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UNITED INTERNATIONAL HOLDINGS, INC.
INITIAL ISSUANCE OF $355,000,000
SENIOR DISCOUNT NOTES DUE 2009
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INDENTURE
DATED AS OF APRIL 29, 1999
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FIRSTAR BANK
OF MINNESOTA N.A.
TRUSTEE
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CROSS-REFERENCE TABLE*
TRUST INDENTURE INDENTURE SECTION
ACT SECTION
310(a)(1)........................................................ 7.10
(a)(2)........................................................ 7.10
(a)(3)........................................................ N.A
(a)(4)........................................................ N.A
(a)(5)........................................................ 7.10
(a) ........................................................ 7.10
(c) ........................................................ N.A
311(a) ........................................................ 7.11
(b) ........................................................ 7.11
(c) ........................................................ N.A
312(a) ........................................................ 2.05
(b) ........................................................ 10.03
(c) ........................................................ 10.03
313(a) ........................................................ 7.06
(b)(2)........................................................ 7.07
(c) ........................................................ 7.06;10.02
(d) ........................................................ 7.06
314(A) ........................................................ 4.03;10.02
(c)(1)........................................................ 10.04
(c)(2)........................................................ 10.04
(c)(3)........................................................ N.A
(d) ........................................................ 10.05
(f) ........................................................ N.A
315(a) ........................................................ 7.01
(b) ........................................................ 7.05,10.02
(c) ........................................................ 7.01
(d) ........................................................ 7.01
(e) ........................................................ 6.11
316(a)(LAST SENTENCE)............................................ 2.09
(a)(1)(A)..................................................... 6.05
TRUST INDENTURE INDENTURE SECTION
ACT SECTION
(a)(1)(B)..................................................... 6.04
(a)(2)........................................................ N.A
(b) ........................................................ 6.07
(c) ........................................................ 2.12
317(a)(1)........................................................ 6.08
(a)(2)........................................................ 6.09
(b) ........................................................ 2.04
318(a) ........................................................ 10.01
(b) ........................................................ N.A
(c) ........................................................ 10.01
N.A. MEANS NOT APPLICABLE
*THIS CROSS-REFERENCE TABLE IS NOT PART OF THE INDENTURE.
TABLE OF CONTENTS
PAGE
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ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE........................... 1
Section 1.1 DEFINITIONS.................................... 1
Section 1.2 OTHER DEFINITIONS.............................. 24
Section 1.3 INCORPORATION BY REFERENCE OF TRUST............
INDENTURE ACT.................................. 25
Section 1.4 RULES OF CONSTRUCTION.......................... 25
ARTICLE II
THE SECURITIES....................................................... 26
Section 2.1 FORM AND DATING................................ 26
Section 2.2 EXECUTION AND AUTHENTICATION................... 27
Section 2.3 REGISTRAR AND PAYING AGENT..................... 27
Section 2.4 PAYING AGENT TO HOLD MONEY IN TRUST............ 28
Section 2.5 HOLDER LISTS................................... 29
Section 2.6 TRANSFER AND EXCHANGE.......................... 29
Section 2.7 REPLACEMENT SECURITIES......................... 37
Section 2.8 OUTSTANDING SECURITIES......................... 37
Section 2.9 TREASURY SECURITIES............................ 38
Section 2.10 TEMPORARY SECURITIES........................... 38
Section 2.11 CANCELLATION................................... 38
Section 2.12 RECORD DATE.................................... 39
Section 2.13 CUSIP NUMBER................................... 39
ARTICLE III
REDEMPTION AND REPURCHASE............................................ 40
Section 3.1 OFFER TO REPURCHASE............................ 40
Section 3.2 DEPOSIT OF REPURCHASE PRICE.................... 41
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Section 3.3 DELIVERY OF SECURITIES AND PAYMENT OF
PURCHASE PRICE................................. 42
Section 3.4 SECURITIES REPURCHASED IN PART................. 42
Section 3.5 RIGHT OF REDEMPTION............................ 42
ARTICLE IV
COVENANTS........................................................... 46
Section 4.1 PAYMENT OF SECURITIES.......................... 46
Section 4.2 MAINTENANCE OF OFFICE OR AGENCY................ 46
Section 4.3 REPORTS........................................ 47
Section 4.4 COMPLIANCE CERTIFICATE......................... 47
Section 4.5 TAXES.......................................... 48
Section 4.6 STAY, EXTENSION AND USURY LAWS................. 48
Section 4.7 LIMITATION ON RESTRICTED PAYMENTS.............. 49
Section 4.8 LIMITATION ON DIVIDENDS AND OTHER PAYMENT......
RESTRICTIONS AFFECTING SUBSIDIARIES............ 50
Section 4.9 LIMITATION ON INCURRENCE OF ADDITIONAL IN
DEBTEDNESS AND DISQUALIFIED CAPITAL STOCK ..... 51
Section 4.10 LIMITATION ON SALE OF ASSETS AND SUBSIDIARY....
STOCK. 54
Section 4.11 LIMITATION ON TRANSACTIONS WITH AFFILIATES..... 56
Section 4.12 LIMITATION ON LIENS............................ 57
Section 4.13 LINES OF BUSINESS.............................. 57
Section 4.14 CORPORATE EXISTENCE............................ 58
Section 4.15 LIMITATIONS ON SUBSIDIARY STRUCTURE............ 58
Section 4.16 LIMITATION ON STATUS AS INVESTMENT
COMPANY........................................ 59
Section 4.17 RULE 144A INFORMATION REQUIREMENT.............. 59
Section 4.18 REPURCHASE OF SENIOR NOTES AT THE
OPTION OF THE HOLDER UPON A CHANGE
OF CONTROL..................................... 59
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PAGE
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ARTICLE V
SUCCESSORS........................................................... 60
Section 5.1 LIMITATION ON MERGER, SALE OR
CONSOLIDATION.................................. 60
Section 5.2 SUCCESSOR CORPORATION SUBSTITUTED.............. 60
ARTICLE VI
DEFAULTS AND REMEDIES............................................... 61
Section 6.1 EVENTS OF DEFAULT.............................. 61
Section 6.2 ACCELERATION................................... 63
Section 6.3 OTHER REMEDIES................................. 64
Section 6.4 WAIVER OF PAST DEFAULTS........................ 65
Section 6.5 CONTROL BY MAJORITY............................ 65
Section 6.6 LIMITATION ON SUITS............................ 65
Section 6.7 RIGHTS OF HOLDERS OF SECURITIES TO
RECEIVE PAYMENT................................ 66
Section 6.8 COLLECTION SUIT BY TRUSTEE..................... 66
Section 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM............... 66
Section 6.10 PRIORITIES..................................... 67
Section 6.11 UNDERTAKING FOR COSTS.......................... 68
ARTICLE VII
TRUSTEE............................................................. 68
Section 7.1 DUTIES OF TRUSTEE.............................. 68
Section 7.2 RIGHTS OF TRUSTEE.............................. 70
Section 7.3 INDIVIDUAL RIGHTS OF TRUSTEE................... 70
Section 7.4 TRUSTEE'S DISCLAIMER........................... 71
Section 7.5 NOTICE OF DEFAULTS............................. 71
Section 7.6 REPORTS BY TRUSTEE TO HOLDERS OF
THE SECURITIES................................. 71
Section 7.7 COMPENSATION AND INDEMNITY..................... 72
iii
PAGE
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Section 7.8 REPLACEMENT OF TRUSTEE......................... 73
Section 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC............... 74
Section 7.10 ELIGIBILITY; DISQUALIFICATION.................. 74
Section 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST
COMPANY........................................ 75
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE............................. 75
Section 8.1 OPTION TO EFFECT LEGAL DEFEASANCE OR
COVENANT DEFEASANCE............................ 75
Section 8.2 LEGAL DEFEASANCE AND DISCHARGE................. 75
Section 8.3 COVENANT DEFEASANCE............................ 76
Section 8.4 CONDITIONS TO LEGAL OR COVENANT
DEFEASANCE..................................... 76
Section 8.5 DEPOSITED MONEY AND GOVERNMENT
SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS................. 78
Section 8.6 REPAYMENT TO COMPANY........................... 79
Section 8.7 REINSTATEMENT.................................. 79
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER.................................... 79
Section 9.1 WITHOUT CONSENT OF HOLDERS
OF SECURITIES.................................. 79
Section 9.2 WITH CONSENT OF HOLDERS OF SECURITIES.......... 80
Section 9.3 COMPLIANCE WITH TRUST INDENTURE ACT............ 82
Section 9.4 REVOCATION AND EFFECT OF CONSENTS.............. 82
Section 9.5 NOTATION ON OR EXCHANGE OF SECURITIES.......... 83
Section 9.6 TRUSTEE TO SIGN AMENDMENTS, ETC................ 83
iv
ARTICLE X
MICELLANEOUS 88
Section 10.1 TRUST INDENTURE ACT CONTROLS................... 88
Section 10.2 NOTICES........................................ 88
Section 10.3 COMMUNICATION BY HOLDERS OF SECURITIES
WITH OTHER HOLDERS OF SECURITIES.............. 89
Section 10.4 CERTIFICATE AND OPINION AS TO
CONDITIONS PRECEDENT........................... 89
Section 10.5 STATEMENTS REQUIRED IN CERTIFICATE
OR OPINION..................................... 90
Section 10.6 RULES BY TRUSTEE AND AGENTS.................... 90
Section 10.7 NO PERSONAL LIABILITY OF DIRECTORS,
OFFICERS, EMPLOYEES AND STOCKHOLDERS.......... 90
Section 10.8 GOVERNING LAW.................................. 91
Section 10.9 NO ADVERSE INTERPRETATION OF
OTHER AGREEMENTS............................... 91
Section 10.10 SUCCESSORS..................................... 91
Section 10.11 SEVERABILITY................................... 91
Section 10.12 COUNTERPART ORIGINALS.......................... 91
Section 10.13 HEADINGS, ETC.................................. 91
Section 10.14 REGISTRATION RIGHTS............................ 92
EXHIBITS
EXHIBIT A FORM OF SENIOR NOTE............................ A-1
1
INDENTURE dated as of April 29, 1999 by and between United
International Holdings, Inc., a Delaware corporation (the "Company"), and
Firstar Bank of Minnesota, N.A., as trustee (the
"Trustee").
The Company and the Trustee agree as follows for the benefit of each
other and for the equal and ratable benefit of the Holders of the Series A
Senior Discount Notes due 2009 and the class of Series B Senior Discount Notes
due 2009 to be exchanged for the Series A Senior Discount Notes due 2009 being
issued by the Company.
ARTICLE I
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.1 DEFINITIONS.
"Accreted Value" means, as of any date of determination, the sum
(rounded to the nearest whole dollar) of (a) the initial offering price of each
$1,000 in principal amount at maturity of Senior Notes and (b) the portion of
the excess of the principal amount of Senior Notes over such initial offering
price which shall have been accreted thereon through such date, such amount to
be so accreted on a daily basis at the Accretion Rate, compounded semi-annually
on each May 1 and November 1 from the date of issuance of the Senior Notes
through the date of determination.
"Accretion Rate" is as specified in paragraph 1 of the form of note
attached as Exhibit A.
"Acquired Indebtedness" means Indebtedness or Disqualified Capital
Stock of any Person existing at the time such Person becomes a Subsidiary or
Restricted Affiliate of the Company, including by designation, or is merged or
consolidated into or with the Company or one of its Subsidiaries or Restricted
Affiliates.
"Acquisition" means the purchase or other acquisition of any Person of
all or substantially all the assets or any Person by any other Person, whether
by purchase, merger, consolidation, or other transfer, and whether or not for
consideration.
"Affiliate" means any Person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company. For
purposes of this definition, "control" means the power to direct the management
and policies of a Person, directly or through one or more intermediaries,
2
whether through the ownership of voting securities, by contract, or otherwise,
provided that, with respect to ownership interest in the Company and its
Subsidiaries, a Beneficial Owner of 10% or more of the total voting power
normally entitled to vote in the election of directors, managers or trustees, as
applicable, shall for such purposes be deemed to constitute control.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Annualized Consolidated EBITDA" means Consolidated EBITDA
multiplied by two.
"Average Life" means, as of the date of determination, with respect to
any security or instrument, the quotient obtained by dividing (i) the sum of the
products (a) of the number of years from the date of determination to the date
or dates of each successive scheduled principal (or redemption) payment of such
security or instrument and (b) the amount of each such respective principal (or
redemption) payment by (ii) the sum of all such principal (or redemption)
payments.
"Bankruptcy Law" means Title 11, U.S. Code or any similar
Federal or state law for the relief of debtors.
"Beneficial Owner" or "beneficial owner" for purposes of the definition
of Change of Control and Affiliate has the meaning attributed to it in Rules
13d-3 and 13d-5 under the Exchange Act (as in effect on the Issue Date), whether
or not applicable, except that a "person" shall be deemed to have "beneficial
ownership" of all shares that any such Person has the right to acquire, whether
such right is exercisable immediately or only after the passage of time.
"Board of Directors" or "Board" means, with respect to any Person, the
board of directors of such Person or any committee of the Board of Directors of
such Person authorized, with respect to any particular matter, to exercise the
power of the board of directors of such Person.
"Board Resolution" means a copy of a resolution certified by the
Secretary or an Assistant Secretary of the Company to have been duly adopted by
the Board of Directors and to be in full force and effect on the date of such
certification, and delivered to the Trustee.
3
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in New York, New York
are authorized or obligated by law or executive order to close.
"Capitalized Lease Obligation" means, as to any Person, the obligations
of such Person under a lease that are required to be classified and accounted
for as capital lease obligations under GAAP and, for purposes of this
definition, the amount of such obligations at any date shall be the capitalized
amount of such obligations at such date, determined in accordance with GAAP.
"Capital Stock" means, with respect to any corporation, any and all
shares, interests, rights to purchase (other than convertible or exchangeable
Indebtedness that is not itself otherwise capital stock), warrants, options,
participation or other equivalents of or interests (however designated) in stock
issued by that corporation.
"Cash Equivalent" means (i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (ii) time deposits and
certificates of deposit and commercial paper issued by the parent corporation of
any domestic commercial bank of recognized standing having capital and surplus
in excess of $500 million, (iii) commercial paper issued by others rated at
least A-2 or the equivalent thereof by Standard & Poor's Corporation or at least
P-2 or the equivalent thereof by ▇▇▇▇▇'▇ Investors Service, Inc., and in the
case of each of (i), (ii) and (iii) maturing within one year after the date of
acquisition, and (iv) Eurodollar time deposits with maturities of six months or
less from the date of acquisition, bankers' acceptances with maturities not
exceeding six months and overnight bank deposits, in each case with any domestic
commercial bank having capital and surplus in excess of $500 million and a ▇▇▇▇▇
Bank Watch Rating of "B" or better, provided that with respect to any
Non-Domestic Person, Cash Equivalents shall also mean those investments that are
comparable to clauses (ii) and (iv) above in such Person's country of
organization or country where it conducts business operations.
"Change of Control" means (i) any merger or consolidation of the
Company with or into any Person or any sale, transfer or other conveyance,
whether direct or indirect, of all or substantially all of the assets of the
Company, on a consolidated basis, in one transaction or a series of related
transactions, if, immediately after giving effect to such transaction(s), any
"person" or "group" (as such terms are used for purposes of Section 13(d) and
14(d) of the Exchange Act, whether or not applicable) other than the Principals
or their Related Parties or a group that is controlled by one or more of the
Principals, is or becomes the "beneficial owner," directly or indirectly, of
more than 50% of the total voting power in the aggregate normally entitled to
vote in the election of directors, managers, or trustees, as applicable, of the
transferee(s) or surviving entity or entities, (ii) other than the Principals or
their Related Parties or a group that is controlled by one or more of the
Principals, any "person" or "group" (as such terms are used for purposes of
Sections 13(d) and 14(d) of the Exchange Act, whether or not applicable), is or
4
becomes the "beneficial owner," directly or indirectly, of more than 50% of the
total voting power in the aggregate of all classes of Capital Stock of the
Company then outstanding normally entitled to vote in the election of directors,
or (iii) during any period of 12 consecutive months after the Issue Date,
individuals who at the beginning of any such 12-month period constituted the
Board of Directors of the Company (together with any new directors whose
election by such Board of Directors or whose nomination for election by the
shareholders of the Company was approved by a vote of a majority of the
directors then still in office who were either directors at the beginning of
such period or whose election or nomination for election was previously so
approved) cease for any reason to constitute a majority of the Board of
Directors of the Company then in office. A Person will not be deemed to be a
member of a "group" for purposes of this definition solely by virtue of becoming
party to an agreement with one or more Principals or their Related Parties that
requires such Person to vote the voting stock of the Company in a manner
specified by the Principals or their Related Parties.
"Company" means United International Holdings, Inc., a Delaware
corporation.
"Consolidated Cash Flow Ratio" of any Person on any date of
determination (the "Transaction Date") means the ratio, on a pro forma basis, of
(a) Consolidated Debt of such Person on the Transaction Date to (b) the
aggregate amount of Annualized Consolidated EBITDA of such Person attributable
to continuing operations and businesses (exclusive of amounts attributable to
operations and businesses permanently discontinued or disposed of) for the
Reference Period; provided that for purposes of such calculation, (i)
Acquisitions which occurred during the Reference Period or subsequent to the
Reference Period and on or prior to the Transaction Date shall be assumed to
have occurred on the first day of the Reference Period, (ii) transactions giving
rise to the need to calculate the Consolidated Cash Flow Ratio shall be assumed
to have occurred on the first day of the Reference Period and (iii) the
incurrence of any Indebtedness or issuance of any Disqualified Capital Stock
during the Reference Period or subsequent to the Reference Period and on or
5
prior to the Transaction Date (and the application of the proceeds therefrom to
the extent used to refinance or retire other Indebtedness) shall be assumed to
have occurred on the first day of the Reference Period.
"Consolidated Coverage Ratio" of any Person on any date of
determination (the "Transaction Date") means the ratio, on a pro forma basis, of
(a) the aggregate amount of Consolidated EBITDA of such Person attributable to
continuing operations and businesses (exclusive of amounts attributable to
operations and business permanently discontinued or disposed of) for the
Reference Period to (b) the aggregate Consolidated Fixed Charges of such Person
(exclusive of amounts attributable to operations and businesses permanently
discontinued or disposed of, but only to the extent that the obligations giving
rise to such Consolidated Fixed Charges would no longer be obligations
contributing to such Person's Consolidated Fixed Charges subsequent to the
Transaction Date) during the Reference Period; provided that for purposes of
such calculation, (i) Acquisitions which occurred during the Reference Period or
subsequent to the Reference Period and on or prior to the Transaction Date shall
be assumed to have occurred on the first day of the Reference Period, (ii)
transactions giving rise to the need to calculate the Consolidated Coverage
Ratio shall be assumed to have occurred on the first day of the Reference
Period, (iii) the incurrence of any Indebtedness or issuance of any Disqualified
Capital Stock during the Reference Period or subsequent to the Reference Period
and on or prior to the Transaction Date (and the application of the proceeds
therefrom to the extent used to refinance or retire other Indebtedness) shall be
assumed to have occurred on the first day of such Reference Period, and (iv) the
Consolidated Fixed Charges of such Person attributable to interest on any
Indebtedness or dividends on any Disqualified Capital Stock bearing a floating
interest (or dividend) rate shall be computed on a pro forma basis as if the
average rate in effect from the beginning of the Reference Period to the
Transaction Date had been the applicable rate for the entire period, unless such
person or any of its Subsidiaries is a paty to an Interest Swap or Hedging
Obligation (which shall remain in effect for the 12-month period immediately
following the Transaction Date) that has the effect of fixing the interest rate
on the date of computation, in which case such rate (whether higher or lower)
shall be used.
"Consolidated Debt" means, with respect to any Person as of any date of
determination, the aggregate amount of Indebtedness and Disqualified Capital
Stock of such Person and its Subsidiaries outstanding as of such date of
determination, determined on a consolidated basis in accordance with GAAP.
"Consolidated EBITDA" means, with respect to any Person, for any
period, the Consolidated Net Income of such Person for such period adjusted to
add thereto (to the extent deducted from net revenues in determining
Consolidated Net Income), without duplication, the sum of (i) Consolidated
6
income tax expense, (ii) Consolidated depreciation and amortization expense, and
(iii) Consolidated Fixed Charges, less the amount of all cash payments made by
such Person or any of its Subsidiaries during such period to the extent such
payments relate to non-cash charges that were added back in determining
Consolidated EBITDA for such period or any prior period.
"Consolidated Fixed Charges" of any Person means, for any period, the
aggregate amount (without duplication and determined in each case in accordance
with GAAP) of (a) interest expensed or capitalized, paid, accrued, or scheduled
to be paid or accrued (including, in accordance with the following sentence,
interest attributable to Capitalized Lease Obligations) of such Person and its
Consolidated Subsidiaries during such period, including (i) original issue
discount and non-cash interest payments or accruals on any Indebtedness, (ii)
the interest portion of all deferred payment obligations, and (iii) all
commissions, discounts and other fees and charges owed with respect to bankers'
acceptances and letters of credit financings and currency and Interest Swap and
Hedging Obligations, in each case to the extent attributable to such period and
(b) the amount of dividends accrued or payable (or guaranteed) by such Person or
any of its Consolidated Subsidiaries in respect of preferred stock (other than
by Subsidiaries of such Person to such Person or such Person's Wholly Owned
Subsidiaries). For purposes of this definition, (x) interest on a Capitalized
Lease Obligation shall be deemed to accrue at an interest rate reasonably
determined in good faith by the Company to be the rate of interest implicit in
such Capitalized Lease Obligation in accordance with GAAP and (y) interest
expense attributable to any Indebtedness represented by the guaranty by such
Person or a Subsidiary of such Person of an obligation of another Person shall
be deemed to be the interest expense attributable to the Indebtedness
guaranteed.
