Redemption Date to each Holder of Securities to be
redeemed at his registered address. Securities in denominations larger
than $1,000 may be redeemed in part but only in whole multiples of
$1,000. On or after the Redemption Date interest will cease to accrue on
Securities or on the portions thereof called for redemption, as the case
may be.
5. Paying Agent and Registrar. Initially, Chase Bank of Texas,
National Association (the "Trustee"), the Trustee under the Indenture,
will act as Paying Agent and Registrar. The Company may change any
Paying Agent, Registrar, co-registrar or additional paying agent without
notice to any Holder. The Company may act in any such capacity.
6. Indenture. The Company issued the Securities under an Indenture
dated as of December 22, 1998 (the "Indenture") among the Company and the
Trustee. The terms of the Securities include those stated in the
Indenture and those made part of the Indenture by reference to the Trust
Indenture Act of 1939, as amended (15 U.S. Code Sections 77aaa-77bbbb),
as in effect on the date of execution of the Indenture. The Securities
are subject to all such terms, and Holders are referred to the Indenture
and such Act for a statement of such terms. The Securities are unsecured
general obligations of the Company.
7. Denominations, Transfer, Exchange. The Securities are in registered
form without coupons in denominations of $1,000 and integral multiples of
$1,000. The transfer of Securities may be registered and Securities may
be exchanged as provided in the Indenture. The Registrar and the Trustee
may require a Holder, among other things, to furnish appropriate
endorsements and transfer documents and to pay any taxes and fees
required by law or permitted by the Indenture. The Registrar need not
exchange or register the transfer of any Securities during the period
between a record date and the corresponding Interest Payment Date.
8. Persons Deemed Owners. The registered Holder of a Security shall be
treated as its owner for all purposes.
9. Amendments and Waivers. Subject to certain exceptions and
limitations, the Indenture or the Securities may be amended or
supplemented with the consent of the Holders of at least a majority in
principal amount of the then outstanding Securities, and any existing
Default under, or compliance with any provision of, the Indenture may be
waived (other than any continuing Default or Event of Default in the
payment of the principal of, or premium, if any, or interest on the
Securities) by the Holders of at least a majority in principal amount of
the Securities then outstanding in accordance with the terms of the
Indenture. Without the consent of any Holder, the Company, any
Guarantors and the Trustee may amend or supplement the Indenture or the
Securities to cure any ambiguity, omission, defect or inconsistency; to
provide for uncertificated Securities in addition to or in place of
certificated Securities; to provide for the assumption of the obligations
of the Company and any Guarantor under the Indenture to Holders in the
case of the merger, consolidation or sale or other disposition of all or
substantially all of the assets of the Company or any Guarantor; to
reflect the release of any Guarantor from its Guarantee to the extent
permitted by the Indenture; to add guarantees to the Securities; to add
to the covenants of the Company or any Guarantors or to surrender any
right of the Company or any Guarantor; to make any change that does not
materially adversely affect the rights of any Holder; or to comply with
the qualification of the Indenture under the Trust Indenture Act of 1939,
as amended.
The right of any Holder to participate in any consent required or sought
pursuant to any provision of the Indenture (and the obligation of the
Company to obtain any such consent otherwise required from such Holder)
may be subject to the requirement that such Holder shall have been the
Holder of record of any Securities with respect to which such consent is
required or sought as of a date identified by the Trustee in a notice
furnished to Holders in accordance with the terms of the Indenture.
Without the consent of each Holder affected, the Company may not (i)
reduce the amount of Securities whose Holders must consent to an
amendment, supplement or waiver, (ii) reduce the rate of or change the
time for payment of interest, including default interest, on any
Security, (iii) reduce the principal of or change the fixed maturity of
any Security or alter the premium or other provisions with respect to
redemption, (iv) make any Security payable in money other than that
stated in the Security, (v) impair the right to institute suit for the
enforcement of any payment of principal of, or premium, if any, or
interest on any Security, (vi) make any change in the percentage of
principal amount of Securities necessary to waive compliance with certain
provisions of the Indenture or (vii) waive a continuing Default or Event
of Default in the payment of principal of, or premium, if any, or
interest on the Securities.