"Consolidated Invested Equity Capital" means, with respect to any
Person as of any date, the sum of the Invested Equity Capital of such Person as
of such date and, without duplication, the Invested Equity Capital of each of
its Subsidiaries and Restricted Affiliates as of such date. For purposes of
calculating the Consolidated Invested Equity Capital of any Person as of any
date, in order to avoid duplication, the Invested Equity Capital of a Subsidiary
or Restricted Affiliate of such Person shall not include any amounts that would
be included in the Consolidated Invested Equity Capital of any equity owner of
such Subsidiary or Restricted Affiliate, to the extent that such amounts were
utilized by such equity owner prior to such date to permit the incurrence of
Indebtedness pursuant to clause (ii)(3) of the first paragraph of Section 4.9
hereof. For example, if a direct Subsidiary of the Company has Consolidated
Invested Equity Capital of $100 and incurs $225 of such Indebtedness, then a
7
direct or indirect Subsidiary (or a Restricted Affiliate) of such Subsidiary
will not be deemed to have any Invested Equity Capital based on contributions or
loans to it by such first Subsidiary. In addition, the Invested Equity Capital
of a Subsidiary or Restricted Affiliate of a Person will never be considered to
be greater than the Invested Equity Capital of such Person, except as a result
of contributions of Invested Equity Capital to such Subsidiary or Restricted
Affiliate by third parties.
"Consolidated Net Income" means, with respect to any Person for any
period, the net income (or loss) of such Person and its Consolidated
Subsidiaries (determined on a consolidated basis in accordance with GAAP) for
such period, adjusted to exclude (only to the extent included in computing such
net income (or loss) and without duplication): (a) all gains (but not losses)
which are either extraordinary (as determined in accordance with GAAP) or are
nonrecurring (including any gain from the sale or other disposition of assets
outside the ordinary course of business or from the issuance or sale of any
capital stock), (b) the net income, if positive, of any Person, other than a
Consolidated Subsidiary, in which such Person or any of its Consolidated
Subsidiaries has an interest, except to the extent of the amount of any
dividends or distributions actually paid in cash to such Person or a
Consolidated Subsidiary of such Person during such period, but in any case not
in excess of such Person's pro rata share of such Person's net income for such
period, (c) the net income or loss of any Person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition, (d)
the net income, if positive, of any of such Person's Consolidated Subsidiaries
to the extent that the declaration or payment of dividends or similar
distributions is not at the time permitted by operation of the terms of its
charter or bylaws or any other agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such Consolidated
Subsidiary other than the Indenture.
"Consolidated Subsidiary" means, for any Person, each Subsidiary of
such Person (whether now existing or hereafter created or acquired) the
financial statements of which are consolidated for financial statement reporting
purposes with the financial statements of such Person in accordance with GAAP.
"Consolidation" means, with respect to any Person, the consolidation of
the accounts of the Subsidiaries of such Person with those of such Person, all
in accordance with GAAP; provided that "consolidation" will not include
consolidation of the accounts of any other Person other than a Subsidiary of
such Person with such Person. The terms "Consolidate" or "Consolidated" have a
correlative meaning to the foregoing.
8
"Corporate Trust Officer of the Trustee" shall be at the address of the
Trustee specified in Section 10.2 hereof or such other address as to which the
Trustee may give notice to the Company.
"Custodian" means any receiver, trustee, assignee, liquidator or
similar official under any Bankruptcy Law.
"Default" means any event that is or with the passage of time or the
giving of notice or both would be an Event of Default.
"Definitive Securities" means Securities that are in the form of
Security attached hereto as Exhibit A that do not include the information called
for by footnotes 3 and 6 thereof.
"Depositary" means, with respect to the Securities issuable or issued
in whole or in part in global form, the person specified in Section 2.3 as the
Depositary with respect to the Securities, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depositary" shall mean or include such successor.
"Disqualified Capital Stock" means (a) except as set forth in (b), with
respect to any Person, Equity Interests of such Person that, by its terms or by
the terms of any security into which it is convertible, exercisable or
exchangeable, is, or upon the happening of an event or the passage of time or
both would be, required to be redeemed or repurchased (including at the option
of the holder thereof) by such Person or any of its Subsidiaries, in whole or in
part, on or prior to 91 days following the Stated Maturity of the Senior Notes
and (b) with respect to any Subsidiary or Restricted Affiliate of the Company,
any Equity Interests of such Subsidiary or Restricted Affiliate other than (i)
any common equity with no preference, privileges, or redemption or repayment
provisions or (ii) preferred stock convertible into such common equity of such
Subsidiary or Restricted Affiliate with no payment of dividends or liquidation
preference due or payable thereon on or prior to 91 days following the Stated
Maturity of the Senior Notes and the proceeds of which are used directly or
indirectly in the business of such Subsidiary or Restricted Affiliate.
"DLJSC" means ▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Securities
Corporation.
"Equity Interest" of any Person means any shares, interests,
participation or other equivalents (however designated) in such Person's equity,
9
and shall in any event include any Capital Stock issued by, or partnership or
membership interests in, such Person.
"Event of Loss" means, with respect to any property or asset, any (i)
loss, destruction or damage of such property or asset or (ii) any condemnation,
seizure or taking, by exercise of the power of eminent domain or otherwise, of
such property or asset, or confiscation or requisition of the use of such
property or asset.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Exchange Securities" means the Series B Senior Discount Notes due
2009, as supplemented from time to time in accordance with the terms hereof, to
be issued pursuant to this Indenture in connection with the offer to exchange
Securities for the Initial Securities that may be made by the Company pursuant
to the Registration Rights Agreement that contain the information referred to in
footnotes 1, 2 and 8 to the form of Security attached hereto as Exhibit A.
"Exempted Affiliate Transaction" means (i) Restricted Payments
comprised of pro rata dividends paid in cash on any class of Capital Stock and
made in compli ance with the Indenture, (ii) transactions, at arms-length and as
so set forth in a Board Resolution, between or among holders of any Equity
Interest of any Subsidiary of the Company and such Subsidiary, so long as such
holder is not otherwise an Affiliate of the Company, (iii) transactions between
or among the Company, and its Subsidiaries and Restricted Affiliates, and (iv)
the Company or any of its Subsidiaries entering into or performing any
employment agreement, stock option agreement or other agreement relating to the
terms of employment, or compensation, or termination of employment in the
ordinary course of business and consistent with the past practice of the Company
or such Subsidiary.
"Existing Agreements" means (i) any and all instruments, as in effect
on the Issue Date, between the Company or any of its Subsidiaries or Restricted
Affiliates and a commercial lending institution or institutions, which makes
borrowing of funds available to the Company or any such Subsidiary or Restricted
Affiliate from such institution or institutions and (ii) any replacements of the
instruments in clause (i) entered into by the respective Subsidiary or
Restricted Affiliate that was party to the instrument so replaced or their
respective successors and a commercial lending institution or institutions for
an amount up to the maximum amount of the instrument so replaced.
10
"Existing Note Indentures" means the indenture dated November 23, 1994
between the Company and the Trustee, the indenture dated November 22, 1995
between the Company and the Trustee and the indenture dated February 5, 1998
between the Company and the Trustee, each as amended through the Issue Date,
pursuant to which the Existing Notes were issued.
"Existing Notes" means the 14% Senior Secured Discount Notes due 1999
and the 10 3/4% Senior Secured Discount Notes due 2008 issued by the Company
pursuant to the Existing Note Indentures.
"Fair Market Value" means, with respect to any asset or property, the
price which would be negotiated in an arm's-length, free market transaction, for
cash, between a willing seller and a willing and able buyer, neither of whom is
under undue pressure or compulsion to complete the transaction.
"GAAP" means generally accepted accounting principles 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 have been approved by a significant segment of the accounting
profession in the United States, which are in effect on the Issue Date.
"Global Security" means a Security that contains the information
referred to in footnotes 3 and 6 to the form of Security attached hereto as
Exhibit A.
"Government Securities" means securities that are (a) direct
obligations of the United States of America for the timely payment of which its
full faith and credit is pledged or (b) obligations of a person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the timely payment of which is unconditionally guaranteed as a full
faith and credit obligation by the United States of America, which, in either
case, are not callable or redeemable at the option of the issuer thereof, and
shall also include a depository receipt issued by a bank (as defined in Section
3(a)(2) of the Securities Act of 1933, as amended), as custodian with respect to
any such Government Security or a specific payment of principal of or interest
on any such Government Security held by such custodian for the account of the
holder of such depository receipt, provided that (except as required by law)
such custodian is not authorized to make any deduction from the amount payable
to the holder of such depository receipt from any amount received by the
custodian in respect of the Government Security or the specific payment of
principal of or interest on the Government Security evidenced by such depository
receipt.
11
"Guarantee" means a guarantee (other than by endorsement of negotiable
instruments for collection in the ordinary course of business), direct or
indirect, in any manner (including, without limitation, letters of credit and
reimbursement agreements in respect thereof), of all or any part of any
Indebtedness. The amount of any Guarantee shall be equal to the maximum
potential liability in respect of the Guarantee, even if less than the
Indebtedness supported by such Guarantee.
"Holder" means a Person in whose name a Security is registered.
"Indebtedness" of any Person means, without duplication, (a) all
liabilities and obligations, contingent or otherwise, of such Person, to the
extent such liabilities and obligations would appear as a liability upon the
consolidated balance sheet of such Person in accordance with GAAP, (i) in
respect of 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) evidenced
by bonds, notes, debentures or similar instruments, (iii) representing the
balance deferred and unpaid of the purchase price of any property or services,
except (other than accounts payable or other obligations to trade creditors
which have remained unpaid for greater than 60 days past their original due
date) those incurred in the ordinary course of its business that would
constitute ordinarily a trade payable to trade creditor; (b) all liabilities and
obligations, contingent or otherwise, of such Persons (iv) evidenced by bankers'
acceptances or similar instruments issued or accepted by banks, (v) relating to
any Capitalized Lease Obligation, or (vi) evidenced by a letter of credit or a
reimbursement obligation of such Person with respect to any letter of credit
(other than obligations with respect to letters of credit securing obligations
(other than obligations described in (i) through (iii) above) entered into in
the ordinary course of business of such Person to the extent such letters of
credit are not drawn upon); (c) all net obligations of such Person under
Interest Swap and Hedging Obligations; (d) all liabilities and obligations of
others of the kind described in the preceding clause (a), (b) or (c) that such
Person has guaranteed or that is otherwise its legal liability or which are
secured by any assets or property of such Person; (e) any and all deferrals,
renewals, extensions, refinancing and refundings (whether direct or indirect)
of, or amendments, modifications or supplements to, any liability of the kind
described in any of the preceding clauses (a), b), (c) or (d), or this clause
(e), whether or not between or among the same parties; and (f) all Disqualified
Capital Stock of such Person (measured at the greater of its voluntary or
involuntary maximum fixed repurchase price plus accrued and unpaid dividends).
For purposes hereof, the "maximum fixed repurchase price" of any Disqualified
Capital Stock which does not have a fixed repurchase price shall be calculated
in accordance with the terms of such Disqualified Capital Stock as if such
12
Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to the Indenture, and if such price
is based upon, or measured by, the Fair Market Value of such Disqualified
Capital Stock, such Fair Market Value to be determined in good faith by the
Board of Directors of the Company. The accrual of interest and the accretion of
accreted value shall not be deemed to be an incurrence of Indebtedness on debt
issued with original issue discount and in accordance with its original terms
when issued.
"Indenture" means this Indenture, as amended or supplemented from time
to time.
"Initial Securities" means the Series A Senior Discount Notes due 2009,
as supplemented from time to time in accordance with the terms hereof, issued
under this Indenture that contain the information referred to in footnotes 4, 5
and 7 to the form of Security attached hereto as Exhibit A.
"Interest Payment Date" means the stated due date of an installment of
interest on the Securities.
"Initial Purchasers" means the Purchasers as defined in the Note
Purchase Agreement.
"Interest Swap and Hedging Obligation" means any obligation of any
Person pursuant to any interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate exchange agreement,
currency exchange agreement or any other agreement or arrangement designed to
protect against fluctuations in interest rates or currency values, including,
without limitation, any arrangement whereby, directly or indirectly, such Person
is entitled to receive from time to time periodic payments calculated by
applying either a fixed or floating rate of interest on a stated notional amount
in exchange for periodic payments made by such Person calculated by applying a
fixed or floating rate of interest on the same notional amount.
"Invested Equity Capital" means, with respect to any Person as of any
date, without duplication, the sum of (i) the total dollar amount contributed in
cash plus the value of all property contributed (valued at Fair Market Value at
the time of contribution, determined in good faith by the Board of Directors) to
such Person since the date of its creation in the form of common equity, plus,
(ii) the total dollar amount contributed in cash plus the value of all property
contributed (valued at Fair Market Value at the time of contribution, determined
in good faith by the Board of Directors) to such Person since the date of
creation by the holders of its common equity (and their Affiliates) in
consideration of the issuance of preferred equity or Indebtedness, on a basis
that is substantially proportionate to their common equity interests (with any
disproportionately large equity interests received by the Company, a Restricted
Affiliate, or a Subsidiary relative to their respective contributions being
ignored for this purpose), plus, (iii) the total dollar amount contributed in
cash plus the value of all property contributed (valued at Fair Market Value at
the time of contribution, determined in good faith by the Board of Directors) to
such Person since the date of its creation by the Company or a Wholly Owned
Subsidiary of the Company in consideration of the issuance of preferred equity
or Indebtedness, less (iv) the value of all interest, returns in respect of
Indebtedness, dividends and other distributions (in whatever form and however
designated, valued at Fair Market Value as determined in good faith by the Board
of Directors) made by such Person since the date of its creation to the holders
of its common equity (and their Affiliates); pro vided that in no event shall
13
the aggregate amount of interest, dividends and other distributions made to any
holder of common equity of a Person (or its Affiliates) operate to reduce the
Invested Equity Capital of such Person by more than the total contributions to
such Person (per clauses (i) through (iii) above) by such equity holder (and its
Affiliates), and less (v) the total amount of Investments (measured as of the
date made but without giving effect to any proration) made by such Person
pursuant to clause (e) of the definition of Permitted Investments since the date
of the Indenture that are outstanding as of such date.
"Investment" by any Person in any other Person means (without
duplication)(a) the acquisition (whether by purchaser, merger, consolidation or
otherwise) by such Person (whether for cash, property, services, securities or
otherwise) of capital stock, bonds, notes, debentures, partnership or other
ownership interests or other securities, including any options or warrants, of
such other Person or any agreement to make any such acquisition; (b) the making
by such Person of any deposit with, or advance, loan or other extension of
credit to, such other Person (including the purchase of property from another
Person subject to an understanding or agreement, contingent or otherwise, to
resell such property to such other Person) or any commitment to make any such
advance, loan or extension (but excluding accounts receivable, endorsements for
collection or deposits arising in the ordinary course of business); (c) other
than guarantees of Indebtedness of the Company or any Subsidiary to the extent
permitted by Section 4.9 or the definition of Permitted Indebtedness the
entering into by such Person of any guarantee of, or other credit support or
contingent obligation with respect to, Indebtedness or other liability of such
other Person; (d) the making of any capital contribution by such Person to such
other Person; and (e) the designation by the Board of Directors of the Company
of any Person to be an Unrestricted Subsidiary or no longer to be a Restricted
14
Affiliate (and not thence to be a Subsidiary). The Company shall be deemed to
make an Investment in an amount equal to the Fair Market Value of its Pro Rata
Share of any Subsidiary or Restricted Affiliate (or, if neither the Company nor
any of its Subsidiaries has therefore made an Investment in such subsidiary of
affiliate, in an amount equal to its Pro Rata Share of the Investments being
made), at the time that such Subsidiary or Restricted Affiliate is designated an
Unrestricted Subsidiary or no longer to be a Restricted Affiliate (and not
thence to be a Subsidiary) andany property transferred to an Unrestricted
Subsidiary or such other Person from the Company and the Company's Pro Rata
Share of the property transferred by a Subsidiary or Restricted Affiliate of the
Company to such Person shall be deemed an Investment valued at its Fair Market
Value at the time of such transfer.
"Issue Date" means the date of first issuance of the Senior Notes under
the Indenture.
"Legal Holiday" means a Saturday, a Sunday or a day on which banking
institutions in the City of New York or at a place of payment are authorized by
law, regulation or executive order to remain closed. 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.
"Lien" means any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, hypothecation or other encumbrance
upon or with respect to any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired.
"Liquidated Damages" shall have the meaning set forth in the
Registration Rights Agreement.
"Market Spread Date" shall have the meaning set forth in Exhibit A.
"Net Cash Proceeds" means the aggregate amount of Cash or Cash
Equivalents received by the Company in the case of a sale of Qualified Capital
Stock and by the Company and its Subsidiaries in respect of an Asset Sale plus,
in the case of an issuance of Qualified Capital Stock upon any exercise,
exchange or conversion of securities (including options, warrants, rights and
convertible or exchangeable debt) of the Company that were issued for cash on or
after the Issue Date, the amount of cash originally received by the Company upon
the issuance of such securities (including options, warrants, rights and
convertible or exchangeable debt) less, in each case, the sum of all payments,
fees, commissions and (in the case of Asset Sales, reasonable and customary)
expenses (including, without limitation, the fees and expenses of legal counsel
15
and investment banking fees and expenses) incurred in connection with such Asset
Sale or sale of Qualified Capital Stock, and, in the case of an Asset Sale only,
less the amount (estimated reasonably and in good faith by the Company) of
income, franchise, sales and other applicable taxes required to be paid by the
Company or any of its respective Subsidiaries in connection with such Asset
Sale.
"Non-Domestic Person" means any direct or indirect Subsidiary or
Restricted Affiliate of the Company that is organized under the laws of any
jurisdiction, or has its principal business operations outside of the United
States of America and Puerto Rico.
"Note Purchase Agreement" means the note purchase agreement dated the
date hereof between the Company, DLJSC and the Purchasers.
"Obligations" means any principal, Accreted Value, Liquidated Damages,
interest, penalties, fees, indemnifications, reimbursements, damages and other
liabilities payable under the documentation governing any Indebtedness.
"Offering Memorandum" means the initial offering memorandum of the
Company, dated April 29, 1999, relating to the offer and sale of the Initial
Securities in a transaction exempt from the requirements of Section 5 of the
Securities Act.
"Officer" means, with respect to any Person, the Chairman of the Board,
the Chief Executive Officer, the President, the Chief Operating Officer, the
Chief Financial Officer, the Treasurer, any Assistant Treasurer, the Controller,
the Secretary or any Vice- President of such Person.
"Officers' Certificate" means a certificate signed on behalf of the
Company by two Officers of the Company, one of whom must be the principal
executive officer, the principal financial officer, the treasurer or the
principal accounting officer of the Company, that meets the requirements of
Section 10.5 hereof.
"Opinion of Counsel" means an opinion from legal counsel who is
reasonably acceptable to the Trustee, that meets the requirements of Section
10.5 hereof. The counsel may be an employee of or counsel to the Company, any
Subsidiary of the Company or the Trustee.
"Permitted Indebtedness" means any of the following:
16
(a) that the Company may incur Indebtedness whose terms are governed by
the Indenture up to the amounts issued thereunder as of the Issue Date;
(b) that the Company and the Subsidiaries and Restricted Affiliates, as
applicable, may incur Refinancing Indebtedness with respect to any indebtedness
or Disqualified Capital Stock, as applicable, described in clause (a) of this
definition, incurred pursuant to the second sentence or clauses (b) or (c) of
Section 4.9 or which is outstanding on the Issue Date;
(c) the Company and the Subsidiaries and Restricted Affiliates may
incur Indebtedness solely in respect of bankers acceptances, letters of credit
and performance bonds (to the extent that such incurrence does not result in the
incurrence of any obligation to repay any obligation relating to borrowed money
of others), all in the ordinary course of business in accordance with customary
industry practices, in amounts and for the purposes customary in the Company's
industry;
(d) the Company may incur Indebtedness to any Subsidiary or Restricted
Affiliate and any Subsidiary or Restricted Affiliate of the Company may incur
Indebtedness to any other Subsidiary or Restricted Affiliate of the Company, or
to the Company; provided that, in the case of Indebtedness of the Company, such
obligations shall be unsecured and subordinated in all respects to the Company's
obligations pursuant to the Senior Notes and the date of any event that causes
such Subsidiary or Restricted Affiliate no longer to be a Subsidiary or
Restricted Affiliate shall be an Incurrence Date;
(e) issuances of preferred stock or Indebtedness by a Subsidiary or a
Restricted Affiliate of the Company to the holders (or their Affiliates) of the
common equity of such Subsidiary or Restricted Affiliate on a basis that is
substantially proportionate to their common equity interests (with any
disproportionately large equity interests received by the Company, a Subsidiary
of the Company or a Restricted Affiliate of the Company relative to their
respective contributions being ignored for this purpose); and
(f) Guarantees by the Company or a Subsidiary of the Company of up to
$15 million in principal amount of Indebtedness of the Company's Subsidiaries or
Restricted Affiliates at any one time outstanding and related accrued interest.
"Permitted Investments" means Investments in (a) any of the Senior
Notes; (b) Cash Equivalents; (c) intercompany notes to the extent permitted
under clause (d) of the definition of "Permitted Indebtedness," (d) Investments
17
in any Person if as a result of such Investment such Person becomes a Subsidiary
or Restricted Affiliate of the Company or is merged with or into Company or a
Subsidiary or Restricted Affiliate of the Company, so long as the surviving
entity if the Company or a Subsidiary or Restricted Affiliate of the Company and
(e) other Investments, provided that, after giving pro forma effect to teach
such Investment, the aggregate amount of all such Investments made on and after
the Issue Date that are outstanding (after giving effect to any such Investments
that are returned to the Company or the Subsidiary or Restricted Affiliate that
made such prior Investment, without restriction, in cash on or prior to the date
of any such calculation) at any time does not exceed the sum of (i) $100
million, plus (i) the Net Cash Proceeds received by the Company from the sale
(other than (A) to any Subsidiary or Restricted Affiliate of the Company, (B) to
the extent used to effect a Qualified Exchange, or (C) to make Restricted
Payments) of its Qualified Stock after the Issue Date, minus (iii) the amount of
any payments made (other than pursuant to a Qualified Exchange) in connection
with the retirement of the Series A Convertible Preferred Stock, plus (iv) net
proceeds received from The Wharf (Holdings) Limited ("Wharf Holdings"), or any
of its affiliates due to the wrongful acts, as determined in a final judgment of
a court of competent jurisdiction, or pursuant to a contractual settlement of
claims, in either case no longer subject to appeal or review, of Wharf Holdings
or any of its affiliates, and plus (v) to the extent that any Unrestricted
Subsidiary or Affiliate is properly designated as a Subsidiary or Restricted
Affiliate in accordance with the terms of the Indenture, an amount equal to the
Fair Market Value of the Company's Pro Rata Share of such properly designated
Subsidiary or Restricted Affiliate. For purposes of clause (e), the amount of an
Investment made by a Subsidiary, other than a Wholly Owned Subsidiary, or a
Restricted Affiliate, shall be deemed to equal the total amount of such
Investment multiplied by the Company's Pro Rata Share in such Person making the
Investment.
"Permitted Lien" means (a) Liens existing on the Issue Date; (b) Liens
imposed by governmental authorities for taxes, assessments or other charges not
yet subject to penalty or which are being contested in good faith and by
appropriate proceedings, if adequate reserves with respect thereto are
maintained on the books of the company in accordance with GAAP; (c) statutory
liens of carriers, warehousemen, mechanics, material men, landlords, repairmen
or other like Liens arising by operation of law in the ordinary course of
business, provided that (i) the underlying obligations are not overdue for a
period of more than 30 days, or (ii) such Liens are being contested in good
faith and by appropriate proceedings and adequate reserves with respect thereto
are maintained on the books of the Company in accordance with GAAP; (d) Liens
18
securing the performance of bids, trade contracts (other than borrowed money),
leases, statutory obligations, surety and appeal bonds, performance bonds and
other obligations of a like nature incurred in the ordinary course of business;
(e) easements, rights-of-way, zoning, similar restrictions and other similar
encumbrances or title defects which, singly or in the aggregate, do not in any
case materially detract from the value of the property, subject thereto (as such
property is used by the Company or any of its Subsidiaries) or interfere with
the ordinary conduct of the business of the Company or any of its Subsidiaries;
(f) Liens arising by operation of law in connection with judgments, only to the
extent, for an amount and for a period not resulting in an Event of Default with
respect thereto; (g) pledges or deposits made in the ordinary course of business
in connection with workers' compensation, unemployment insurance and other types
of social security legislation; (h) leases or subleases granted to other Persons
in the ordinary course of business not materially interfering with the conduct
of the business of the Company or any of its Subsidiaries or materially
detracting from the value of the relative assets of the Company or any
Subsidiary; and (i) Liens arising from precautionary Uniform Commercial Code
financing statement filings regarding operating leases entered into by the
Company or any of its Subsidiaries in the ordinary course of business.
"Person" means any individual, corporation, partnership, joint venture,
association, joint-stock company, trust, unincorporated organization or
government or agency or political subdivision thereof (including any subdivision
or ongoing business of any such entity or substantially all of the assets of any
such entity, subdivision or business).
"Principals" means Apollo Cable Partners, L.P., Apollo Advisors. L.P.,
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇,
▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ Investments, Ltd (so long as it is controlled by
▇▇▇▇▇▇ or ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇), ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, ▇. ▇▇▇▇▇▇▇▇▇ Holdings, Co. and
the ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ Family Trust (so long as each is controlled by ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇ or trustees appointed by him), ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇ and ▇▇▇▇ ▇.
▇▇▇▇▇▇▇▇▇.
"Pro Rata Share" means that portion of an Investment that corresponds
to the Company's direct or indirect percentage interest in the profits of the
Person in whom such Investment was made or, in the case of a transfer of
property, the direct or indirect percentage interest in the profits of the
Person making such Investment (which would be 100% in the case of any
Investments made by the Company directly). The Pro Rata Share of an Investment
as of any date shall be determined in good faith by the Company's Board of
Directors.
19
"Public Equity Offering" means a primary underwritten public offering
and sale, after the Issue Date, of Qualified Capital Stock of the Company
registered pursuant to the Securities Act for Net Cash Proceeds (after
commissions, discounts, fees and expenses) to the Company of at least $20
million.
"Purchase Money Indebtedness" means any Indebtedness of such Person to
any seller or other Person incurred solely to finance the acquisition (including
in the case of a Capitalized Lease Obligation, the lease) of any after-acquired
real or personal tangible property which, in the reasonable good faith judgment
of the Board of Directors of the Company, is directly related to a Related
Business of such Person and which is incurred concurrently with such acquisition
and is secured only by the assets so financed.
"Purchaser Resale Notice" shall have the meaning set forth in the Note
Purchase Agreement.
"Purchasers" means UIH Funding Inc., ▇▇▇▇▇▇▇ ▇▇▇▇▇ Barney, Inc., TD
Securities (USA), Inc. and Chase Securities Inc.
"Qualified Capital Stock" means any Equity Interest of the Company that
is not Disqualified Capital Stock.
"Qualified Exchange" means any legal defeasance, redemption,
retirement, repurchase or other acquisition of Capital Stock or Indebtedness (in
the case of such Indebtedness, that was issued on or after the Issue Date) of
the Company with the Net Cash Proceeds received by the Company from the
substantially concurrent sale of Qualified Capital Stock or any exchange of
Qualified Capital Stock for any Capital Stock or Indebtedness of the Company
issued on or after the Issue Date.
"Record Date" means a Record Date specified in the Securities whether
or not such Record Date is a Business Day.
"Redemption Date," when used with respect to any Senior Note to be
redeemed pursuant to Section 3.5 hereof and paragraph 4 of the Securities, means
the date fixed for such redemption pursuant to such Section 3.5 and paragraph 4.
"Redemption Price," when used with respect to any Senior Note to be
redeemed pursuant to Section 3.5 hereof and paragraph 4 of the Securities, means
the redemption price for such redemption specified pursuant thereto as Exhibit
20
A, which shall include, without duplication, in each case, accrued and unpaid
interest and Liquidated Damages, if any to the Redemption Date.
"Reference Period" with regard to any Person means the two full fiscal
quarters (or such lesser period during which such Person has been in existence)
ended immediately preceding any date upon which any determination is to be made
pursuant to the terms of the Senior Notes or the Indenture.
"Refinancing Indebtedness" means Indebtedness or Disqualified Capital
Stock (a) issued in exchange for, or the proceeds from the issuance and sale of
which are used substantially concurrently to repay, redeem, defease, refund,
refinance, discharge or otherwise retire for value, in whole or in part, or (b)
constituting an amendment, modification or supplement to, or a deferral or
renewal of ((a) and (b) above are, collectively, a "Refinancing"), any
Indebtedness or Disqualified Capital Stock in a principal amount (or, if issued
with an original issue discount, an original accreted value, determined in
accordance with GAAP) or, in the case of Disqualified Capital Stock, liquidation
preference, not to exceed (after deduction of reasonable and customary fees and
expenses incurred in connection with the Refinancing and the payment of any
premium in accordance with the terms of the Indebtedness or Disqualified Capital
Stock being refinanced, without regard to any modification thereof made in
connection with or in contemplation of such refinancing) the lesser of (i) the
principal amount or, in the case of Disqualified Capital Stock, liquidation
preference, of the Indebtedness or Disqualified Capital Stock so Refinanced and
(ii) if such Indebtedness being Refinanced was issued with an original issue
discount, the accreted value thereof (as determined in accordance with GAAP) at
the time of such Refinancing; provided that (A) such Refinancing Indebtedness of
any Subsidiary or Restricted Affiliate of the Company shall only be used to
Refinance outstanding Indebtedness or Disqualified Capital Stock, as the case
may be, of such Subsidiary or Restricted Affiliate, (B) such Refinancing
Indebtedness shall (x) not have an Average Life shorter than the Indebtedness or
Disqualified Capital Stock to be so refinanced at the time of such Refinancing
and (y) in all respects, be no less subordinated or junior, if applicable, to
the rights of Holders of the Senior Notes than was the Indebtedness or
Disqualified Capital Stock to be refinanced and (C) such Refinancing
Indebtedness shall have a final installment of principal (or redemption payment)
scheduled to come due no earlier than the final scheduled maturity of the
Indebtedness or Disqualified Capital Stock to be so refinanced.
"Registration Rights Agreement" means the Registration Rights Agreement
dated as of the date hereof by and between the Initial Purchasers and the
21
Company, as such agreement may be amended, modified or supplemented from time to
time in accordance with the terms thereof.
"Related Business" means any business in which the Company, its
Subsidiaries or affiliated companies are engaged, as of the date of the
Indenture, or, directly or indirectly, (i) that consists primarily of, or is
related to, operating, acquiring, developing and constructing multi-channel
television systems, programming services, wire-based or "wireless" telephony
services and related services, (ii) that uses existing or future technology for
the transmission and delivery of programming, voice or other data or (iii) that
supports or is incidental to any business listed in clause (i) or (ii).
"Related Party" with respect to any Principal means (A) any controlling
stockholder or, 80% (or more) owned Subsidiary of such Principal, or with
respect to each individual Principal, (i) family partnerships, corporations or
other entities holding Equity Interests in the Company solely for the benefit of
such Principal or any of the Persons listed in (ii), (iii), (iv) or (v) below,
(ii) such Principal's spouse, (iii) such Principal's children, grandchildren,
stepchildren, stepgrandchildren and their spouses, (iv) heirs, legatees and
devisees, and (v) trusts solely for the benefit of any of the foregoing; or (B)
any trust, corporation, partnership or other entity, the beneficiaries,
stockholders, partners, owners or Persons beneficially holding an 80% or more
controlling interest of which consist of such Principal and/or such other
Persons referred to in the immediately preceding clause (A).
"Responsible Officer," when used with respect to the Trustee, means any
officer within the Corporate Trust Administration of the Trustee (or any
successor group of the Trustee) or any other officer of the Trustee customarily
performing functions similar to those performed by any of the above designated
officers and also means, with respect to a particular corporate trust matter,
any other officer to whom such matter is referred because of his knowledge of
and familiarity with the particular subject.
"Restricted Affiliate" means any Person that has been designated in a
Board Resolution as a Restricted Affiliate based on a determination by the Board
of Directors that the Company has, directly or indirectly, the requisite control
over such Person to prevent it from incurring any Indebtedness, issuing any
preferred stock, making any dividend, distribution, repurchase, retirement, or
payment with respect to its Capital Stock (except on a pro rata basis with
respect to all holders of its Capital Stock), or otherwise taking any action at
any time in contravention of Sections 4.7, 4.9 and 4.15 that are applicable to
Restricted Affiliates. The Company will be required to deliver an Officers'
Certificate to the Trustee, including a copy of the Board Resolution, upon
22
designating any Person as a Restricted Affiliate. The Board of Directors may
designate a Restricted Affiliate no longer to be a Restricted Affiliate,
provided that no Default or Event of Default will occur as a consequence thereof
and that such redesignation shall be an Investment treated as having been made
as set forth in the last sentence of the definition of "Investment." The
companies listed as Restricted Affiliates in Annex A to the Offering Memorandum
shall be deemed to be Restricted Affiliates as of the Issue Date for purposes of
this Indenture, until redesignated in compliance therewith.
"Restricted Investment" means, in one or a series of related
transactions, any Investment, other than Permitted Investments.
"Restricted Payment" means, with respect to any Person, (a) the
declaration or payment of any dividend or other distribution in respect of
Equity Interests of such Person or any parent or Subsidiary or Restricted
Affiliate of such Person, (b) any payment on account of the purchase, redemption
or other acquisition or retirement for value of Equity Interests of such Person
or any Subsidiary or Restricted Affiliate or parent of such Person, (c) other
than with the proceeds from the substantially concurrent sale of, or in exchange
for, Refinancing Indebtedness any purchase, redemption, or other acquisition or
retirement for value of, any payment in respect of any amendment of the terms of
or any defeasance of, any Subordinated Indebtedness, directly or indirectly, by
such Person or a parent or Subsidiary or Restricted Affiliate of such Person
prior to the scheduled maturity, any scheduled repayment of principal, or
scheduled sinking fund payment, as the case may be, of such Indebtedness and (d)
any Restricted Investment by such Person; provided, however, that the term
"Restricted Payment" does not include (i) any dividend, distribution or other
payment on or with respect to Equity Interests of an issuer to the extent
payable solely in shares of Qualified Capital Stock of such issuer, or (ii) any
dividend, distribution or other payment to, or Investment in, the Company or any
of its Subsidiaries or Restricted Affiliates by the Company or any of its
Subsidiaries or Restricted Affiliates; provided that with respect to this clause
(iii), any Investment in the Company shall have resulted in the receipt by the
Company or its Subsidiaries of the considerations constituting such Investment.
"Retained Assets" means the Company's ownership and other interests in
the Persons that comprise the Teleport St. Petersburg operating Company.
"SEC" or "Commission" means the Securities and Exchange Commission.
23
"Securities" or "Senior Notes" means, collectively, the Initial
Securities and, when and if issued as provided in the Registration Rights
Agreement, the Exchange Securities and, to the extent not included in the
definition of Initial Securities, the Additional Notes issued in compliance with
clause (b) of Section 4.9 and whose terms are governed by this Indenture.
"Securities Act" means the Securities Act of 1933, as amended.
"Securities Custodian" means the Trustee, as custodian with respect to
the Securities in global form, or any successor entity thereto.
"Senior Notes" See the definition of Securities.
"Series A Convertible Preferred Stock" means the 32,000 shares of the
Company's Series A Convertible Preferred Stock outstanding on the Issue Date.
"Series B Convertible Preferred Stock" means the 139,031 shares of the
Company's Series B Convertible Preferred Stock outstanding on the Issue Date.
"Significant Subsidiary" shall have the meaning provided under
Regulation S-X of the Securities Act, as in effect on the Issue Date.
"Stated Maturity," when used with respect to any Senior Note, means May
1, 2009.
"Subordinated Indebtedness" means Indebtedness of the Company that is
subordinated in right of payment by its terms or the terms of any document or
instrument or instruments, relating thereto to the Senior Notes, in any respect
or has a stated maturity on (except for the Senior Notes and any other
Indebtedness incurred pursuant to clause (b) of Section 4.9) or after the Stated
Maturity.
"Subsidiary" with respect to any Person, means (i) a corporation a
majority of whose Equity Interests with voting power, under ordinary
circumstances, to elect directors is at the time, directly or indirectly, owned
by such Person, by such Person and one or more Subsidiaries of such Person or by
one or more Subsidiaries of such Person, (ii) any other Person (other than a
corporation) in which such Person, one or more Subsidiaries of such Person, or
such Person and one or more Subsidiaries of such Person, directly or indirectly,
at the date of determination thereof has at least majority ownership interest,
or (iii) a partnership in which such Person or a Subsidiary of such Person is,
24
at the time, the managing general partner. Notwithstanding the foregoing, an
Unrestricted Subsidiary shall not be a Subsidiary of the Company or of any
Subsidiary of the Company. Unless the context requires otherwise, Subsidiary
means each direct and indirect Subsidiary of the Company.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ▇▇.▇▇.
77aaa-77bbbb) as in effect on the date on which this Indenture is qualified
under the TIA.
"Transfer Restricted Securities" means Securities that bear or are
required to bear the legend set forth in Section 2.6.
"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.
"UIHE" means UIH Europe, Inc., a Delaware corporation, and wholly owned
Subsidiary of the Company and formerly know as Joint Venture, Inc.
"UIPI" means United International Properties, Inc., a Delaware
corporation and a direct Wholly Owned Restricted Subsidiary of the Company.
"Unrestricted Subsidiary" means (a) those subsidiaries of the Company
listed in Annex B attached to the Offering Memorandum, and (b) any subsidiary of
the Company that does not own any Equity Interests of, or own or hold any Lien
on any property of, the Company or any other Subsidiary of the Company and that
is designated as an Unrestricted Subsidiary by the Board of Directors of the
Company; provided that (i) such subsidiary shall not engage, to any substantial
extent, in any line or lines of business activity other than a Related Business,
and (ii) after giving pro forma effect to such designation would there exist a
Default or Event of Default. The Board of Directors of the Company may designate
any Unrestricted Subsidiary to be a Subsidiary, provided that no Default or
Event of Default will occur as a consequence thereof. Each such designation
shall be evidenced by filing with the Trustee a certified copy of the resolution
giving effect to such designation and an Officers' Certificate certifying that
such designation complied with the foregoing conditions.
"UPC" shall have the meaning set forth in the Offering Memorandum.
"U.S. Government Obligations" or "U.S. Government Securities" means
direct non-callable obligations of, or noncallable obligations guaranteed by,
25
the United States of America for the payment of which obligation or guarantee
the full faith and credit of the United States of America is pledged.
"Wholly Owned Subsidiary" means a Subsidiary at least 99% of the Equity
Interests of which are owned by the Company or one or more Wholly Owned
Subsidiaries of the Company.
Section 1.2 OTHER DEFINITIONS.
Term Defined in Section
"Affiliate Transaction" 4.11
"Asset Sale" 4.10
"Asset Sale Offer" 4.10
"Asset Sale Offer Amount" 4.10
"Asset Sale Offer Price" 4.10
"Change of Control Offer" 4.18
"Change of Control Purchase Date" 4.18
"Change of Control Offer Period" 4.18
"Change of Control Purchase Price" 4.18
"Covenant Defeasance" 8.3
"Event of Default" 6.1
"Excess Proceeds" 4.10
"incur" 4.9
"Legal Defeasance" 8.2
"Paying Agent" 2.3
"Registrar" 2.3
"Repurchase Offer" 3.1
"Restricted Payments" 4.7
"Unrestricted Investment" 4.16
Section 1.3 INCORPORATION 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:
"indenture securities" means the Securities;
26
"indenture security holder" means a Holder of a Security;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the
Trustee;
"obligor" on the Securities means the Company and any
successor obligor upon the Securities.
All other terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by SEC rule under the TIA
have the meanings so assigned to them.
Section 1.4 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
(2) an accounting term not otherwise defined has the meaning assigned
to it in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural include
the singular;
(5) provisions apply to successive events and transactions; and
(6) references to sections of or rules under the Securities Act shall
be deemed to include substitute, replacement of successor sections or rules
adopted by the SEC from time to time.
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ARTICLE II
THE SECURITIES
Section 2.2 FORM AND DATING.
The Securities and the Trustee's certificate of authentication shall be
substantially in the form of Exhibit A hereto. The Securities may have
notations, legends or endorsements approved as to form by the Company and
required by law, stock exchange rule, agreements to which the Company is subject
or usage. Each Security shall be dated the date of its authentication. The
Securities shall be issuable only in denominations of $1,000 (or such greater
amount as a result of any increase in the Accretion Rate) and integral multiples
thereof.
The terms and provisions contained in the Securities shall constitute,
and are hereby expressly made, a part of this Indenture, and the Company and the
Trustee, by their execution and delivery of this Indenture, expressly agree to
such terms and provisions and to be bound thereby.
Each Global Security shall represent such of the outstanding Securities
as shall be specified therein and each shall represent the aggregate amount of
outstanding Securities that may from time to time be reduced or increased, as
appropriate, to reflect exchanges, repurchases and redemptions. Any endorsement
of a Global Security to reflect the amount of any increase or decrease in the
amount of outstanding Securities represented thereby shall be made by the
Trustee or the Securities Custodian, at the direction of the Trustee, in
accordance with instructions given by the Holder thereof as required by Section
2.6
Section 2.2 EXECUTION AND AUTHENTICATION.
Two Officers of the Company shall sign the Securities for the Company
by manual or facsimile signature. The Company's seal shall be reproduced on the
Securities and may be in facsimile form.
If an Officer whose signature is on a Security no longer holds that
office at the time a Security is authenticated, the Security shall nevertheless
be valid.
A Security shall not be valid until authenticated by the manual
signature of the Trustee. The signature shall be conclusive evidence that the
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Security has been authenticated under this Indenture. The form of Trustee's
certificate of authentication to be borne by the Securities shall be
substantially as set forth in Exhibit A hereto.
The Trustee shall authenticate Initial Securities for original issue in
the aggregate principal amount of up to $[355,000,000] and shall authenticate
Exchange Securities for original issue in the aggregate principal amount of up
to $[355,000,000], in each case upon a written order of the Company in the form
of an Officers' Certificate; provided that such Exchange Securities shall be
issuable only upon the valid surrender for cancellation of Initial Securities of
a like aggregate principal amount at maturity in accordance with the
Registration Rights Agreement. The Officers' Certificate shall specify the
amount of Securities to be authenticated and the date on which the Securities
are to be authenticated. The aggregate principal amount of Securities
outstanding at any time may not exceed $[355,000,000] (or such greater amount as
would be necessary to reflect any increase in the Accretion Rate) and except as
provided in Section 2.7. Upon the written order of the Company in the form of an
Officers' Certificate, the Trustee shall authenticate Securities in substitution
of Securities originally issued to reflect any name change of the Company.
The Trustee may appoint an authenticating agent acceptable to the
Company to authenticate Securities. 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 the Company.
Section 2.3 REGISTRAR AND PAYING AGENT.
The Company shall maintain an office or agency where Securities may be
presented for registration of transfer or for 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 may change
any Paying Agent or Registrar without prior notice to any Holder. The Company
shall notify the Trustee in writing of the name and address of any Agent not a
party to this Indenture. If the Company fails to appoint or maintain another
entity as Registrar or Paying Agent, the Trustee shall act as such. The Company
may act as Paying Agent or Registrar.
29
The Company initially appoints The Depositary Trust Company ("DTC"), to
act as Depositary with respect to the Global Securities.
The Company initially appoints the Trustee to act as the Registrar and
Paying Agent and agent for service of notices and demands in connection with the
Securities.
Section 2.4 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 (or Liquidated Damages, if any) on
the Securities, and will notify the Trustee of any default by the Company 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. The Company
at any time may require a Paying Agent to pay all money held by it to the
Trustee. Upon payment over to the Trustee, the Paying Agent (if other than the
Company) shall have no further liability for the money delivered to the Trustee.
If 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.
Upon any bankruptcy or reorganization proceedings relating to the Company, the
Trustee shall serve as paying Agent for the Securities.
Section 2.5 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
all Holders and shall otherwise comply with TIA ss. 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 the Holders of
Securities, including the aggregate principal amount at maturity of the Senior
Notes held by each thereof.