10. Defaults and Remedies. Events of Default include: default in payment
of interest on the Securities for 30 days; default in payment of
principal of, or premium, if any, on the Securities; failure by the
Company or any Guarantor for 60 days after written notice by the Trustee
or by the Holders of at least 25% of the aggregate principal amount of
the Securities then outstanding to it to comply with any of its other
covenants or agreements in the Indenture, the Guarantees or the
Securities; the acceleration of the maturity of any Indebtedness of the
Company or any Subsidiary of the Company (other than the Securities or
any Non-Recourse Indebtedness) that has an outstanding principal amount
of $20 million or more individually or in the aggregate; a default in the
payment of principal or interest in respect of any Indebtedness of the
Company or any Subsidiary of the Company (other than the Securities or
any Non-Recourse Indebtedness) having an outstanding principal amount of
$20 million or more individually or in the aggregate, and such default
shall be continuing for a period of 30 days without the Company or such
Subsidiary, as the case may be, effecting a cure of such default; a final
judgment or order for the payment of money in excess of $20 million (net
of applicable insurance coverage) having been rendered against the
Company, any Guarantor or any other "significant subsidiary" (as such
term is defined in Regulation S-X under the Securities Exchange Act of
1934, as amended; a "Significant Subsidiary") of the Company and such
judgment or order shall continue unsatisfied and unstayed for a period of
60 days; or certain events involving bankruptcy, insolvency or
reorganization of the Company, any Guarantor or any other Significant
Subsidiary of the Company. If an Event of Default occurs and is
continuing, the Trustee or the Holders of at least 25% in principal
amount of the then outstanding Securities may declare the principal of,
and premium, if any, and interest on all the Securities to be immediately
due and payable, except that in the case of an Event of Default arising
from certain events of bankruptcy, insolvency or reorganization of the
Company or any Guarantor, all outstanding Securities become due and
payable immediately without further action or notice. The amount due and
payable upon the acceleration of any Security is equal to 100% of the
principal amount thereof plus premium, if any, and accrued interest to
the date of payment. Holders may not enforce the Indenture or the
Securities except as provided in the Indenture. The Trustee may require
indemnity reasonably satisfactory to it before it enforces the Indenture
or the Securities. Subject to certain limitations, Holders of a majority
in principal amount of the then outstanding Securities may direct the
Trustee in its exercise of any trust or power. The Trustee may withhold
from Holders notice of any continuing default (except a default in
payment of principal or premium, if any, or interest) if it determines
that withholding notice is in their interests. The Company must furnish
an annual compliance certificate to the Trustee.
11. Discharge Prior to Maturity. The Indenture shall be discharged and
canceled upon the payment of all of the Securities and shall be
discharged except for certain obligations upon the irrevocable deposit
with the Trustee of funds or U.S. Government Obligations sufficient for
such payment.
12. Trustee Dealings with Company and Guarantors. The Trustee, in its
individual or any other capacity, may make loans to, accept deposits
from, and perform services for the Company, any Guarantors or their
respective Affiliates, and may otherwise deal with the Company, any
Guarantors or their respective Affiliates, as if it were not Trustee.
13. No Recourse Against Others. A director, officer, employee or
stockholder, as such, of the Company or any Guarantor shall not have any
liability for any obligations of the Company or any Guarantor under the
Securities or the Indenture or for any claim based on, in respect of or
by reason of such obligations or their creation. Each Holder by
accepting a Security waives and releases all such liability. The waiver
and release are part of the consideration for the issuance of the
Securities.
14. Authentication. This Security shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.
15. CUSIP Numbers. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company has
caused CUSIP numbers to be printed on the Securities as a convenience to
the Holders of the Securities. No representation is made as to the
accuracy of such numbers as printed on the Securities and reliance may be
placed only on the other identification numbers printed thereon.
16. Abbreviations. Customary abbreviations may be used in the name of a
Holder or an assignee, such as: TEN COM (= tenants in common), TEN ENT
(= tenants by the entireties), JT TEN (= joint tenants with right of
survivorship and not as tenants in common), CUST (= Custodian), and
U/G/M/A (= Uniform Gifts to Minors Act).