Section 2.6 TRANSFER AND EXCHANGE.
(a) TRANSFER AND EXCHANGE OF DEFINITIVE SECURITIES. When Definitive
Securities are presented to the Registrar with a request:
(x) to register the transfer of such Definitive
Securities; or
30
(y) to exchange such Definitive Securities for an equal
principal amount at maturity of Definitive Securities of other authorized
denominations, the Registrar shall register the transfer or make the exchange as
requested if its reasonable requirements for such transaction are met; provided,
however, that the Definitive Securities surrendered for registration of transfer
or exchange:
(i) shall be duly endorsed or accompanied by a
written instrument of transfer in form reasonably satisfactory to the
Company and the Registrar, duly executed by the Holder thereof or his
attorney duly authorized in writing; and
(ii) in the case of Transfer Restricted Securities
that are Definitive Securities, shall be accompanied by the following
additional information and documents, as applicable:
(A) if such Transfer Restricted Security is being delivered to the
Registrar by a Holder for registration in the name of such Holder, without
transfer, a certification from such Holder to that effect (in substantially the
form set forth on the reverse of the Security); or
(B) if such Transfer Restricted Security is being transferred to a
"qualified institutional buyer" (within the meaning of Rule 144A promulgated
under the Securities Act) that is aware that any sale of Securities to it will
be made in reliance on Rule 144A under the Securities Act and that is acquiring
such Transfer Restricted Security for its own account or for the account of
another such "qualified institutional buyer," a certification from such Holder
to that effect (in substantially the form set forth on the reverse of the
Security); or
(C) if such Transfer Restricted Security is being transferred pursuant
to an exemption from registration in accordance with Rule 144, or outside the
United States in an offshore transaction in compliance with Rule 904 under the
Securities Act, or pursuant to an effective registration statement under the
Securities Act, a certification from such Holder to that effect (in
substantially the form set forth on the reverse of the Security); or
(D) if such Transfer Restricted Security is being transferred in
reliance on another exemption from the registration requirements of the
Securities Act and with all applicable securities laws of the States of the
United States, a certification from such Holder to that effect (in substantially
the form set forth on the reverse of the Security) and an Opinion of Counsel
reasonably acceptable to the Company and to the Registrar to the effect that
such transfer is in compliance with the Securities Act.
31
(b) RESTRICTIONS ON TRANSFER OF A DEFINITIVE SECURITY FOR A BENEFICIAL
INTEREST IN A GLOBAL SECURITY. A Definitive Security may not be exchanged for a
beneficial interest in a Global Security except upon satisfaction of the
requirements set forth below. Upon receipt by the Trustee of a Definitive
Security, duly endorsed or accompanied by appropriate instruments of transfer,
in form satisfactory to the Trustee, together with:
(i) if such Definitive Security is a Transfer
Restricted Security, certification, substantially in the form set forth
on the reverse of the Security, that such Definitive Security is being
transferred to a "qualified institutional buyer" (as defined in Rule
144A under the Securities Act) in accordance with Rule 144A under the
Securities Act; and
(ii) whether or not such Definitive Security is a
Transfer Restricted Security, written instructions directing the
Trustee to make, or to direct the Securities Custodian to make, an
endorsement on the Global Security to reflect an increase in the
aggregate principal amount of the Securities
represented by the Global Security,
then the Trustee shall cancel such Definitive Security and cause, or direct the
Securities Custodian to cause, in accordance with the standing instructions and
procedures existing between the Depositary and the Securities Custodian, the
aggregate principal amount at maturity of Securities represented by the Global
Security to be increased accordingly. If no Global Securities are then
outstanding, the Company shall issue and the Trustee shall authenticate a new
Global Security in the appropriate principal amount at maturity.
(c) TRANSFER AND EXCHANGE OF GLOBAL SECURITIES. 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.
(d) TRANSFER OF A BENEFICIAL INTEREST IN A GLOBAL SECURITY FOR A
DEFINITIVE SECURITY.
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(i) Any Person having a beneficial interest in a
Global Security may upon request exchange such beneficial interest for
a Definitive Security. Upon receipt by the Trustee of written
instructions or such other form of instructions as is customary for the
Depositary, from the Depositary or its nominee on behalf of any Person
having a beneficial interest in a Global Security, and upon receipt by
the Trustee of a written instruction or such other form of instructions
as is customary for the Depositary or the Person designated by the
Depositary as having such a beneficial interest in a Transfer
Restricted Security only, the following additional information and
documents (all of which may be submitted by facsimile):
(A) if such beneficial interest is being transferred to the
Person designated by the Depositary as being the beneficial owner, a
certification from the transferor to that effect (in substantially the
form set forth on the reverse of the Security); or
(B) if such beneficial interest is being transferred to a
"qualified institutional buyer" (within the meaning of Rule 144A
promulgated under the Securities Act), that is aware that any sale of
Securities to it will be made in reliance on Rule 144A under the
Securities Act and that is acquiring such beneficial interest in the
Transfer Restricted Security for its own account or the account of
another such "qualified institutional buyer", a certification to that
effect from the transferor (in substantially the form set forth on the
reverse of the Security); or
(C) if such beneficial interest is being transferred pursuant
to an exemption from registration in accordance with Rule 144, or
outside the United States in an offshore transaction in compliance with
Rule 904 under the Securities Act, or pursuant to an effective
registration statement under the Securities Act, a certification from
the transferor to that effect (in substantially the form set forth on
the reverse of the Security); or
(D) if such beneficial interest is being transferred in
reliance on another exemption from the registration requirements of the
Securities Act and in accordance with all applicable securities laws of
the States of the United States, a certification to that effect from
the transferor (in substantially the form set forth on the reverse of
the Security) and an Opinion of Counsel from the transferee or
33
transferor reasonably acceptable to the Issuers and to the Registrar to
the effect that such transfer is in compliance with the Securities Act,
then the Trustee or the Securities Custodian, at the direction of the Trustee,
will cause, in accordance with the standing instructions and procedures existing
between the Depositary and the Securities Custodian, the aggregate principal
amount of the Global Security to be reduced and, following such reduction, the
Issuers will execute and, upon receipt of an authentication order in the form of
an Officers' Certificate, the Trustee's authenticating agent will authenticate
and deliver to the transferee a Definitive Security in the appropriate principal
amount.
(ii) Definitive Securities issued in exchange for a
beneficial interest in a Global Security pursuant to this Section
2.6(d) shall be registered in such names and in such authorized
denominations as the Depositary, pursuant to instructions from its
direct or indirect participants or otherwise, shall instruct the
Trustee. The Trustee shall deliver such Definitive Securities to the
persons in whose names such Securities are so registered.
(e) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL SECURITIES.
Notwithstanding any other provisions of this Indenture (other than the
provisions set forth in subsection (f) of this Section 2.6), 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.
(f) AUTHENTICATION OF DEFINITIVE SECURITIES IN ABSENCE OF DEPOSI TARY.
If at any time:
(i) the Depositary for the Securities noti fies the
Company that the Depositary is unwilling or unable to continue as
Depositary for the Global Securities and a successor Depositary for the
Global Securities is not appointed by the Company within ninety days
after delivery of such notice; or
(ii) the Company, in its sole discretion, notifies
the Trustee in writing that it elects to cause the issuance of
Definitive Securities under this Indenture, then the Company will
execute, and the Trustee, upon receipt of an Officers' Certificate
requesting the authentication and delivery of Definitive Securities,
34
will, or its authenticating agent will, authenticate and deliver
Definitive Securities, in an aggregate principal amount at maturity
equal to the principal amount at maturity of the Global Securities, in
exchange for such Global Securities.
(g) LEGENDS.
(i) Except as permitted by the following paragraphs
(ii) and (iii) each Security certificate evidencing the Global
Securities and the Definitive Securities (and all Securities issued in
exchange therefor or substitution thereof) shall bear a legend in
substantially the following form:
"THIS SENIOR NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED
UNDER THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES
ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED WITHIN THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR
BENEFIT OF, U.S. PERSONS, EXCEPT AS SET FORTH IN THE SECOND SENTENCE
HEREOF. BY ITS ACQUISITION HEREOF OR OF A BENEFICIAL INTEREST HEREIN,
THE HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL
BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) (A "QIB"),
(B) IT IS ACQUIRING THIS SENIOR NOTE IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT OR, (C) AFTER THE
COMPANY HAS RECEIVED A "PURCHASER RESALE NOTICE" (AS DEFINED IN THE
INDENTURE) IT IS AN INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN
RULE 501(A)(1), (2), (3) OR (7) OF REGULATION D UNDER THE SECURITIES
ACT) (AN "IAI"), (2) AGREES THAT IT WILL NOT RESELL OR OTHERWISE
TRANSFER THIS NOTE EXCEPT (A) TO THE COMPANY OR ANY OF ITS
SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS A
QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR RULE 904 OF THE
SECURITIES ACT, (D) AFTER THE COMPANY HAS RECEIVED A "PURCHASER RESALE
NOTICE", IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER
THE SECURITIES ACT, (E) AFTER THE COMPANY HAS RECEIVED A "PURCHASER
35
RESALE NOTICE", TO AN IAI THAT, PRIOR TO SUCH TRANSFER, FURNISHES THE
TRUSTEE WITH A SIGNED LETTER CONTAINING CERTAIN REPRESENTATIONS AND
AGREEMENTS RELATING TO THE TRANSFER OF THIS SENIOR NOTE (THE FORM OF
WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN
RESPECT OF AN AGGREGATE ACCRETED VALUE OF SENIOR NOTES LESS THAN
$250,000, AN OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH
TRANSFER IS IN COMPLIANCE WITH THE SECURITIES ACT, (F) AFTER THE
COMPANY HAS RECEIVED A "PURCHASER RESALE NOTICE" IN ACCORDANCE WITH
ANOTHE EXEMPTION FROM THE REGISTRATION REQUIREMENTS OF THE SECURITIES
ACT (AND IF REQUESTED BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO
THE COMPANY) OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
AND, IN EACH CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF
ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE SECURITIES LAWS
OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION
AND (3) AGREES THAT IT WILL DELIVER TO EACH PERSON TO WHOM THIS SENIOR
NOTE OR AN INTEREST HEREIN IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE
EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION"
AND "UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY RULE 902 OF
REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF
THIS SENIOR NOTE IN VIOLATION OF THE FOREGOING."
(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 Act or
an effective registration statement under the Securities Act:
(A) in the case of any Transfer Restricted Security that is a
Definitive Security, the Registrar shall permit the Holder thereof to
exchange such Transfer Restricted Security for a Definitive Security
that does not bear the legend set forth above and rescind any
restriction on the transfer of such Transfer Restricted Security; and
36
(B) any such Transfer Restricted Security represented by a
Global Security shall not be subject to the provisions set forth in (i)
above (such sales or transfers being subject only to the provisions of
Section 2.6(c) hereof); provided, however, that with respect to any
request for an exchange of a Transfer Restricted Security that is
represented by a Global Security for a Definitive Security that does
not bear a legend, which request is made in reliance upon Rule 144, the
Holder thereof shall certify in writing to the Registrar that such
request is being made pursuant to Rule 144 (such certification to be
substantially in the form set forth on the reverse of the Security).
(iii) Any Exchange Securities issued in connection
with the Exchange Offer shall not bear the legend set forth in (i)
above and the Trustee shall rescind any restriction on the transfer of
such Exchange Securities.
(h) CANCELLATION AND/OR ADJUSTMENT OF GLOBAL SECURITY. At such time as
all beneficial interests in a Global Security have either been exchanged for
Definitive Securities, redeemed, repurchased or cancelled, such Global Security
shall be returned to or retained and cancelled by the Trustee. At any time prior
to such cancellation, if any beneficial interest in a Global Security is
exchanged for Definitive Securities, redeemed, repurchased or cancelled, the
principal amount at maturity of Securities represented by such Global Security
shall be reduced and an endorsement shall be made on such Global Security, by
the Trustee or the Securities Custodian, at the direction of the Trustee, to
reflect such reduction.
(i) OBLIGATIONS WITH RESPECT TO TRANSFERS AND EXCHANGES OF DEFINITIVE
SECURITIES.
(i) To permit registrations of transfers and
exchanges, the Company shall execute and the Trustee or any
authenticating agent of the Trustee shall authenticate Definitive
Securities and Global Securities at the Registrar's
request.
(ii) No service charge shall be made to a Holder 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
37
payable upon exchanges or transfers pursuant to Section 2.2 (fourth
paragraph), 2.10, 4.10, 4.18 paragraph, 8.5, or 9.1 hereof).
(iii) The Registrar shall not be required to register
the transfer of or exchange of (a) any Definitive Security selected for
redemption in whole or in part pursuant to Section 3.5, except the
unredeemed portion of any Definitive 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 pursuant to Section 4.10
or Section 4.18 hereof or redemption of Securities pursuant to Section
3.5 hereof and ending at the close of business on the day of such
mailing.
(iv) 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 or beneficial owners
of interests 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 thereof.
(j) Prior to due presentment for the registration of a transfer of any
Security, the Trustee, any Agent and the Company may deem and treat the Person
in whose name any Security is registered as the absolute owner of such Security
for all purposes, and none of the Trustee, any Agent or the Company shall be
affected by notice to the contrary.
Section 2.7 REPLACEMENT SECURITIES.
If any mutilated Security is surrendered to the Trustee or the Company
and the Trustee receives evidence to its satisfaction of the destruction, loss
or theft of any Security, the Company shall issue and the Trustee, upon the
written order of the Company signed by two Officers of the Company, shall
authenticate a replacement Security if the Trustee's requirements for
replacements of Securities are met. If required by the Trustee or the Company,
an indemnity bond must be supplied by the Holder that is sufficient in the
38
judgment of the Trustee and the Company to protect the Company, the Trustee, any
Agent and any authenticating agent from any loss that any of them may suffer if
a Security is replaced. The Company may charge for its expenses in replacing a
Security.
Every replacement Security is an additional obligation of the Company
and shall be entitled to all of the benefits of this Indenture equally and
proportionately with all other Securities duly issued hereunder.
Section 2.8 OUTSTANDING SECURITIES.
The Securities outstanding at any time are all the Securities
authenticated by the Trustee (including any Security represented by a Global
Security), except for those canceled by it, those delivered to it for
cancellation and those described in this Section 2.8 as not outstanding. Except
as set forth in Section 2.9 hereof, a Security does not cease to be outstanding
because the Company or an Affiliate of the Company holds the Security.
If a Security is replaced pursuant to Section 2.7 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 4.1 hereof, it ceases to be outstanding and it ceases to accrete.
Section 2.9 TREASURY SECURITIES.
In determining whether the Holders of the required principal amount at
maturity of Securities have concurred in any direction, waiver or consent,
Securities owned by the Company, any Subsidiary of the Company or any Affiliate
of the Company shall be considered as though not outstanding, except that for
the purposes of determining whether the Trustee shall be protected in relying on
any such direction, waiver or consent, only Securities that a Trustee knows are
so owned shall be so disregarded. Notwithstanding the foregoing, Securities that
are to be acquired by the Company, any Subsidiary of the Company or any
Affiliate of the Company pursuant to an exchange offer, tender offer or other
agreement shall not be deemed to be owned by the Company, a Subsidiary of the
Company or an Affiliate of the Company until legal title to such Securities pass
to the Company, such Subsidiary or such Affiliate, as the case may be.
39
Section 2.10 TEMPORARY SECURITIES.
Until Definitive Securities are ready for delivery, the Company may
prepare and the Trustee shall authenticate temporary Securities upon a written
order of the Company signed by two Officers of the Company. Temporary Securities
shall be substantially in the form of Definitive Securities but may have
variations that the Company considers appropriate for temporary Securities and
as shall be reasonably acceptable to the Trustee. Without unreasonable delay,
the Company shall prepare and the Trustee shall authenticate Definitive
Securities in exchange for temporary Securities.
Holders of temporary Securities shall be entitled to all of the
benefits of this Indenture.
Section 2.11 CANCELLATION.
The Company at any time may deliver Securities to the Trustee for
cancellation. The Registrar and Paying Agent shall forward to the Trustee any
Securities surrendered to them for registration of transfer, exchange or
payment. The Trustee and no one else shall cancel all Securities surrendered for
registration of transfer, exchange, payment, replacement or cancellation and
shall destroy canceled Securities (subject to the record retention requirement
of the Exchange Act). Certification of the destruction of all canceled
Securities shall be delivered to the Company. The Company may not issue new
Securities to replace Securities that it has paid or that have been delivered to
the Trustee for cancellation.
Section 2.12 RECORD DATE.
The record date for purposes of determining the identity of Holders of
the Securities entitled to vote or consent to any action by vote or consent
authorized or permitted under this Indenture shall be determined as provided for
in TIA ss. 316(c).
Section 2.13 CUSIP NUMBER.
The Company in issuing the Securities may use a "CUSIP" number and, if
it does so, the Trustee shall use the CUSIP number in notices of redemption or
exchange as a convenience to Holders; provided that any such notice may state
that no representation is made as to the correctness or accuracy of the CUSIP
number printed in the notice or on the Securities and that reliance may be
placed only on the other identification numbers printed on the Securities. The
Company will promptly notify the Trustee of any change in the CUSIP number.
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ARTICLE III
REDEMPTION AND REPURCHASE
Section 3.1 OFFER TO REPURCHASE.
In the event that, pursuant to Sections 4.10 or 4.18 hereof, the
Company shall be required to commence an Asset Sale Offer or a Change of Control
Offer (either, a "Repurchase Offer"), it shall follow the procedures specified
below.
The Company shall send, by first class mail, a notice of such
Repurchase Offer to the Trustee and each of the Holders at the following times:
(i) upon the commencement of an Asset Sale Offer or (ii) within 15 days
following any Change of Control, as applicable. The notice of Repurchase Offer,
which shall be sent to all Holders shall contain all instructions and materials
necessary to enable such Holders to tender Securities pursuant to such
Repurchase Offer. The notice of Repurchase Offer, which shall govern the terms
of the Repurchase Offer, shall state:
(a) that the Repurchase Offer is being made pursuant to this Section
3.1 and Section 4.10 or 4.18 hereof, as applicable, and the length of time that
such Repurchase Offer shall remain open;
(b) in the case of an Asset Sale Offer, the Asset Sale Offer Price and
the Asset Sale Offer Period and the relevant repurchase date;
(c) in the case of a Change of Control Offer, the Change of Control
Purchase Price and the Change of Control Purchase Date;
(d) that any Security not tendered or accepted for payment shall
continue to accrete and accrue interest, as applicable;
(e) that, unless the Company defaults in making such payment, any
Security accepted for payment pursuant to a Repurchase Offer shall cease to
accrete after the repurchase date;
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(f) that Holders electing to have a Security purchased pursuant to any
Repurchase Offer shall be required to surrender the Security, with the form
entitled "Option of Holder to Elect Purchase" on the reverse of the Security
completed, to the Company, the depositary or a Paying Agent at the address
specified in the notice at least three days before the repurchase date;
(g) that Holders shall be entitled to withdraw their election if the
Company, the Depositary or the Paying Agent, as the case may be, receives, not
later than the expiration of the Asset Sale Offer Period (with respect to an
Asset Sale Offer) or not later than the close of business on the second Business
Day preceding the applicable Change of Control Offer repurchase date (with
respect to a Change of Control Offer), a telegram, telex, facsimile transmission
or letter setting forth the name of the Holder, the principal amount at maturity
of Securities the Holder delivered for purchase and a statement that such Holder
is withdrawing his election to have such Securities purchased;
(g) that Holders whose Securities were purchased only in part shall be
issued new Securities equal in principal amount at maturity to the unpurchased
portion of the Securities surrendered, which unpurchased portion must be equal
to $1,000 in principal amount at maturity (or such greater amount as a result
solely of an increase in the Accretion Rate) or an integral multiple thereof;
and
(h) that no representation is made as to the correctness or accu racy
of the CUSIP number, if any, listed in such notice or printed on the Securities.
At the Company's request, the Trustee shall give the notice of a
Repurchase Offer in the Company's name and at its expense; provided, however,
that the Com pany shall have delivered to the Trustee, at least 45 days prior to
the repurchase 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 the preceding paragraph.
The Company shall comply with the requirements of Rule l4e-l under the
Exchange Act and any other securities laws and regulations thereunder to the
extent such laws and regulations are applicable in connection with the
repurchase of Securities in connection with a Repurchase Offer.
Section 3.2 DEPOSIT OF REPURCHASE PRICE.
One Business Day prior to or on any repurchase date set in connection
with a Repurchase Offer, the Company shall deposit with the Trustee or with the
Paying Agent money sufficient to pay the repurchase price required by this
42
Indenture for all Securities to be repurchased on that date. The Trustee or the
Paying Agent shall promptly return to the Company any money deposited with the
Trustee or the Paying Agent by the Company in excess of the amounts necessary to
pay the repurchase price of all Securities repurchased.
If the Company complies with the provisions of the preceding paragraph,
on and after such repurchase date, the Securities or the portions of Securities
to be repurchased in accordance with the provisions of this Indenture shall
cease to accrete and interest will cease to accrue, as applicable.
Section 3.3 DELIVERY OF SECURITIES AND PAYMENT OF PURCHASE
PRICE.
One Business Day prior to or on any repurchase date set in connection
with a Repurchase Offer, the Company shall deliver or cause to be delivered to
the Trustee the Securities so accepted together with an Officers' Certificate
stating the aggregate principal amount at maturity of Securities or portions
thereof being purchased by the Company and that such securities were accepted
for repurchase by the Company in accordance with the terms of Section 3.1
hereof. The Company or the Paying Agent, as the case may be, shall promptly (but
in any case not later than five days after the repurchase date) mail or deliver
to each tendering Holder an amount equal to the purchase price of the Securities
tendered by such Holder and accepted by the Company for purchase, and the
Company shall promptly issue a new Security, and the Trustee, upon written
request from the Company shall authenticate and mail or deliver such new
Security to such Holder, in a principal amount at maturity equal to any
unpurchased portion of the Security surrendered, if any, provided, that each
such new Security shall be in a principal amount at maturity of $1,000 (or such
greater amount as a result solely of an increase in the Accretion Rate) or an
integral multiple thereof. Any Security not so accepted shall be promptly mailed
or delivered by the Company to the Holder thereof. The Company shall publicly
announce the results of the Repurchase Offer on or as soon as practicable after
the repurchase date.