17. Additional Rights of Holders of Transfer Restricted Securities. In
addition to the rights provided to Holders of Securities under the
Indenture, Holders of Transfer Restricted Securities shall have all the
rights set forth in the Registration Rights Agreement, dated as of the
Issue Date (the "Registration Rights Agreement"), among the Company and
the Initial Purchasers.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Request may be made to:
R&B Falcon Corporation
▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇
FORM OF NOTATION ON SECURITY
RELATING TO FUTURE GUARANTEES
Each Guarantor (which term includes any successor Person under the
Indenture), has fully, unconditionally and absolutely guaranteed, to the
extent set forth in the Indenture and subject to the provisions in the
Indenture, the due and punctual payment of the principal of, and premium,
if any, and interest on the Securities and all other amounts due and
payable under the Indenture and the Securities by the Company.
The obligations of the Guarantors to the Holders of Securities and to the
Trustee pursuant to the Guarantees and the Indenture are expressly set
forth in Article IX of the Indenture and reference is hereby made to the
Indenture for the precise terms of the Guarantees.
[NAMES OF GUARANTORS]
By:___________________
ASSIGNMENT FORM
To assign this Security, fill in the form below: (I) or (we) assign and
transfer this Security to _____________________________________________
_______________________________________________________________________
(Insert assignee's social security or tax I.D. number)
_______________________________________________________________________
_______________________________________________________________________
(Print or type assignee's name, address and zip code)
and irrevocably appoint ____________________________________________ as
agent to transfer this Security on the books of the Company. The agent
may substitute another to act for him.
Date: ___________________________
Your Signature:_________________________________________________________
(Sign exactly as your name appears on the face of this Security)
Signature Guarantee:____________________________________________________
(Participant in a Recognized Signature Guaranty Medallion Program)
In connection with any transfer of any of the Securities evidenced by this
certificate occurring prior to the expiration of the period referred to
in Rule 144(k) under the Securities Act after the later of the date of
original issuance of such Securities and the last date, if any, on
which such Securities were owned by the Company or any Affiliate of the
Company, the undersigned confirms that such Securities are being
transferred as specified below:
CHECK ONE
(1) [] to the Company or a Subsidiary thereof; or
(2) [] to a "qualified institutional buyer" (as defined in Rule 144A under
the Securities Act of 1933, as amended) that purchases for its own
account or for the account of a qualified institutional buyer to
whom notice is given that such transfer is being made in reliance
on Rule 144A, in each case pursuant to and in compliance with Rule
144A under the Securities Act of 1933, as amended;
or
(3) [] outside the United States to a "foreign person" in compliance with
Rule 904 of Regulation S under the Securities Act of 1933, as
amended; or
(4) [] pursuant to an effective registration statement under the Securities
Act of 1933, as amended; or
(5) [] pursuant to an exemption from the registration requirements of the
Securities Act of 1933, as amended, provided by Rule 144 thereunder.
and unless the box below is checked, the undersigned confirms that such
Security is not being transferred to an "affiliate" of the Company as
defined in Rule 144 under the Securities Act of 1933, as amended (an
"Affiliate"):
[] The transferee is an Affiliate of the Company.
Unless one of items (1) through (5) above is checked, the Trustee will
refuse to register any of the Securities evidenced by this certificate in
the name of any person other than the registered Holder thereof; provided,
however, that if item (3), or (5) is checked, the Company or the Trustee
may require, prior to registering any such transfer of the Securities, in
their sole discretion, such written legal opinions, certifications
(including an investment letter) and other information as the Trustee or
the Company have reasonably requested to confirm that such transfer is
being made pursuant to an exemption from, or in a transaction not subject
to, the registration requirements of the Securities Act of 1933, as amended.
If none of the foregoing items are checked, the Trustee or Registrar shall
not be obligated to register this Security in the name of any person other
than the Holder hereof unless and until the conditions to any such
transfer of registration set forth herein and in Section 2.06 of the
Indenture shall have been satisfied.