Section 3.4 SECURITIES REPURCHASED IN PART.
Upon surrender of a Security that is repurchased in part in connection
with a Repurchase Offer, the Company shall issue and, upon the Company's written
request, the Trustee shall authenticate for the Holder at the expense of the
Company a new Security equal in principal amount at maturity to the unpurchased
portion of the Security surrendered.
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Section 3.5 RIGHT OF REDEMPTION.
The Company shall have the right to redeem Securities as set forth in
paragraph 4 of the Securities and as set forth herein. Redemption of Securities
at the Company's option shall be made only in accordance with this Section 3.5
and such paragraph 4. At its election, the Company may redeem the Securities in
whole or in part, at the times and at the Redemption Prices specified in the
form of Security attached as EXHIBIT A hereto, plus accrued and unpaid interest
and Liquidated Damages, if any, to the applicable Redemption Date. Except as
provided in this paragraph and paragraph 4 of the Securities, the Securities may
not otherwise be redeemed at the option of the Company.
If the Company elects to redeem Securities pursuant to this Section 3.5
and paragraph 4 of the Securities, the Company shall notify the Trustee in
writing of the date on which the applicable Securities are to be redeemed (a
"Redemption Date") and the principal amount at maturity thereof to be redeemed
and whether it wants the Trustee to give notice of redemption to the Holders.
The Company shall give each notice to the Trustee provided for in this
Section 3.5 at least 30 days before the Redemption Date (unless a shorter notice
shall be required by applicable law). Any such notice may be cancelled at any
time prior to notice of such redemption being mailed to any Holder and shall
thereby be void and of no effect.
If fewer than all of the Securities are to be redeemed pursuant to
Paragraph 4 thereof, the Trustee shall, if applicable, select from among such
Securities to be redeemed pro rata or by lot or by such other method as the
Trustee shall determine to be fair and appropriate and in such manner as
complies with any applicable Depositary, legal and stock exchange requirements.
The Trustee shall make the selection from the Securities outstanding
and not previously called for redemption and shall promptly notify the Company
in writing of the Securities selected for redemption and, in the case of any
Security selected for partial redemption, the principal amount at maturity
thereof to be redeemed. Securities in denominations of $1,000 (or such greater
amount that results solely from an increase in the Accretion Rate) may be
redeemed only in whole. The Trustee may select for redemption portions (equal to
$1,000 (or such greater amount that results solely from an increase in the
Accretion Rate) denominations or any integral multiple thereof) of the principal
amount at maturity of Securities that have denominations larger than $1,000 (or
44
such greater amount that results solely from an increase in the Accretion Rate).
Provisions of this Indenture that apply to Securities called for redemption also
apply to portions of Securities called for redemption.
At least 30 days but not more than 60 days before each Redemption Date
(unless another notice period shall be required by applicable law), the Company
shall mail a notice of redemption by first class mail, postage prepaid, to each
Holder whose Securities are to be redeemed (unless a shorter notice period shall
be required by applicable law) to such Holder's last address as then shown upon
the register of the Registrar. At the Company's request, the Trustee shall give
the notice of redemption in the Company's name and at the Company's expense.
Each notice for redemption shall identify the Securities to be redeemed and
shall state:
(1) the Redemption Date;
(2) the Redemption Price, plus the amount of accrued and
unpaid interest and Liquidated Damages, if any, to be paid upon such redemption;
(3) the name, address and telephone number of the Paying
Agent;
(4) that Securities called for redemption must be surrendered
to the Paying Agent at the address specified in such notice to collect the
Redemption Price;
(5) that, unless (a) the Company defaults in its obligation to
deposit cash with the Paying Agent in accordance with this Section 3.5 or (b)
such redemption payment is prevented for any reason, interest and accretion of
Accreted Value on Securities called for redemption ceases accrual of on and
after the Redemption Date and the only remaining right of the Holders of such
Securities is to receive payment of the Redemption Price, plus accrued and
unpaid interest and Liquidated Damages, if any, to the Redemption Date, upon
surrender to the Paying Agent of the Securities called for redemption and to be
redeemed;
(6) if any Security is being redeemed in part, the portion of
the principal amount at maturity, equal to $1,000 (or such greater amount that
results solely from an increase in the Accretion Rate) or any integral multiple
thereof, of such Security to be redeemed and that, after the Redemption Date,
and upon surrender of such Security, a new Security or Securities in aggregate
principal amount at maturity equal to the unredeemed portion thereof will be
issued;
45
(7) if less than all the Securities are to be redeemed, the
identifica tion of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount at maturity of such
Securities to be redeemed;
(8) the CUSIP number of the Securities to be redeemed; and
(9) that the notice is being sent pursuant to this Section 3.5
and pursuant to the redemption provisions of Paragraph 4 of the Securities.
Once notice of redemption is mailed in accordance with this Section
3.5, Securities called for redemption become due and payable on the Redemption
Date and at the Redemption Price, plus accrued and unpaid interest (and
Liquidated Damages, if any) to the Redemption Date. Upon surrender to the
Trustee or Paying Agent, such Securities called for redemption shall be paid at
the Redemption Price, plus accrued and unpaid interest (and Liquidated Damages,
if any) to the Redemption Date; provided that if the Redemption Date is after a
regular Record Date and on or prior to the corresponding Interest Payment Date,
the accrued interest constituting part of the Redemption Price shall be payable
to the Holder of the redeemed Securities registered on the relevant Record Date;
and provided, further, that if a Redemp tion Date is a Legal Holiday, payment
shall be made on the next succeeding Business Day and no interest shall accrue
for the period from such Redemption Date to such succeeding Business Day.
On or before the Redemption Date, the Company shall deposit with the
Paying Agent (other than the Company or an Affiliate of the Company), cash
sufficient to pay the Redemption Price, plus accrued and unpaid interest and
Liquidated Damages, if any, to the Redemption Date, of all Securities to be
redeemed on such Redemption Date (other than Securities or portions thereof
called for redemption on that date that have been delivered by the Company to
the Trustee for cancellation). The Paying Agent shall promptly return to the
Company any cash so deposited which is not required for that purpose upon the
written request of the Company.
If the Company complies with the preceding paragraph and the other
provisions of this Section 3.5 and payment of the Securities called for
redemption is not prevented for any reason, interest on the Securities to be
redeemed will cease to accrue on the applicable Redemption Date, whether or not
such Securities are presented for payment. Notwithstanding anything in this
Section 3.5 to the contrary, if any Security surrendered for redemption in the
manner provided in the Securities shall not be so paid upon surrender for
redemption because of the failure of the Company to comply with the preceding
46
paragraph and the other provisions of this Section 3.5, interest shall continue
to accrue and Accreted Value to increase and be paid from and including the
Redemption Date until such payment is made on the unpaid principal, and, to the
extent lawful, on any interest not paid on such unpaid principal, in each case
at the rate and in the manner provided in this Indenture and the Securities.
Upon surrender of a Security that is to be redeemed in part, the
Company shall execute and the Trustee shall authenticate and deliver to the
Holder, without service charge, a new Security or Securities equal in principal
amount at maturity to the unredeemed portion of the Security surrendered.
ARTICLE IV
COVENANTS
Section 4.1 PAYMENT OF SECURITIES.
The Company shall pay or cause to be paid the principal of and premium,
if any, on the Securities on the dates and in the manner provided in the
Securities. Principal, and premium, if any, shall be considered paid on the date
due if the Paying Agent, if other than the Company, holds as of 10:00 a.m.
Eastern Time on the due date money deposited by the Company in immediately
available funds and designated for and sufficient to pay all principal, and
premium, if any, then due.
The Company shall pay interest (including post-petition interest in any
proceeding under any Bankruptcy Law) on overdue principal, Accreted Value,
interest and premium, if any, at the rate equal to l% per annum in excess of the
then applicable interest rate (or rate of accretion, as applicable) on the
Securities to the extent lawful.
Section 4.2 MAINTENANCE OF OFFICE OR AGENCY.
The Company shall maintain in the Borough of Manhattan, the City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee, Registrar or co-registrar) where Securities may be surrendered
for registration of transfer or for exchange and where notices and demands to or
upon the Company in respect of the Securities and this Indenture may be served.
The Company shall give prompt written notice to the Trustee of the location and
47
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 shall
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 2.3.
Section 4.3 REPORTS.
(a) Whether or not the Company is subject to the reporting requirements
of Section 13 or 15(d) of the Exchange Act, so long as any of the Senior Notes
remain outstanding, the Company shall deliver to the Trustee and to each Holder,
and to prospective purchasers of Senior Notes identified to the Company by
Holders (i) within 15 days after it is or would have been (if it were subject to
such reporting obligations) required to file such with the Commission, annual
and quarterly financial statements substantially equivalent to financial
statements that would have been included in reports filed with the Commission,
if the Company were subject to the requirements of Section 13 or 15(d) of the
Exchange Act, including, with respect to annual information only, a report
thereon by the Company's certified independent public accountants as such would
be required in such reports to the Commission, and, in each case, together with
a management's discussion and analysis of financial condition and results of
operations which would be so required and, unless the Commission will not accept
such copies, file with the Commission the annual, quarterly and other reports
which it is or would have been required to file with the Commission and (ii) any
other information required to be delivered pursuant to Rule 144A(d)(4) under the
Securities Act. The Company shall also comply with the provisions of TIA ss.
314(a).
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(b) 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 the Holders of the Senior Notes under this Section
4.3.
Section 4.4 COMPLIANCE CERTIFICATE.
(a) The Company shall deliver to the Trustee, within 90 days alter the
end of each fiscal year, an Officers' Certificate stating that a review of the
activities of the Company and its Subsidiaries during the preceding fiscal year
has been made under the supervision of the signing Officers with a view to
determining whether the Company has kept, observed, performed and fulfilled its
obligations under this Indenture and further stating, as to each such Officer
signing such certificate, that to the best of his or her knowledge the Company
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 of this Indenture (or, if a Default or
Event of Default shall have occurred, describing all such Defaults or Events of
Default of which he or she may have knowledge and what action the Company is
taking or proposes to take with respect thereto) and that to the best of his or
her knowledge no event has occurred and remains in existence by reason of which
payments on account of the Securities is prohibited or if such event has
occurred, a description of the event and what action the Company is taking or
proposes to take with respect thereto.
(b) So long as not contrary to the then current recommendations of the
American Institute of Certified Public Accountants the year-end financial
statements delivered pursuant to Section 4.3(a) above shall be accompanied by a
written statement of the Company's independent public accountants (who shall be
a firm of established national reputation) that in making the examination
necessary for certification of such financial statements, nothing has come to
their attention that would lead them to believe that the Company has violated
any provisions of Article Four or Article Five hereof or, if any such violation
has occurred, specifying the nature and period of existence thereof, it being
understood that such accountants shall not be liable directly or indirectly to
any Person for any failure to obtain knowledge of any such violation.
(c) The Company shall, so long as any of the Securities are
outstanding, deliver to the Trustee, forthwith upon any Officer becoming aware
of any Default or Event of Default, an Officers Certificate specifying such
Default or Event of Default and what action the Company is taking or proposes to
take with respect thereto.
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Section 4.5 TAXES.
The Company shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments, and governmental levies
except such as are contested in good faith, and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Securities.
Section 4.6 STAY, EXTENSION AND USURY LAWS.
The Company covenants (to the extent that it may lawfully do so) that
it shall not at any time insist upon, plead, or in any manner whatsoever claim
or take the benefit or advantage of, any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that may affect the covenants or
the performance of this Indenture; and the Company (to the extent that it may
lawfully do so) hereby expressly waives all benefit or advantage of any such
law, and covenants that it shall not, by resort to any such law, hinder, delay
or impede the execution of any power herein granted to the Trustee, but shall
suffer and permit the execution of every such power as though no such law has
been enacted.
Section 4.7 LIMITATION ON RESTRICTED PAYMENTS.
The Company will not, and will not permit any of its Subsidiaries or
Restricted Affiliates to, directly or indirectly, make any Restricted Payment
if, after giving effect to such Restricted Payment on a pro forma basis, (1) a
Default or an Event of Default shall have occurred and be continuing, (2) the
Company is not permitted to incur at least $1.00 of additional Indebtedness
pursuant to the Debt Incurrence Ratio in clause (i) of Section 4.9 or (3) the
aggregate amount of all Restricted Payments made by the Company and its
Subsidiaries and Restricted Affiliates, including after giving effect to such
proposed Restricted Payment, from and after the Issue Date, would exceed the sum
of (a) 50% of the aggregate Consolidated Net Income of the Company for the
period (taken as one accounting period), commencing on the Issue Date, to and
including the last day of the fiscal quarter ended immediately prior to the date
of each such calculation for which internal financial statements are available
(or, in the event Consolidated Net Income for such period is a deficit, then
minus 100% of such deficit), plus (b) the aggregate Net Cash Proceeds received
by the Company from the sale of its Qualified Capital Stock (other than (i) to a
Subsidiary or Restricted Affiliate of the Company and (ii) to the extent applied
in connection with a Qualified Exchange), after the Issue Date, less (c) any
50
amounts applied to the uses set forth in clause (e) of the definition of
"Permitted Investment."
The foregoing clauses (2) and (3) of the immediately preceding
paragraph, however, will not prohibit (u) any dividend, distribution or payment
of interest on Disqualified Capital Stock permitted by Section 4.9 (v) open
market repurchases of publicly traded shares of the Company's common stock from
Persons other than officers, employees, directors or Affiliates of the Company,
and repurchases (whether or not in the open market) of such stock from the
estate of any Principal or from a Related Party of such Principal, in either
case upon the death of such Principal, in an aggregate amount not to exceed $15
million on and after the Issue Date, (w) the retirement of the shares of the
Series A Convertible Preferred Stock and Series B Convertible Preferred Stock
outstanding on the Issue Date on its final redemption date and in accordance
with its terms as of the Issue Date, (x) any dividend, distribution, or other
payment (other than a repurchase) by any Subsidiary or Restricted Affiliate of
the Company on its Equity Interests that is paid pro rata to all holders of such
Equity Interests, and any repurchase for Fair Market Value as determined by the
Board of Directors by any Subsidiary or Restricted Affiliate of the Company of
any of such Subsidiary's or Restricted Affiliate's Equity Interests, (y) a
Qualified Exchange, or (z) the payment of any dividend on Qualified Capital
Stock within 60 days after the date of its declaration if such dividend could
have been made on the date of such declaration in compliance with the foregoing
provisions. The full amount of any Restricted Payment made pursuant to the
foregoing clauses (v), (w) and (z) (but not pursuant to clauses (u), (x) or (y))
of the immediately preceding sentence, however, will be deducted in the
calculation of the aggregate amount of Restricted Payments available to be made
referred to in clause (3) of the immediately preceding paragraph.
For purposes of this covenant, the amount of any Restricted Payment, if
other than in cash, shall be the Fair Market Value thereof, as determined in
good faith by the Board of Directors of the Company. Additionally, on the date
of each Restricted Payment, the Company shall deliver an Officers' Certificate
to the Trustee describing in reasonable detail the nature of such Restricted
Payment, stating the amount of such Restricted Payment, stating in reasonable
detail the provisions of the Indenture pursuant to which such Restricted Payment
was made and certifying that such Restricted Payment was made in compliance with
the terms of the Indenture.
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Section 4.8 LIMITATION ON DIVIDENDS AND OTHER PAYMENT RE
STRICTIONS AFFECTING SUBSIDIARIES.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, create, assume or suffer to exist any consensual
restriction on the ability of any Subsidiary of the Company to pay dividends or
make other distributions to or on behalf of, or to pay any obligation to or on
behalf of, or otherwise to transfer assets or property to or on behalf of, or
make or pay loans or advances to or on behalf of, the Company or any Subsidiary
of the Company, except (a) restrictions imposed by the Senior Notes or the
Indenture or by other Indebtedness of the Company ranking pari passu with the
Senior Notes, provided such restrictions are no more restrictive than those
imposed by the Indenture, (b) restrictions imposed by applicable law, (c)
existing restrictions under Indebtedness outstanding on the Issue Date, (d)
restrictions under any Acquired Indebtedness not incurred in violation of the
Indenture or any agreement relating to any property, asset, or business acquired
by the Company or any of its Subsidiaries, which restrictions in each case
existed at the time of acquisition, were not put in place in connection with or
in anticipation of such acquisition and are not applicable to the Company or any
of its Subsidiaries, or Restricted Affiliates, other than the Person or Persons
acquired, or to any property, asset or business, other than the property, asset
or business so acquired, (e) any such restriction or requirement imposed by
Indebtedness or Disqualified Capital Stock incurred under Section 4.9, provided
such restriction or requirement is no more restrictive than that imposed by the
Indenture or any other instrument (including with respect to such Indebtedness)
entered into by the Company or a Subsidiary governing the terms of a bona fide
borrowing by the Company or a Subsidiary from a third party commercial lender
for valid business purposes, (f) restrictions with respect solely to a
Subsidiary of the Company imposed pursuant to a binding agreement which has been
entered into for the sale or disposition of all or substantially all of the
Equity Interests or assets of such Subsidiary, provided such restric tions apply
solely to the Equity Interests or assets of such Subsidiary which are being
sold, and (g) in connection with and pursuant to permitted Refinancings,
replacements of restrictions imposed pursuant to clauses (a), (c) or (d) of this
Section 4.8 that are not more restrictive than those being replaced and do not
apply to the Company or any of its Subsidiaries, or Restricted Affiliates or
assets other than those that would have been covered by the restrictions in the
Indebtedness so refinanced. Notwithstanding the foregoing, neither (a) customary
provisions restricting subletting or assignment of any lease entered into in the
ordinary course of business, consistent with industry practice, nor (b) Liens
permitted under the terms of the Indenture shall in and of themselves be
considered a restriction on the ability of the applicable Subsidiary to transfer
such agreement or assets, as the case may be.
52
Section 4.9 LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTED
NESS AND DISQUALIFIED CAPITAL STOCK.
The Company will not, and will not permit any of its Subsidiaries or
Restricted Affiliates to, directly or indirectly, issue, assume, guaranty,
incur, become directly or indirectly liable with respect to (including as a
result of an Acquisition), or otherwise become responsible for, contingently or
otherwise (individually and collectively, to "incur" or, as appropriate, an
"incurrence"), any Indebtedness or any Disqualified Capital Stock (including
Acquired Indebtedness), other than Permitted Indebtedness. Notwithstanding the
foregoing, if no Default or Event of Default shall have occurred and be
continuing at the time of, or would occur after giving effect on a pro forma
basis to, such incurrence of Indebtedness or Disqualified Capital Stock, then
(i) if on the date of such incurrence (the "Incurrence date"), the Consolidated
Cash Flow Ratio of the Company for the Reference Period immediately preceding
the Incurrence Date, after giving effect on a pro forma basis to such incurrence
of such Indebtedness or Disqualified Capital Stock and, to the extent set forth
in the definition of Consolidated Cash Flow Ratio, the use of proceeds thereof,
would be no more than 6.5 to 1.0 (the "Debt Incurrence Ratio"), then the Company
may incur Indebtedness or Disqualified Capital Stock, provided such Indebtedness
or Disquali fied Capital Stock matures after, and has no payment of cash or
property (other than payments in Qualified Capital Stock or in such Indebtedness
or Disqualified Capital Stock) scheduled on or prior to, May 1, 2004, and (ii)
if on the Incurrence Date either (1) the Consolidated Cash Flow Ratio of a
Subsidiary or Restricted Affiliate of the Company for the Reference Period
immediately preceding the Incurrence Date, after giving effect on a pro forma
basis to such incurrence of such Indebtedness or Disqualified Capital Stock and
to the extent set forth in the definition of Consolidated Cash Flow Ratio, the
use of proceeds thereof, would be no more than 7.0 to 1.0, or (2) the
Consolidated Coverage Ratio of such Subsidiary or Restricted Affiliate for the
Reference Period immediately preceding the Incurrence Date, after giving effect
on a pro forma basis to such incurrence of such Indebtedness or Disqualified
Capital Stock and, to the extent set forth in the definition of Consolidated
Coverage Ratio, the use of proceeds thereof, would be no less than 1.75 to 1.00,
or (3) after giving effect on a pro forma basis to such incurrence of such
Indebtedness or Disqualified Capital Stock, and, to the extent used to retire
other Indebtedness or Disqualified Capital Stock, the use of proceeds therefrom,
the amount of Indebtedness or Disqualified Capital Stock outstanding of such
Subsidiary or Restricted Affiliate would not exceed 225% of the Consolidated
Invested Equity Capital of such Subsidiary or Restricted Affiliate, then, other
than UIPI or UIHE, such Subsidiary or Restricted Affiliate may incur such
Indebtedness or Disqualified Capital Stock, provided in the case of each of
clauses (ii)(1), (2) and (3), (A) the net proceeds therefrom are used in a
53
Related Business of the Company or any affiliated company of the Company and (B)
the amount of any Indebtedness or Disqualified Capital Stock of such Subsidiary
or Restricted Affiliate that has been repaid, redeemed, defeased, refunded,
refinanced, discharged or retired by or with the proceeds of any Refinancing
Indebtedness incurred by the Company shall be deemed to have remained
outstanding for the purposes of calculating the pro forma amounts to be
determined pursuant to such clauses, and, for the purposes of this clause (ii),
other than UIPI or UIHE, a Subsidiary or Restricted Affiliate may be a
co-obligor or guarantor on such Indebtedness or Disqualified Capital Stock of
another Subsidiary or Restricted Affiliate of the Company (A) if such Subsidiary
or Restricted Affiliate owns, either directly or indirectly through one or more
Subsidiaries or Restricted Affiliates of the Company, all or a portion of the
Equity Interests of the Subsidiary or Restricted Affiliate of the Company, other
than UIPI or UIHE, that incurred such Indebtedness or Disqualified Capital
Stock, (B) if all or a portion of the Equity Interests of such Subsidiary or
Restricted Affiliate is owned either directly or indirectly through one or more
Subsidiaries or Restricted Affiliates of the Company by the Subsidiary or
Restricted Affiliate, other than UIPI and UIHE, that incurred such Indebtedness
or Disqualified Capital Stock or (C) if such Subsidiary or Restricted Affiliate
owns, either directly or indirectly through one or more Subsidiaries or
Restricted Affiliates of the Company, all or a portion of the business that will
use the proceeds of such Indebtedness.