Signed:_________________________________
(Sign exactly as your name appears on the
other side of this Security)
Signature Guarantee:________________________________________
TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED
The undersigned represents and warrants that it is purchasing this Security
for its own account or an account with respect to which it exercises sole
investment discretion and that it and any such account is a "qualified
institutional buyer" within the meaning of Rule 144A under the Securities
Act of 1933, as amended and is aware that the sale to it is being made
in reliance on Rule 144A and acknowledges that it has received such
information regarding the Company as the undersigned has requested
pursuant to Rule 144A or has determined not to request such information
and that it is aware that the transferor is relying upon the undersigned's
foregoing representations in order to claim the exemption from registration
provided by Rule 144A.
Dated:_______________________ ____________________________
Notice: to be executed by an
executive officer]*
SCHEDULE OF EXCHANGES OF SECURITIES*
The following exchanges, redemptions or repurchases of a part of this Global
Security have been made:
Amount of Amount of Principal of Signature of
decrease in increase in Amount Global authorized
Principal Principal Security Officer,
Amount of Amount of following Trustee or
Date of Global Global such decrease Securities
Transaction Security Security (or increase) Custodian
----------- -------- -------- ------------- ---------
*This Schedule should be included only if the Security is a Global
Security.
EXHIBIT C
FORM OF SUPPLEMENTAL INDENTURE
Supplemental Indenture (this "Supplemental Indenture"), dated as of
____________ between ____________________, a __________ corporation (the
"New Guarantor"), a subsidiary of R&B Falcon Corporation, a Delaware
corporation (the "Company"), and [____________________], as trustee under
the indenture referred to below (the "Trustee"). Capitalized terms used
herein and not defined herein shall have the meaning ascribed to them in
the Indenture (as defined below).
W I T N E S S E T H
WHEREAS, the Company has heretofore executed and delivered to the Trustee
an indenture (as amended or supplemented from time to time, the
"Indenture"), dated as of December 22, 1998;
WHEREAS, Section 9.05 of the Indenture provides that under certain
circumstances the Company must cause certain of its subsidiaries to
execute and deliver to the Trustee a supplemental indenture pursuant to
which such subsidiaries shall unconditionally guarantee all of the
Company's obligations under the Securities (as defined in the Indenture)
pursuant to a Guarantee on the terms and conditions set forth herein; and
WHEREAS, pursuant to Section 9.05 of the Indenture, the Trustee is
authorized to execute and deliver this Supplemental Indenture;
NOW, THEREFORE, in consideration of the foregoing and for other good and
valuable consideration, the receipt of which are hereby acknowledged, the
New Guarantor and the Trustee mutually covenant and agree for the equal
and ratable benefit of the Holders of the Securities as follows:
1. Capitalized Terms. Capitalized terms used herein without definition
shall have the meanings ascribed to them in the Indenture.
2. Agreement to Guarantee. The New Guarantor hereby fully,
unconditionally and absolutely guarantees, jointly and severally with all
other Guarantors, the Company's obligations under the Securities and the
Indenture on the terms and subject to the conditions set forth in
Article IX of the Indenture and agrees to be bound by all other
applicable provisions of the Indenture.
3. No Recourse Against Others. No past, present or future director,
officer, employee, incorporator, shareholder or agent of any Guarantor,
as such, shall have any liability for any obligations of the Company or
any Guarantor under the Securities, any Guarantees, the Indenture or this
Supplemental Indenture or for any claim based on, in respect of, or by
reason of, such obligations or their creation. Each Holder by accepting
a Security waives and releases all such liability. The waiver and
release are part of the consideration for issuance of the Securities.
4. New York Law to Govern. The internal law of the State of New York
shall govern and be used to construe this Supplemental Indenture.
5. Counterparts. The parties may sign any number of copies of this
Supplemental Indenture. Each signed copy shall be an original, but all
of them together represent the same agreement.
6. Effect of Headings. The Section headings herein are for convenience
only and shall not affect the construction hereof.
7. The Trustee. The Trustee shall not be responsible in any manner
whatsoever for or in respect of the validity or sufficiency of this
Supplemental Indenture or for or in respect of the correctness of the
recitals of fact contained herein, all of which recitals are made solely
by the New Guarantor.
IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture to be duly executed and attested, all as of the date first
above written.
Dated: __________________ [Name of New Subsidiary Guarantor]
By:________________________
Name:
Title:
Dated: __________________ [_______________________________ ]
as Trustee
By:________________________
Name:
Title:
_______________________________