In addition, the foregoing limitations will not apply to:
(a) the incurrence by the Company or, except for UIPI and UIHE, its
Subsidiaries and Restricted Affiliates of Indebtedness, provided that the
aggregate amount of such Indebtedness outstanding at any time pursuant to this
paragraph (a) (including any Indebtedness issued to refinance, replace or refund
such Indebtedness) shall not exceed $25 million;
(b) [INTENTIONALLY OMITTED]; and
(c) if no Event of Default shall have occurred and be continuing, the
incurrence by Subsidiaries or Restricted Affiliates of the Company of
Indebtedness pursuant to the Existing Agreements up to, but not in excess of the
maximum applicable amounts of Indebtedness available for borrowing pursuant to
the terms of each such Existing Agreement as in effect on the date of the
Indenture; provided that, in determining the maximum applicable amounts
available it shall be assumed that the Company satisfies any applicable
conditions to borrowing.
54
Indebtedness or Disqualified Capital Stock of any Person which is
outstanding at the time such Person becomes a Subsidiary or Restricted Affiliate
of the Company (including upon designation of any subsidiary or other Person as
a Subsidiary or Restricted Affiliate) or is merged with or into or consolidated
with the Company or a Subsidiary or Restricted Affiliate of the Company shall be
deemed to have been incurred at the time such Person becomes such a Subsidiary
or Restricted Affiliate of the Company or is merged with or into or consolidated
with the Company or a Subsidiary or Restricted Affiliate of the Company, as
applicable.
Notwithstanding anything in the Indenture to the contrary, the Company
shall not be permitted to incur Indebtedness that is subordinated in right of
payment to any other Indebtedness of the Company, unless such Indebtedness to be
incurred is also subordinated in right of payment to the Senior Notes at least
as to the same extent and neither UIPI nor UIHE shall incur any Indebtedness
other than permitted intercompany Indebtedness to the Company.
Section 4.10 LIMITATION ON SALE OF ASSETS AND SUBSIDIARY STOCK.
The Company will not, and will not permit any of its Subsidiaries to,
in one or a series of related transactions, convey, sell, transfer, assign or
otherwise dispose of, directly or indirectly, any of its property, business or
assets (other than cash or Cash Equivalents), including by merger or
consolidation (in the case of a Subsidiary of the Company), and including any
sale or other transfer or issuance of any Equity Interests of any Subsidiary of
the Company, whether by the Company or a Subsidiary of either or through the
issuance, sale or transfer of Equity Interests by a Subsidiary of the Company,
and including any sale and leaseback transaction (any of the foregoing, an
"Asset Sale"), unless (1)(a) within 360 days after the date of such Asset Sale,
the Net Cash Proceeds therefrom (the "Asset Sale Offer Amount") are applied (i)
to the optional redemption of the Senior Notes in accordance with the terms of
the Indenture and other Indebtedness of the Company ranking on a parity with the
Senior Notes with similar provisions requiring the Company to make an offer to
purchase or to redeem such Indebtedness with the proceeds of such Asset Sale,
pro rata in proportion to the respective Accreted Value (or principal amount and
accrued interest in the case of Indebtedness without an original issue discount)
of the Senior Notes and such other Indebtedness then outstanding, (ii) to the
repurchase of the Senior Notes and such other Indebtedness ranking on a parity
with the Senior Notes and having similar provisions requiring the Company to
make an offer to purchase or to redeem such Indebtedness with the proceeds of
such asset sale pursuant to an irrevocable, unconditional cash offer (pro rata
in proportion to the respective Accreted Value (or principal amount and accrued
interest in the case of Indebtedness without an original issue discount) of the
Senior Notes and such other Indebtedness then outstanding) to repurchase the
55
Senior Notes and such other Indebtedness (the "Asset Sale Offer") at a purchase
price of 100% of Accreted Value (the "Asset Sale Offer Price"), together with
accrued interest and Liquidated Damages, if any, to the date of payment, made
within 360 days of such Asset Sale, or (iii) to the repayment of Indebtedness
issued by a Subsidiary of the Company (in respect of which Indebtedness the
Company is not a direct or contingent obligor) if required by the terms of such
Indebtedness, or (b) within 360 days following such Asset Sale, the Asset Sale
Offer Amount is invested in fixed assets and property which in the good faith
reasonable judgment of the Board of Directors of the Company will be an asset
of, and constitute or be a part of a Related Business of, the Company or such
Subsidiary (if it continues to be a Subsidiary) immediately following such
transaction or is used to make Permitted Investments (other than Cash
Equivalents, Senior Notes or the Existing Notes), (2) at least 85% of the
consideration for such Asset Sale or series of related Asset Sales consists of
Cash or Cash Equivalents, and (3) the Board of Directors of the Company
determines, in good faith, that the Company or such Subsidiary, as applicable,
receives fair market value for such Asset Sale.
An Asset Sale Offer may be deferred until the accumulated Net Cash
Proceeds from Asset Sales not applied to the uses set forth in any of clauses
(1)(a)(i), 1(a)(iii) and 1(b) above (the "Excess Proceeds") exceeds $20 million,
provided that, in the case of an Asset Sale by a Subsidiary that is not a Wholly
Owned Subsidiary, only the Company's pro rata portion of such Net Cash Proceeds
shall constitute Net Cash Proceeds subject to the provisions of this Section
4.10. Each Asset Sale Offer shall remain open for 20 Business Days following its
commencement (the "Asset Sale Offer Period"). Upon expiration of the Asset Sale
Offer Period, the Company shall apply the Asset Sale Offer Amount, plus an
amount equal to accrued interest and Liquidated Damages, if any, to the purchase
of all Senior Notes and, if applicable, such other Indebtedness ranking on a
parity with the Senior Notes and with provisions requiring the Company to make
an offer to purchase or redeem such Indebtedness with the proceeds of such Asset
Sale properly tendered (on a pro rata basis if the Asset Sale Offer Amount is
insufficient to purchase all Senior Notes so tendered) at the Asset Sale Offer
Price (together with accrued interest and Liquidated Damages, if any). To the
extent that the aggregate amount of Senior Notes tendered pursuant to an Asset
Sale Offer is less than the Asset Sale Offer Amount, the Company may use any
remaining Net Cash Proceeds for general corporate purposes as otherwise
permitted by the Indenture and following each Asset Sale Offer the Excess
Proceeds amount shall be reset to zero. For purposes of clause (2) above, total
consideration received means the total consideration received for such Asset
Sales, minus the amount of (a) Indebtedness (other than Subordinated
56
Indebtedness) assumed by a transferee of such Asset Sale, (b) Purchase Money
Indebtedness secured solely by the assets sold and repaid upon such Asset Sale
or assumed by a transferee of such Asset Sale and (c) property that within 30
days of such Asset Sale is converted into Cash or Cash Equivalents (to the
extent of such cash or Cash Equivalents received), provided that, with respect
to this clause (c), such cash or Cash Equivalents so received shall be deemed to
have been received on the date of such Asset Sale and shall be applied in the
manner and within the time specified by Section 4.10 pertaining to the proceeds
from such Asset Sale.
Notwithstanding, and without complying with, the foregoing provisions
of the other paragraphs of Section 4.10:
(i) the Company and its Subsidiaries may, in the ordinary course of
business, (A) convey, sell, transfer, assign or otherwise dispose of inventory
acquired and held for resale in the ordinary course of business and (B)
liquidate Cash Equivalents;
(ii) the Company and its Subsidiaries may convey, sell, transfer,
assign or otherwise dispose of assets pursuant to and in accordance with Section
5.1;
(iii) the Company and its Subsidiaries may sell or dispose of damaged,
worn out or other obsolete personal property in the ordinary course of business
so long as such property is no longer necessary for the proper conduct of the
business of the Company or such Subsidiary, as applicable;
(iv) the Company and its Subsidiaries may convey, sell, transfer,
assign or otherwise dispose of assets to the Company or any of its Subsidiaries
or Restricted Affiliates;
(v) the Company and its Subsidiaries may surrender or waive contract
rights or settle, release or surrender of contract, tort or other claims of any
kind or grant Liens not prohibited by the Indenture;
(vi) the Company and its Subsidiaries may exchange all or a portion of
its property, businesses or assets for Permitted Investments (other than Senior
Notes and Existing Notes) or for property, businesses or assets of a type used
in a Related Business, or a combination of any such Permitted Investments,
property, businesses or assets; provided that any Cash or Cash Equivalents
received pursuant to any such exchange shall be applied in the manner applicable
to Net Cash Proceeds from an Asset Sale as set forth pursuant to the provisions
of the immediately preceding provisions of this Section 4.10; and provided,
further, that in the case of a transaction exceeding $15 million of
consideration to any party thereto, the Company shall have obtained a favorable
written opinion by an independent financial advisor of national reputation as to
57
the fairness from a financial point of view to the Company or such Subsidiary of
the proposed transaction.
All Net Cash Proceeds from an Event of Loss shall be invested or used
to repurchase Senior Notes, all within the period and as otherwise provided
above in clause (1) of the first paragraph of this Section 4.10.
Any Asset Sale Offer shall be made in compliance with all applicable
laws, rules, and regulations, including, if applicable, Regulation 14E of the
Exchange Act and the rules and regulations thereunder and all other applicable
Federal and state securities laws. To the extent that the provisions of any
securities laws or regulations conflict with the provisions of this Section
4.10, compliance by the Company or any of its Subsidiaries with such laws and
regulations shall not in and of itself cause a breach of its obligations under
this Section 4.10.
Section 4.11 LIMITATION ON TRANSACTIONS WITH AFFILIATES.
The Company will not, and will not permit any of its Subsidiaries on or
after the Issue Date to enter into any contract, agreement, arrangement or
transaction with any Affiliate of the Company (an "Affiliate Transaction"), or
any series of related Affiliate Transactions, other than Exempted Affiliate
Transactions, (i) unless it is determined by the Board of Directors as evidenced
by a Board Resolution, that the terms of such Affiliate Transaction are fair and
reasonable to the Company, and no less favorable to the Company, than could have
been obtained in an arm's length transaction with a non-Affiliate, (ii) if
involving consideration to either party in excess of $1 million, unless such
Affiliate Transaction(s) is evidenced by an Officers' Certificate addressed and
delivered to the Trustee certifying that such Affiliate Transaction(s) has been
approved by a majority of the members of the Board of Directors that are
disinterested in such transaction and (iii) if involving consideration to either
party in excess of $10 million, unless, in addition, the Company, prior to the
consummation thereof, obtains a written favorable opinion as to the fairness of
such transaction to the Company from a financial point of view from an
independent investment banking firm of national reputation in the United States
or, if pertaining to a matter for which such investment banking firms do not
customarily render such opinions, an appraisal or valuation firm of national
reputation in the United States.
58
Section 4.12 LIMITATION ON LIENS.
The Company will not, and will not permit any of its Subsidiaries to,
directly or indirectly, grant, incur or suffer to exist, other than Permitted
Liens, any Lien upon any of the property or assets of UIPI or UIHE, whether now
owned or hereafter acquired upon any income profits therefrom.
Section 4.13 LINES OF BUSINESS.
The Company will not, and will not permit any of its Subsidiaries or
Restricted Affiliates to, directly or indirectly engage to any substantial
extent in any line or lines of business activity other than that which, in the
reasonable good faith judgment of the Board of Directors of the Company, is a
Related Business.
Section 4.14 CORPORATE EXISTENCE.
Subject to Article 5 hereof, the Company shall do or cause to be done
all things necessary to preserve and keep in full force and effect (i) its
corporate existence, and the corporate, partnership or other existence of each
of its Subsidiaries, in accordance with the respective organizational documents
(as the same may be amended from time to time) of the Company or any such
Subsidiary and (ii) the rights (charter and statutory), licenses and franchises
of the Company and its Subsidiaries; provided, however, that the Company shall
not be required to preserve any such right, license or franchise, or the
corporate, partnership or other existence of any of its Subsidiaries, 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 is not adverse in any material
respect to the Holders of the Securities.
Section 4.15 LIMITATIONS ON SUBSIDIARY STRUCTURE.
Notwithstanding anything in this Indenture to the contrary, the Company
shall not make any Investment in any Person, directly or indirectly, other than
through UIPI or UIHE, which together shall be required to hold, directly or
indirectly, all Investments made by the Company or any of its Restricted
Subsidiaries after the date of this Indenture. In addition, (i) except as
permitted by clause (v) of this Section 4.15, each of UIPI and UIHE shall at all
times continue to be a direct Wholly Owned Subsidiary of the Company and the
Company will not have any other direct subsidiaries other than the Retained
Assets, (ii) neither UIPI nor UIHE shall (although their Subsidiaries and
Restricted Affiliates may, to the extent permitted by Section 4.09 hereof) incur
any Indebtedness, except intercompany Indebtedness from UIPI or UIHE to the
Company or issue any preferred stock, (iii) that UIHE (or, if UIHE is merged
into UIPI as permitted by clause (v) of this Section 4.15, UIPI) will be the
direct beneficial and record owner or all of the Company's direct and indirect
interests in UPC other than those interests held or reserved to be held (as of
the Issue Date) through the foundation administering UPC's employee equity
59
incentive plan, (iv) that neither UIPI nor UIHE will incur or suffer to exist
any Lien, other than Permitted Liens, on any of its assets or property, and (v)
neither UIHE nor UIPI shall consolidate or merger with or into any other Person
(other than each other) prior to the date that none of the Company's Senior
Secured Discount Notes due 1999 are outstanding.
Section 4.16 LIMITATION ON STATUS AS INVESTMENT COMPANY.
The Company shall not, and shall not permit any of its Subsidiaries and
Restricted Affiliates to conduct its business in a fashion that would cause it
to be required to register as an "investment company" (as this term is defined
in the Investment Company Act of 1940, as amended), or from otherwise becoming
subject to regulation under the Investment Company Act of 1940.
Section 4.17 RULE 144A INFORMATION REQUIREMENT.
The Company shall furnish to the Holders of the Securities and
prospective purchasers of Securities designated by the Holders of Transfer
Restricted Securities, upon their request, the information required to be
delivered pursuant to Rule 144A(d)(4) under the Securities Act until such time
as either the Company has concluded an offer to exchange the Exchange Securities
for the Initial Securities or a registration statement relating to resales of
the Securities has become effective under the Securities Act. The Company shall
also furnish such information during the pendency of any suspension of
effectiveness of such resale registration statement.
Section 4.18 REPURCHASE OF SENIOR NOTES AT THE OPTION OF THE
HOLDER UPON A CHANGE OF CONTROL
In the event that a Change of Control has occurred, each holder of
Senior Notes will have the right, at such holder's option, pursuant to an
irrevocable and unconditional offer by the Company (the "Change of Control
Offer"), to require the Company to repurchase all or any part of such holder's
Senior Notes (provided that the principal amount at maturity of such Senior
Notes must be $1,000 (or such greater amount that results solely from an
increase in the Accretion Rate) or an integral multiple thereof) on a date (the
"Change of Control Purchase Date") that is no later than 40 Business Days after
60
the occurrence of such Change of Control, at a cash price equal to 101% of the
Accreted Value thereof at the Change of Control Purchase Date (the "Change of
Control Purchase Price"), together with accrued interest and Liquidated Damages,
if any, to the Change of Control Purchase Date. The Change of Control Offer
shall be made within 15 Business Days following a Change of Control and shall
remain open for 20 Business Days following its commencement (the "Change of
Control Offer Period").
ARTICLE V
SUCCESSORS
Section 5.1 LIMITATION ON MERGER, SALE OR CONSOLIDATION
The Company shall not consolidate with or merge with or into another
Person or, directly or indirectly, sell, lease, convey or transfer all or
substantially all of its assets (computed on a consolidated basis), whether in a
single transaction or a series of related transactions, to another Person or
group of affiliated Persons or adopt a Plan of Liquidation, unless (i) either
(a) the Company is the continuing entity or (b) the resulting, surviving or
transferee entity or, in the case of a Plan of Liquidation, the entity which
receives the greatest value from such Plan of Liquidation is a corporation
organized under the laws of the United States, any state thereof or the District
of Columbia and expressly assumes by supplemental indenture all of the
obligations of the Company in connection with the Senior Notes and the
Indenture; (ii) no Default or Event of Default shall exist or shall occur
immediately after giving effect on a pro forma basis to such transaction, and
(iii) immediately after giving effect to such transaction on a pro forma basis,
the consolidated resulting, surviving or transferee entity or, in the case of a
Plan of Liquidation, the entity which receives the greatest value from such Plan
of Liquidation would immediately thereafter have a Debt Incurrence Ratio (as
though such entity were the Company) no greater than the Company's Debt
Incurrence Ratio immediately prior to such transaction.
Section 5.2 SUCCESSOR CORPORATION SUBSTITUTED.
Upon any consolidation or merger or any transfer of all or
substantially all of the assets of the Company or consummation of a Plan of
Liquidation in accordance with the foregoing, the successor corporation formed
by such consolidation or into which the Company is merged or to which such
transfer is made or, in the case of a Plan of Liquidation, the entity which
61
receives the greatest value from such Plan of Liquidation shall succeed to, and
be (except in the case of a lease) substituted for, and may exercise every right
and power of, the Company under the Indenture with the same effect as if such
successor corporation had been named therein as the Company, and (except in the
case of a lease) the Company shall be released from the obligations under the
Senior Notes and the Indenture except with respect to any obligations that arise
from, or are related to, such transaction.
For purposes of the foregoing, the transfer (by lease, assignment, sale
or otherwise) of all or substantially all of the properties and assets of one or
more Subsidiaries or Restricted Affiliates, the Company's interest in which
constitutes all or substantially all of the properties and assets of the Company
shall be deemed to be the transfer of all or substantially all of the properties
and assets of the Company.
ARTICLE VI
DEFAULTS AND REMEDIES
Section 6.1 EVENTS OF DEFAULT.
An "Event of Default" occurs if:
(a) the Company defaults in the payment of any installment of
interest when due and the continuance of such default for 30 days;
(b) the Company defaults in the payment when due of the principal, or
Accreted Value (as applicable), or premium of the Securities, at maturity, upon
acceleration, repurchase or otherwise;
(c) the Company fails to comply with any of the provisions of Section
4.7, 4.9, 4.10, 4.15, 4.18. or 5.1 hereof;
(d) the Company fails to observe or perform any other covenant,
representation, warranty or other agreement in this Indenture or the Securities
for 60 days after notice to the Company by the Trustee or notice to the Company
and the Trustee by the Holders of at least 25% in principal amount at maturity
of the Securities then outstanding;
(e) a default occurs under any mortgage, indenture or instrument under
which there may be issued or by which there may be secured or evidenced any
Indebtedness for money borrowed by the Company or any of its Subsidiaries (or
62
the payment of which is guaranteed by the Company or any of its Subsidiaries),
whether such Indebtedness or guarantee now exists, or is created after the date
of this Indenture, which default (i) is caused by a failure to pay principal of
or premium, if any, or interest on such Indebtedness prior to the expiration of
the grace period provided in such Indebtedness on the date of such default (a
"Payment Default") or (ii) results in the acceleration of such Indebtedness
prior to its express maturity and, in each case, the principal amount of such
Indebtedness, together with the principal amount of any other such Indebtedness
under which there has been a Payment Default or the maturity of which has been
so accelerated aggregates $10 million or more;
(f) a final judgment or final judgments for the payment of money are
entered by a court or courts of competent jurisdiction against the Company or
any of its Subsidiaries and such judgment or judgments are not paid, discharged
or stayed for a period of 60 days, provided that the aggregate of all such
undischarged judgments exceeds $10 million;
(g) the Company or any of its Significant Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary
pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case,
(ii) consents to the entry of an order for relief
against it in an involuntary case,
(iii) consents to the appointment of a Custo ▇▇▇▇ of
it or for all or substantially all of its property,
(iv) makes a general assignment for the benefit of
its creditors, or
(v) generally is not paying its debts as they
become due; or
(h) a court of competent jurisdiction enters an order or decree under
any Bankruptcy Law that:
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(i) is for relief against the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary in an involuntary
case;
(ii) appoints a Custodian of the Company or any of
its Significant Subsidiaries or any group of Subsidiaries that, taken
as a whole, would constitute a Significant Subsidiary for all or
substantially all of the property of the Company or any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary; or
(iii) orders the liquidation of the Company or any of
its Significant Subsidiaries or any group of Subsidiaries that, taken
as a whole, would constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60
consecutive days.
Section 6.2 ACCELERATION.
If any Event of Default (other than an Event of Default specified in
clause (g) or (h) of Section 6.1 hereof with respect to the Company, any
Significant Subsidiary or any group of Significant Subsidiaries that, taken as a
whole, would constitute a Significant Subsidiary) occurs and is continuing,
unless the principal of all of the Senior Notes shall have already become due
and payable, the Trustee or the Holders of at least 25% in principal amount at
maturity of the then outstanding Securities by notice in writing to the Company
(and to the Trustee if given by Holders) (an "Acceleration Notice") may declare
all Accreted Value, accrued interest and Liquidated Damages, if any, thereon the
Securities to be due and payable immediately. Upon any such declaration, the
Accreted Value of the Securities shall become due and payable immediately.
Notwithstanding the foregoing, if an Event of Default specified in clause (g) or
(h) of Section 6.1 hereof occurs with respect to the Company, any of its
Significant Subsidiaries or any group of Subsidiaries that, taken as a whole,
would constitute a Significant Subsidiary all Accreted Value, accrued interest
and Liquidated Damages, if any, thereon shall be due and payable immediately
without further action or notice. The Holders of a majority in aggregate
principal amount at maturity of the then outstanding Securities by written
notice to the Trustee may on behalf of all of the Holders rescind an
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acceleration and its consequences if the rescission would conflict with any
judgment or decree and if all existing Events of Default (except nonpayment of
principal, interest, or premium or Liquidated Damages, if any, that has become
due solely because of the acceleration and except on default with respect to any
provision requiring a super-majority approval to amend, which default may only
be waived by such a super-majority) have been cured or waived. Except as
provided below in the following paragraph, in the event of any such acceleration
of Securities, the Company will become obligated to pay the Accreted Value, plus
all applicable premiums, accrued interest and Liquidated Damages, of the Senior
Notes immediately.
The Holders of a majority in aggregate principal amount at maturity of
the Senior Notes at any time outstanding may waive on behalf of all the Holders
any default, except a default with respect to any provision requiring a
super-majority approval to amend, which default may only be waived by such a
super-majority, and except a default in the payment of principal of, Accreted
Value, or interest or Liquidated Damages on any Senior Note not yet cured or a
default with respect to any covenant or provision which cannot be modified or
amended without the consent of the Holder of each outstanding Senior Note
affected. Subject to Article 7, the Trustee will be under no obligation to
exercise any of its rights or powers under the Indenture at the request, order
or direction of any of the Holders, unless such Holders have offered to the
Trustee reasonable security or indemnity. Subject to all provisions of the
Indenture and applicable law, the Holders of a majority in aggregate principal
amount of the Senior Notes at the time outstanding will have the right to 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 the Trustee.
Section 6.3 OTHER REMEDIES.
If an Event of Default occurs and is continuing, the Trustee may pursue
any available remedy to collect the payment of principal, Accreted Value, and
premium, and accrued interest and Liquidated Damages, if any, on the Securities
or to enforce the performance of any provision of the Securities or this
Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Securities or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder of a Security 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.
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Section 6.4 WAIVER OF PAST DEFAULTS.
Holders of not less than a majority in aggregate principal amount at
maturity of the then outstanding Securities by notice to the Trustee may on
behalf of the Holders of all of the Securities waive an existing Default or
Event of Default and its consequences hereunder, except a continuing Default or
Event of Default in the payment of the principal of, Accreted Value, or premium,
and accrued interest and Liquidated Damages, if any, on the Securities (which is
required to be unanimous), and except in connection with a Repurchase Offer
(which requires at least 66.67% in principal amount at maturity of the then
outstanding Securities). 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 6.5 CONTROL BY MAJORITY.
Holders of a majority in principal amount at maturity of the then
outstanding Securities may direct the time, method and place of conducting any
proceeding for exercising any remedy available to the Trustee or exercising any
trust or power conferred on it. However, the Trustee may refuse to follow any
direction that conflicts with law or this Indenture that the Trustee determines
may be unduly prejudicial to the rights of other Holders of Securities or that
may involve the Trustee in personal liability.
Section 6.6 LIMITATION ON SUITS.
A Holder of a Security may pursue a remedy with respect to this
Indenture or the Securities only if:
(a) the Holder of a Security gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in principal amount at maturity of the
then outstanding Securities make a written request to the Trustee to pursue the
remedy;
(c) such Holder of a Security or Holders of Securities offer and, if
requested, provide to the Trustee indemnity satisfactory to the Trustee against
any loss, liability or expense;
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(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in principal
amount at maturity of the then outstanding Securities do not give the Trustee a
direction inconsistent with the request.
Section 6.7 RIGHTS OF HOLDERS OF SECURITIES TO RECEIVE PAYMENT.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Security to receive payment of principal, Accreted Value, and
premium, and interest and Liquidated Damages, if any, on the Security, on or
after the respective due dates expressed in the Security (including in
connection with a Repurchase Offer or in respect of the redemption thereof), or
to bring suit for the enforcement of any such payment on or after such
respective dates, shall not be impaired or affected without the consent of such
Holder.
Section 6.8 COLLECTION SUIT BY TRUSTEE.
If an Event of Default specified in Section 6.1 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 for the whole amount of
principal of, and premium, if any, remaining unpaid on the Securities and
interest on overdue principal and such other 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 6.9 TRUSTEE MAY FILE PROOFS OF CLAIM.
The Trustee is authorized to file such proofs of claim and other papers
or documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Securities allowed in any judicial proceedings relative to the
Company (or any other obligor upon the Securities), its creditors or its
property 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
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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 7.7 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 7.7
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 that
the Holders 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 or the rights of any Holder,
or to authorize the Trustee to vote in respect of the claim of any Holder in any
such proceeding.
Section 6.10 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, its agents and attorneys for
amounts due under Section 7.7 hereof, including payment of all
compensation, expense and liabilities incurred, and all
advances made, by the Trustee and the costs and expenses of
collection;
Second: to Holders of Securities for amounts due and unpaid on
the Securities for principal, Accreted Value, and premium, and interest
and Liquidated Damages, if any, ratably, without preference or priority
of any kind, according to the amounts due and payable on the Securities
for principal, Accreted Value, and premium, and interest and Liquidated
Damages, if any, respectively; and
Third: to the Company or to such party as a court of competent
jurisdiction shall direct.
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The Trustee may fix a record date and payment date for any payment to
Holders of Securities pursuant to this Section 6.10.
Section 6.11 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 of a
Security pursuant to Section 6.7 hereof, or a suit by Holders of more than 10%
in principal amount at maturity of the then outstanding Securities.
ARTICLE VII
TRUSTEE
Section 7.1 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 its 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:
(i) the duties of the Trustee shall be deter mined
solely by the express provisions of this Indenture and 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
(ii) in the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the statements and
the correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, the Trustee shall examine the certificates and
opinions to determine whether or not they conform to the requirements
of this Indenture.
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(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:
(i) this paragraph does not limit the effect of
paragraph (b) of this Section 7.1;
(ii) the Trustee shall not be liable for any error of
judgment made in good faith by a Responsible Officer, unless it is
proved that the Trustee was negligent in ascertaining the pertinent
facts; and
(iii) the Trustee shall not be liable with respect to
any action it takes or omits to take in good faith in accordance
with a direction received by it pursuant to Section 6.5 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 7.1.
(e) No provision of this Indenture shall require the Trustee to expend
or risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holders shall have offered to the Trustee
security and indemnity 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.
(g) Except with respect to Sections 4.1 and 4.4 hereof, the Trustee
shall have no duty to inquire as to the performance of the Company's covenants
in Article 4 hereof. In addition, the Trustee shall not be deemed to have
knowledge of any Default or Event of Default except (i) any Event of Default
occurring pursuant to Sections 4.1, 4.4 and 6.1 hereof or (ii) any Default or
Event of Default of which the Trustee shall have received written notification
or obtained actual knowledge.
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Section 7.2 RIGHTS OF TRUSTEE.
(a) The Trustee may conclusively rely upon 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 from liability 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 its attorneys and 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 that it believes to be authorized or within the 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 shall be sufficient if
signed by an Officer of the Company.
(f) The Trustee shall be under no obligation to exercise any of the
rights or powers vested in it by this Indenture at the request or direction of
any of the Holders unless such Holders shall have offered to the Trustee
reasonable security or indemnity against the costs, expenses and liabilities
that might be incurred by it in compliance with such request or direction.
Section 7.3 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities and may otherwise deal with the Company or any
Affiliate of the Company with the same rights it would have if it were not
Trustee. However, in the event that the Trustee acquires any conflicting
interest it must eliminate such conflict within 90 days, apply to the SEC for
permission to continue as trustee or resign. Any Agent may do the same with like
rights and duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.
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Section 7.4 TRUSTEE'S DISCLAIMER.
The Trustee shall not be responsible for and makes no representations
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 of
this Indenture, 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 or any other document in connection with the sale of the Securities
or pursuant to this Indenture other than its certificate of authentication.
Section 7.5 NOTICE OF DEFAULTS.
The Trustee shall mail to Holders of Securities 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, on
any Security, the Trustee may withhold the notice if and so long as a committee
of its Responsible Officers in good faith determines that withholding the notice
is in the interests of the Holders of the Securities.
Section 7.6 REPORTS BY TRUSTEE TO HOLDERS OF THE SECURITIES.
Within 60 days after each May 15 beginning with the May 15 following
the date of this Indenture, and for so long as Securities remain outstanding,
the Trustee shall mail to the Holders of the Securities a brief report dated as
of such reporting date that complies with TIA ss. 313(a) (but if no event
described in TIA ss. 313(a) has occurred within the twelve months preceding the
reporting date, no report need be transmitted). The Trustee also shall comply
with TIA ss. 313(b)(2). The Trustee shall also transmit by mail all reports as
required by TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders of
Securities shall be mailed to the Company and filed with the SEC and each stock
exchange on which the Securities are listed in accordance with TIA ss. 313(d).
The Company shall promptly notify the Trustee when the Securities are listed on
any stock exchange.
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Section 7.7 COMPENSATION AND INDEMNITY.
The Company shall 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 shall reimburse the Trustee promptly
upon request for all reasonable disbursements, advances and expenses incurred or
made by it in addition to the compensation for its services. Such expenses shall
include the reasonable compensation, disbursements and expenses of the Trustee's
agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities or expenses incurred by it arising out of or in connection with the
acceptance or administration of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against the Company (including
this Section 7.7) and defending itself against any claim (whether asserted by
the Company or any Holder or any other person) or liability in connection with
the exercise or performance of any of its powers or duties hereunder, except to
the extent any such loss, liability or expense may be attributable to its
negligence or bad faith. The Trustee shall notify the Company promptly of any
claim for which it may seek indemnity. Failure by the Trustee so to notify the
Company shall not relieve the Company of its obligations hereunder. The Company
shall defend the claim and the Trustee shall cooperate in the defense. The
Trustee may have separate counsel and, the Company shall pay the reasonable fees
and expenses of such counsel. The Company need not pay for any settlement made
without its consent, which consent shall not be unreasonably withheld.
The obligations of the Company under this Section 7.7 shall survive the
satisfaction and discharge of this Indenture.
To secure the Company's payment obligations in this Section 7.7, 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 and
interest on particular 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 6.1(g) or (h) hereof occurs, the expenses and the
compensation for the services (including the fees and expenses of its agents and
counsel) are intended to constitute expenses of administration under any
Bankruptcy Law.
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The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to
the extent applicable.
Section 7.8 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 7.8.
The Trustee may resign in writing at any time and be discharged from
the trust hereby created by so noticing the Company. The Holders of Securities
of a majority in principal amount at maturity of the then outstanding Securities
may remove the Trustee by so notifying the Trustee and the Company in writing.
The Company may remove the Trustee if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) 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;
(c) a Custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee 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 shall promptly appoint a successor
Trustee. Within one year after the successor Trustee takes office, the Holders
of a majority in principal amount at maturity of the then outstanding Securities
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 Securities of at least 10% in principal amount at maturity of the
then outstanding Securities may petition any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Senior Note
who has been a Holder of a Senior Note for at least six months, fails to comply
with Section 7.10, such Holder of a Senior Note may petition any court of
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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. 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 of the Securities. The retiring Trustee shall promptly
transfer all property held by it as Trustee to the successor Trustee, provided
all sums owing to the Trustee hereunder have been paid and subject to the Lien
provided for in Section 7.7 hereof. Notwithstanding replacement of the Trustee
pursuant to this Section 7.8, the Company's obligations under Section 7.7 hereof
shall continue for the benefit of the retiring Trustee.
Section 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC.
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 if otherwise eligible hereunder without any further
act shall be the successor Trustee.
Section 7.10 ELIGIBILITY; DISQUALIFICATION.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee who satisfies the
requirements of TIA ss. 310(a)( l), (2) and (5). The Trustee is subject to TIA
ss.310(b).
Section 7.11. PREFERENTIAL COLLECTION OF CLAIMS AGAINST COM PANY.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee who has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
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ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.1 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT DEFEASANCE.
The Company may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time prior to the
Stated Maturity, elect to have either Section 8.2 or 8.3 hereof be applied to
all outstanding Securities upon compliance with the conditions set forth below
in this Article Eight.
Section 8.2 LEGAL DEFEASANCE AND DISCHARGE.
Upon the Company's exercise under Section 8.1 hereof of the option
applicable to this Section 8.2, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.4 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Securities on
the date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Company shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Securities, which shall thereafter be deemed to be "outstanding"
only for the purposes of Section 8.5 hereof and the other Sections of this
Indenture referred to in (a) and (b) below, and to have satisfied all its other
obligations under such Securities and this Indenture (and the Trustee, on demand
of and at the expense of the Company, shall execute proper instruments
acknowledging the same), except for the following provisions which shall survive
until otherwise terminated or discharged hereunder: (a) the rights of Holders of
outstanding Securities to receive solely from the trust fund described in
Section 8.4 hereof, and as more fully set forth in such Section, payments in
respect of the principal of, and premium, and interest and Liquidated Damages,
if any, on such Securities when such payments are due from the funds held by the
Trustee in the trust, (b) the Company's obligations with respect to such
Securities under Article 2 and Section 4.2 hereof, (c) the rights, powers,
trusts, duties and immunities of the Trustee hereunder and the Company's
obligations in connection therewith and (d) this Article Eight. Subject to
compliance with this Article Eight, the Company may exercise its option under
this Section 8.2 notwithstanding the prior exercise of its option under Section
8.3 hereof.
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Section 8.3 COVENANT DEFEASANCE.
Upon the Company's exercise under Section 8.1 hereof of the option
applicable to this Section 8.3, the Company shall, subject to the satisfaction
of the conditions set forth in Section 8.4 hereof, be released from its
obligations under the covenants contained in Sections 4.7, 4.8, 4.9, 4.10, 4.11,
4.12, 4.13, 4.15, 4.16, 4.17 and 4.18 hereof with respect to the outstanding
Securities on and after the date the conditions set forth below are satisfied
(hereinafter, "Covenant Defeasance"), and the Securities shall thereafter be
deemed not "outstanding" for the purposes of any direction, waiver, consent or
declaration or act of Holders (and the consequences of any thereof) in
connection with such covenants, but shall continue to be deemed "outstanding"
for all other purposes hereunder. For this purpose, Covenant Defeasance means
that, with respect to the outstanding Securities, the Company may omit to comply
with and shall have no liability in respect of any term, condition or limitation
set forth in any such covenant, whether directly or indirectly, by reason of any
reference elsewhere herein to any such covenant or by reason of any reference in
any such covenant to any other provision herein or in any other document and
such omission to comply shall not constitute a Default or an Event of Default
under Section 6.1 hereof, but, except as specified above, the remainder of this
Indenture and such Securities shall be unaffected thereby. In addition, upon the
Company's exercise under Section 8.1 hereof of the option applicable to this
Section 8.3 hereof, subject to the satisfaction of the conditions set forth in
Section 8.4 hereof, Sections 6.1(c) through 6.1(f) hereof shall not constitute
Events of Default.
Section 8.4 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.2 or 8.3 hereof to the outstanding Securities:
In order to exercise either Legal Defeasance or Covenant Defeasance the
Company shall have received a Purchaser Resale Notice and:
(a) the Company must irrevocably deposit with the Trustee, in trust,
for the benefit of the Holders, U.S. legal tender, U.S. Government Securities,
or a combination thereof, in such amounts as will be sufficient, in the opinion
of a nationally recognized firm of independent public accountants, to pay the
principal of, premium, if any, and interest on such Senior Notes on the stated
date for payment thereof or on the redemption date of such principal or
installment of principal of, premium, if any, or interest on such Senior Notes,
and the holders of Senior Notes must have a valid, perfected, exclusive security
interest in such trust;
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(b) in the case of an election under Section 8.2 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (A) the Company has
received from, or there has been published by, the Internal Revenue Service a
ruling or (B) since the date of this Indenture, there has been a change in the
applicable Federal income tax law, in either case to the effect that, and based
thereon such Opinion of Counsel shall confirm that, the Holders of the
outstanding Securities will not recognize income, gain or loss for Federal
income tax purposes as a result of such Legal Defeasance and will be subject to
Federal income tax on the same amounts, in the same manner and at the same time
as would have been the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.3 hereof, the Company
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Securities will not recognize income, gain or loss for Federal
income tax purposes as a result of such Covenant Defeasance and will be subject
to Federal income tax on the same amounts, in the same manner and at the same
times as would have been the case if such Covenant Defeasance had not occurred;
(d) no Default or Event of Default shall have occurred and be
continuing on the date of such deposit (other than a Default or Event of Default
resulting from the incurrence of Indebtedness all or a portion of the proceeds
of which will be used to defease the Securities pursuant to this Article Eight
concurrently with such incurrence) or insofar as Sections 6.1(g) or 6.1(h)
hereof is concerned, at any time in the period ending on the 91st day after the
date of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument to which the Company or any of its Subsidiaries is a party or by
which the Company or any of its Subsidiaries is bound;
(f) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit was not made by the Company with the intent
of preferring the Holders over any other creditors of the Company or with the
intent of defeating, hindering, delaying or defrauding any other creditors of
the Company; and
(g) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for in, in the case of the Officers' Certificate, (a) through
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(d) and, in the case of an Opinion of Counsel, clauses (a) (with respect to the
validity and perfection of the security interest), (b), (c) and (e) of this
paragraph have been complied with.
Section 8.5 DEPOSITED MONEY AND GOVERNMENT SECURITIES TO BE HELD IN TRUST;
OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.6 hereof, all money and non-callable Government
Securities (including the proceeds thereof) deposited with the Trustee (or other
qualifying trustee, collectively for purposes of this Section 8.5, the
"Trustee") pursuant to Section 8.4 hereof in respect of the outstanding
Securities shall be held in trust and applied by the Trustee, in accordance with
the provisions of such Securities and this Indenture, to the payment, either
directly or through any Paying Agent (including the Company acting as Paying
Agent) as the Trustee may determine, to the Holders of such Securities of all
sums due and to become due thereon in respect of principal, premium, if any, and
interest and Liquidated Damages, but such money need not be segregated from
other funds except to the extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or non-callable Government
Securities deposited pursuant to Section 8.4 hereof or the principal and
interest received in respect thereof other than any such tax, fee or other
charge which by law is for the account of the Holders of the outstanding
Securities.
Anything in this Article Eight to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the request
of the Company any money or non-callable Government Securities held by it as
provided in Section 8.4 hereof which, in the opinion of a nationally recognized
firm of independent public accountants expressed in a written certification
thereof delivered to the Trustee (which may be the opinion delivered under
Section 8.4(a) hereof), are in excess of the amount thereof that would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
Section 8.6 REPAYMENT TO COMPANY.
Any money deposited with the Trustee or any Paying Agent, or then held
by the Company, in trust for the payment of the principal of, or premium, if
any, on any Security and remaining unclaimed for two years after such principal,
and premium, if any, has become due and payable shall be paid to the Company on
its request or (if then held by the Company) shall be discharged from such
trust; and the Holder of such Security shall thereafter, as a secured creditor,
79
look only to the Company for payment thereof, and all liability of the Trustee
or such Paying Agent with respect to such trust money, and all liability of the
Company as trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such Paying Agent, before being required to make any such repayment
may at the expense of the Company cause to be published once, in the New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
Section 8.7 REINSTATEMENT.
If the Trustee or Paying Agent is unable to apply any United States
dollars or non-callable Government Securities in accordance with Section 8.2 or
8.3 hereof, as the case may be, by reason of any order or judgment of any court
or governmental authority enjoining, restraining or otherwise prohibiting such
application, then the Company's obligations under this Indenture and the
Securities shall be revived and reinstated as though no deposit had occurred
pursuant to Section 8.2 or 8.3 hereof until such time as the Trustee or Paying
Agent is permitted to apply all such money in accordance with Section 8.2 or 8.3
hereof, as the case may be; provided, however, that, if the Company makes any
payment of principal of, premium, if any, or interest on any Security following
the reinstatement of its obligations, the Company shall be subrogated to the
rights of the Holders of such Securities to receive such payment from the money
held by the Trustee or Paying Agent.
ARTICLE IX
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.1 WITHOUT CONSENT OF HOLDERS OF SECURITIES.
Notwithstanding Section 9.2 of this Indenture, the Company and the
Trustee may amend or supplement this Indenture or the Securities without the
consent of any Holder of a Security:
(a) to cure any ambiguity, defect or inconsistency;
80
(b) to provide for uncertificated Securities in addition to or in place
of certificated Securities;
(c) to provide for the assumption of the Company's obligations to the
Holders of the Securities in the case of a merger, consolidation or sale of all
or substantially all of the Company's assets pursuant to Article Five hereof;
(d) to make any change that would provide any additional rights or
benefits to the Holders of the Securities or that does not adversely affect the
legal rights hereunder of any Holder of the Securities;
(e) to comply with requirements of the SEC in order to effect or
maintain the qualification of this Indenture under the TIA;
(f) to change the name of the Securities.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon receipt by the Trustee of the documents described in Section
7.2 hereof, the Trustee shall join with the Company in the execution of any
amended or supplemental Indenture authorized or permitted by the terms of this
Indenture and to make any further appropriate Agreements and stipulations that
may be therein contained, but the Trustee shall not be obligated to enter into
such amended or supplemental Indenture that affects its own rights, duties or
immunities under this Indenture or otherwise.
Section 9.2 WITH CONSENT OF HOLDERS OF SECURITIES.
Except as provided below in this Section 9.2, the Company and the
Trustee may amend or supplement this Indenture and the Securities may be amended
or supplemented with the consent of the Holders of at least a majority in
principal amount at maturity of the Securities then outstanding (including
consents obtained in connection with a tender offer or exchange offer for the
Securities), and, subject to Sections 6.4 and 6.7 hereof, any existing Default
or Event of Default (other than a Default or Event of Default in the payment of
the principal of, Accreted Value, or premium, interest or Liquidated Damages, if
any, on the Securities, except a payment default resulting from an acceleration
that has been rescinded) or compliance with any provision of this Indenture or
the Securities may be waived with the consent of the Holders of a majority in
principal amount at maturity of the then outstanding Securities (including
consents obtained in connection with a tender offer or exchange offer for the
81
Securities). Notwithstanding the foregoing, without the consent of at least
66-2/3% in principal amount at maturity of the Securities then outstanding
(including consents obtained in connection with a tender offer or exchange offer
for such Securities), no waiver or amendment to this Indenture may make any
change in the provisions of Section 4.18 hereof (including by way of an
amendment to any of the definitions used in any such provisions) that adversely
affects the rights of any Holder of Securities.
Upon the request of the Company accompanied by a resolution of its
Board of Directors authorizing the execution of any such amended or supplemental
Indenture, and upon the filing with the Trustee of evidence satisfactory to the
Trustee of the consent of the Holders of Securities as aforesaid, and upon
receipt by the Trustee of the documents described in Section 7.2 hereof, the
Trustee shall join with the Company in the execution of such amended or
supplemental Indenture unless such amended or supplemental Indenture affects the
Trustee's own rights, duties or immunities under this Indenture or otherwise, in
which case the Trustee may in its discretion, but shall not be obligated to,
enter into such amended or supplemental Indenture.
It shall not be necessary for the consent of the Holders of Securities
under this Section 9.2 to approve the particular form of any proposed amendment
or waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders of Securities 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 amended or supplemental
Indenture or waiver. Subject to Sections 6.4 and 6.7 hereof, the Holders of a
majority in aggregate principal amount at maturity of the Securities then
outstanding may waive compliance in a particular instance by the Company with
any provision of this Indenture or the Securities. However, without the consent
of each Holder affected, an amendment or waiver may not (with respect to any
Securities held by a non-consenting Holder):
(a) reduce the principal amount at maturity of Securities whose Holders
must consent to an amendment, supplement or waiver;
(b) reduce the principal of, or premium, or change the fixed maturity
of any Security or alter or waive any of the provisions with respect to the
82
repurchase of the Securities, except as provided above with respect to Sections
4.18 hereof;
(c) reduce the rate of accretion of Accreted Value or interest on any
Security, or the Asset Sale Offer Price or the Change of Control Purchase Price,
or extend the time for payment of any interest;
(d) waive a Default or Event of Default in the payment of principal of,
Accreted value, interest, Liquidated Damages or premium, if any, on the
Securities;
(e) make any Security payable in money other than that stated in the
Securities, or change the place of payment where any Senior Note or any premium
or the interest, if any, thereon is payable;
(f) make any change in the provisions of this Indenture relating to
waivers of past Defaults or the rights of Holders of Securities to receive
payments of principal of, Accreted Value, interest, Liquidated Damages or
premium, if any, on the Securities;
(g) make any change in Section 6.4 or 6.7 hereof or in the foregoing
amendment and waiver provisions;
(h) cause the Senior Notes to become subordinated in right of payment
to any other Indebtedness.
Section 9.3 COMPLIANCE WITH TRUST INDENTURE ACT.
Every amendment or supplement to this Indenture or the Securities shall
be set forth in an amended or supplemental Indenture that complies with the TIA
as then in effect.
Section 9.4 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, supplement or waiver becomes effective, a consent
to it by a Holder of a Security is a continuing consent by the Holder of a
Security and every subsequent Holder of a Security or portion of a Security 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 of a Security
or subsequent Holder of a Security may revoke the consent as to its Security if
the Trustee receives written notice of revocation before the date the waiver,
supplement or amendment becomes effective. An amendment, supplement or waiver
83
becomes effective in accordance with its terms and thereafter binds every
Holder.
Section 9.5 NOTATION ON OR EXCHANGE OF SECURITIES.
The Trustee may plan an appropriate notation about amendment,
supplement or waiver on any Security thereafter authenticated. The Company in
exchange for all Securities may issue and the Trustee shall authenticate new
Securities that reflect the amendment, supplement or waiver.
Failure to make the appropriate notation or issue a new Security shall
not affect the validity and effect of such amendment, supplement or waiver.
Section 9.6 TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article Nine if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Company
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.1) shall be fully
protected in relying upon, an Officer's Certificate and an Opinion of Counsel
stating that the execution of such amended or supplemental indenture is
authorized or permitted by this Indenture and that all conditions precedent have
been complied with.
ARTICLE X
MISCELLANEOUS
Section 10.1 TRUST INDENTURE ACT CONTROLS.
If any provision of this Indenture limits, qualifies or conflicts with
the duties imposed by TIA ss.318(c), the imposed duties shall control.
Section 10.2 NOTICES.
Any notice or communication by the Company or the Trustee to the others
is duly given if in writing and delivered in Person or mailed by first class
84
mail (registered or certified, return receipt requested), telex, telecopier or
overnight air courier guaranteeing next day delivery, to the others' address:
If to the Company:
United International Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
With a copy to:
Holme ▇▇▇▇▇▇▇ & ▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
If to the Trustee:
Firstar Bank of Minnesota, N.A.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇. ▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Department
The Company or the Trustee, by notice to the others may designate
additional or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) 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 answered back, if telexed; 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.
Any notice or communication to a Holder shall be mailed by first class
mail, certified or registered, return receipt requested, or by overnight air
courier guarantee ing next day delivery to its address shown on the register
85
kept by the Registrar. Any notice or communication shall also be so mailed to
any Person described in TIA ss. 313(c), to the extent required by the TIA.
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 mails a notice or communication to Holders, it shall
mail a copy to the Trustee and each Agent at the same time.
Section 10.3 COMMUNICATION BY HOLDERS OF SECURITIES WITH OTHER HOLDERS OF
SECURITIES.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders
with respect to their rights under this Indenture or the Securities. The
Company, the Trustee, the Registrar and anyone else shall have the protection of
TIA ss. 312(c).
Section 10.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Company to the Trustee to take
any action under this Indenture, the Company shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably
satisfactory to the Trustee (which shall include the statements set forth in
Section 10.5 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 satisfied; and
(b) an Opinion of Counsel in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 10.5
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
86
Section 10.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a condition
or covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss.314(a)(4)) shall comply with the provisions of TIA ss. 314(e)
and shall include:
(a) a statement that the Person making such certificate or opinion has
read such covenant or condition;
(b) 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;
(c) a statement that, in the opinion of such Person, he or she 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
satisfied; and
(d) a statement as to whether or not, in the opinion of such Person,
such condition or covenant has been satisfied.
Section 10.6 RULES BY TRUSTEE AND AGENTS.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 10.7 NO PERSONAL LIABILITY OF DIRECTORS, OFFICERS, EMPLOYEES AND
STOCKHOLDERS.
No past, present or future director, officer, employee or direct or
indirect stockholder of the Company, as such, shall have any liability for any
obligations of the Company under the Securities or this Indenture or for any
claim based on, in respect of, or by reason of, such obligations or their
creation. Each Holder by accepting a Security waives and releases all such
liability. The waiver and release are part of the consideration for issuance of
securities.
Section 10.8 GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED AND CONSTRUED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, INCLUDING WITHOUT LIMITATION
SECTION 5-1401 AND 5-1402 OF THE NEW YORK GENERAL OBLIGATIONS LAW AND NEW YORK
CIVIL PRACTICE LAWS AND RULES 327(b), AS APPLIED TO CONTRACTS MADE AND PERFORMED
87
WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.
THE COMPANY HEREBY IRREVOCABLY SUBMITS TO THE JURISDICTION OF ANY NEW YORK STATE
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL
COURT SITTING IN THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF
ANY SUIT, ACTION OR PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE AND
THE SECURITIES, AND IRREVOCABLY ACCEPTS FOR ITSELF AND IN RESPECT OF ITS
PROPERTY, GENERALLY AND UNCONDITIONALLY, JURISDICTION OF THE AFORESAID COURTS.
THE COMPANY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT THEY MAY EFFECTIVELY DO SO
UNDER APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION WHICH THEY MAY NOW OR
HEREAFTER HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING
BROUGHT IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING
HEREIN SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY HOLDER TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST THE COMPANY IN ANY OTHER JURISDICTION.
Section 10.9 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret any other indenture, loan
or debt agreement of the Company or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
Section 10.10 SUCCESSORS.
All Agreements of the Company in this Indenture and the
Securities shall bind its successors. All Agreements of the Trustee
in this Indenture shall bind its successors.
88
Section 10.11 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 10.12 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 10.13 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 of this Indenture and shall in
no way modify or restrict any of the terms or provisions hereof.
Section 10.14 REGISTRATION RIGHTS
Certain Holders of the Securities may be entitled to certain
registration rights with respect to the Securities pursuant to, and subject to
the terms of, the Registration Rights Agreement.
89
Dated as of April 29, 1999 UNITED INTERNATIONAL HOLDINGS, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: President
Attest: /s/ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------------- (SEAL)
Dated as of April 29, ▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ N.A.
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇ III
------------------------------------
Name: ▇▇▇▇▇ ▇▇▇▇▇▇ III
Title: Vice President
Attest:
-------------------------------- (SEAL)
90
EXHIBIT A
(Form of Senior Note)
Series A Senior Discount Note due 2009
No.____________________ $__________________________
CUSIP No. _____________
ISIN No. ______________
UNITED INTERNATIONAL HOLDINGS, INC. promises to pay to or its
registered assigns, the principal sum of ____________ Dollars ($ ), which
amount, except as described below, includes amortization of original issue
discount, on May 1, 2009.
Interest Payment Dates: May 1 and November 1
Record Dates: May 1 and November 1
Dated: ______________________________
UNITED INTERNATIONAL
HOLDINGS, INC.
By:__________________________________
Name:
Title:
By:__________________________________
Name:
Title:
(SEAL)
[Insert legend required by Section 1.1275-3 of the Treasury Regulations]
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
This is one of the
Securities described
in the within-mentioned
Indenture.
FIRSTAR BANK OF MINNESOTA N.A.
as Trustee
By:___________________________________
Authorized Signatory
Reference is made to the further provisions of this Security on the
reverse side, which will, for all purposes, have the same effect as if set forth
at this place.
UNITED INTERNATIONAL HOLDINGS, INC.
Series A Senior Discount Note due 2009
"THIS SENIOR NOTE (OR ITS PREDECESSOR) HAS NOT BEEN REGISTERED UNDER
THE U.S. SECURITIES ACT OF 1933, AS AMENDED (THE "SECURITIES ACT"), AND,
ACCORDINGLY, MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED WITHIN
THE UNITED STATES OR TO, OR FOR THE ACCOUNT OR BENEFIT OF, U.S. PERSONS, EXCEPT
AS SET FORTH IN THE SECOND SENTENCE HEREOF. BY ITS ACQUISITION HEREOF OR OF A
BENEFICIAL INTEREST HEREIN, THE HOLDER (1) REPRESENTS THAT (A) IT IS A
"QUALIFIED INSTITUTIONAL BUYER" (AS DEFINED IN RULE 144A UNDER THE SECURITIES
ACT) (A "QIB"), (B) IT IS ACQUIRING THIS NOTE IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, OR (C) AFTER THE COMPANY
HAS RECEIVED A "PURCHASE RESALE NOTICE" (AS DEFINED IN THE INDENTURE) IT IS AN
INSTITUTIONAL "ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(A)(1), (2), (3) OR
(7) OF REGULATION D UNDER THE SECURITIES ACT) (AN "IAI"), (2) AGREES THAT IT
WILL NOT RESELL OR OTHERWISE TRANSFER THIS NOTE, EXCEPT (A) TO THE COMPANY OR
ANY OF ITS SUBSIDIARIES, (B) TO A PERSON WHOM THE SELLER REASONABLY BELIEVES IS
A QIB PURCHASING FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QIB IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (C) IN AN OFFSHORE
TRANSACTION MEETING THE REQUIREMENTS OF RULE 903 OR RULE 904 OF THE SECURITIES
ACT, (D) AFTER THE COMPANY HAS RECEIVED A "PURCHASE RESALE NOTICE," IN A
TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, (E)
AFTER THE COMPANY HAS RECEIVED A "PURCHASE RESALE NOTICE," TO AN IAI THAT, PRIOR
TO SUCH TRANSFER, FURNISHES THE TRUSTEE WITH A SIGNED LETTER CONTAINING CERTAIN
REPRESENTATIONS AND AGREEMENTS RELATING TO THE TRANSFER OF THIS SENIOR NOTE (THE
FORM OF WHICH CAN BE OBTAINED FROM THE TRUSTEE) AND, IF SUCH TRANSFER IS IN
RESPECT OF AN AGGREGATE ACCRETED VALUE OF SENIOR NOTES LESS THAN $250,000, AN
OPINION OF COUNSEL ACCEPTABLE TO THE COMPANY THAT SUCH TRANSFER IS IN COMPLIANCE
WITH THE SECURITIES ACT, (F) AFTER THE COMPANY HAS RECEIVED A "PURCHASE RESALE
NOTICE," IN ACCORDANCE WITH ANOTHER EXEMPTIN FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (AND BASED UPON AN OPINION OF COUNSEL ACCEPTABLE TO THE
COMPANY) OR (G) PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH
CASE, IN ACCORDANCE WITH THE APPLICABLE SECURITIES LAWS OF ANY STATE OF THE
UNITED STATES OR ANY OTHER APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED
STATES OR ANY OTHER APPLICABLE JURISDICTION AND (3) AGREES THAT IT WILL DELIVER
TO EACH PERSON TO WHOM THIS SENIOR NOTE OR AN INTEREST HEREIN IS TRANSFERRED A
NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS LEGEND. AS USED HEREIN, THE TERMS
"OFFSHORE TRANSACTION" AND "UNITED STATES" HAVE THE MEANINGS GIVEN TO THEM BY
RULE 902 OF REGULATION S UNDER THE SECURITIES ACT. THE INDENTURE CONTAINS A
PROVISION REQUIRING THE TRUSTEE TO REFUSE TO REGISTER ANY TRANSFER OF THIS
SENIOR NOTE IN VIOLATION OF THE FOREGOING."(1)
Capitalized terms used herein shall have the meanings assigned to them
in the Indenture referred to below, unless otherwise indicated.
1. METHOD OF PAYMENT. The initial Accreted Value will increase at the
rate of 10.875% per annum, compounded semi-annually, on the Senior Notes. From
and after the Market Spread Date, if any, the Accreted Value of the Notes will
increase at the Accretion Rate, compounded semi-annually, until the final
maturity thereof. PAYMENT OF THE PRINCIPAL OF, OR PREMIUM, IF ANY, ON THE SENIOR
NOTES OR SUCH OTHER AMOUNT PAYABLE UPON THE ACCELERATION OF THE MATURITY OF THE
SENIOR NOTES WILL INCLUDE ACCRUED AMORTIZATION OF ORIGINAL ISSUE DISCOUNT, AND,
THEREFORE, THE PRINCIPAL AMOUNT (INCLUDING AMORTIZATION OF ORIGINAL ISSUE
DISCOUNT) DUE ON THIS NOTE COULD EXCEED THE AMOUNT STATED IN THE FIRST PARAGRAPH
HEREOF. Interest payable in cash will commence to accrue on May 1, 2004, and
will be payable on each May 1 and November 1 thereafter until maturity
commencing November 1, 2004, to Holders of record on each immediately preceding
April 15 and October 15 (each, a "Record Date"). Interest will be paid upon
overdue principal and premium, and interest, if any, compounded semi-annually
from the due date at a rate equal to the then current Accretion Rate applicable
to the Notes to the extent such payment is lawful. All such interest will be
computed on the basis of a 360-day year of twelve 30-day months.
The Accretion Rate may vary as specified below, but shall be fixed at
the time the Senior Notes are first resold by the Initial Purchasers pursuant to
the terms of the Note Purchase Agreement. DLJSC on behalf of the Initial
Purchasers shall fix the Accretion Rate by written notice prior to or on the
Market Spread Date to the Company and the Trustee (the "Market Spread Notice").
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(1) This paragraph should only be added for the Transfer Restricted
Securities.
In no event shall the Accretion Rate on the Notes be greater than the Accretion
Rate as so fixed. Until the Accretion Rate is so fixed by the giving of such
notice, the initial Accretion Rate of the Senior Notes from the Issue Date until
the Market Spread Date shall be 10.875% per annum. The Accretion Rate from and
after the Market Spread Date shall be equal to the sum of (a) the Treasury Rates
(as defined below), plus (b) the spread over such treasury bond rate then
applicable to the Company's 10.75% Senior Secured Discount Notes due 2008 (the
"Reference Notes"), plus (c) 125 basis points, plus (d) the Additional Rate. The
Additional Rate shall initially be equal to zero (0) basis points and shall
increase by an additional 100 basis points on the last day of each six month
anniversary of the Issue Date (each such anniversary, or "Accretion Date"). The
Accretion Date on or next following the date that a Market Spread Notice shall
have been delivered shall be, the "Market Spread Date"). In the event that the
Reference Notes are not outstanding on the trading date immediately preceding
the Market Spread Date, or if for any other reason it shall be impossible to
calculate the Accretion Rate, the Accretion Rate shall be 18%. In no event shall
the Accretion Rate be greater than 18%.
"TREASURY RATE" means on any Market Spread Date the yield on a
hypothetical United States Treasury security with a Treasury constant maturity
matching the then remaining average life to maturity of the Senior Notes. The
hypothetical Treasury security is to be derived by referring to the Federal
Reserve Board's Statistical Release H.15 (519) (or its successor publication)
most recently available next preceding (by not more than 10 nor less than 5
Business Days) such Market Spread Date. If there is a Treasury constant maturity
listed in said Federal Reserve Release H.15 (519) with a maturity equal to the
then remaining average life to maturity of the Senior Notes then the yield on
such Treasury security shall be the Treasury Rate. If no such Treasury constant
maturity exists, then the yield on such Treasury security shall be linearly
interpolated from the yields on (a) the Treasury security with a constant
maturity closest to and greater than the then remaining average life to maturity
of the Senior Notes and (b) the Treasury security with a constant maturity
closest to and less than the then remaining average life to maturity of the
Senior Notes. If there shall be no Treasury security with a constant maturity
less than the then remaining average life to maturity of the Senior Notes, then
Treasury Rate shall mean the yield on the Treasury security with the shortest
Treasury constant maturity. If said Federal Reserve Release H.15 (519) or a
successor publication refers to no applicable yield on Treasury securities, then
the Treasury Rate shall be the Prime Rate in effect on the applicable Market
Spread Date.
The Holder must surrender this Senior Note to a Paying Agent to collect
payments other than cash interest. The principal of, Accreted Value, interest
and premium, if any, on the Senior Notes will be payable at the office or agency
of the Company maintained for such purpose within the City and State of New York
or, at the option of the Company, payment may be made by check mailed to the
Holders of the Senior Notes at their respective addresses set forth in the
register of Holders of Senior Notes. Until otherwise designated by the Company,
the Company's office or agency in New York will be the office of the Trustee
maintained for such purpose. All payments shall be in coin or currency of the
United States of America as at the time of payment is legal tender for payment
of public and private debts.
2. PAYING AGENT AND REGISTRAR. Initially, the Trustee will act as
Paying Agent and Registrar. The Company may change any Paying Agent or Registrar
or co-registrar without prior notice to any Holder. The Company may act in any
such capacity, except as set forth in the Indenture.
3. INDENTURE. The Company issued the Senior Notes under an Indenture
dated as of April 29, 1999 (the "Indenture") between the Company and the
Trustee. The terms of the Indenture 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 ▇▇.▇▇. 77aaa-77bbbb). The Senior Notes are
subject to all such terms, and Holders are referred to the Indenture and such
Act for a statement of such terms. The terms of the Indenture shall govern any
inconsistencies between the Indenture and the Senior Notes. The Senior Notes are
unsecured obligations of the Company, except to the extent provided in the
Indenture, limited to $355,000,000 in aggregate principal amount at maturity.
4. OPTIONAL REDEMPTION. Optional Redemption after the resale of all of
the Senior Notes by the Initial Purchasers. The Company will not have the right
to redeem any Senior Notes following the first resale of the Senior Notes by the
Initial Purchasers and prior to May 1, 2004, other than out of the Net Cash
Proceeds from (a) a Public Equity Offering or (b) an Asset Sale, as described in
the two immediately following paragraphs. The Senior Notes will be redeemable
for cash at the option of the Company, in whole or in part, at any time on or
after May 1, 2004, upon not less than 30 days nor more than 60 days notice to
each Holder of Senior Notes, at the redemption prices set forth below (expressed
as percentages of the then Accreted Value thereof) if redeemed during the
12-month period commencing May 1, of the years indicated below, together with,
if applicable, accrued and unpaid interest and Liquidated Damages, if any,
thereon to the Redemption Date. If applicable, the redemption prices set forth
below shall be adjusted proportionately to reflect the difference between
10.875% and the Accretion Rate at the time of redemption by multiplying the
redemption premium set forth below (I.E., the values by which the percentages
set forth below exceed 100%) by a fraction the numerator of which is the
Accretion Rate then in effect and the denominator of which is 10.875%.
YEAR PERCENTAGE
---- ----------
2004.......................... 105.438%
2005.......................... 103.625%
2006.......................... 101.813%
2007 and thereafter........... 100.000%
Until May 1, 2002, upon a Public Equity Offering, up to 35% of the
maximum aggregate principal amount at maturity of the Senior Notes issued at any
time on or after the Issue Date pursuant to the Indenture may be redeemed at the
option of the Company within 90 days of such Public Equity Offering, on not less
than 30 days, but not more than 60 days, notice to each Holder of the Senior
Notes to be redeemed, with cash from the Net Cash Proceeds of such Public Equity
Offering, at a Redemption Price equal to the Accretion Rate plus 100% (initially
110.875%) of the then Accreted Value thereof, together with accrued and unpaid
Liquidated Damages, if any, to the Redemption Date; provided, however, that
immediately following such redemption not less than 65% of the maximum aggregate
principal amount at maturity of the Senior Notes issued at any time on or after
the Issue Date pursuant to the Indenture remains outstanding.
In addition, until May 1, 2002, upon an Asset Sale, up to 35% of the
maximum aggregate principal amount at maturity of the Senior Notes issued at any
time on or after the Issue Date pursuant to the Indenture may be redeemed at the
option of the Company within 90 days of such Asset Sale, on not less than 30
days, but not nor more than 60 days, notice to each Holder of the Senior Notes
to be redeemed, with the Net Cash Proceeds from such Asset Sale, at a Redemption
Price equal to the Accretion Rate plus 100% (initially 110.875%) of the then
Accreted Value thereof, together with accrued and unpaid Liquidated Damages, if
provided, however, that immediately following such redemption not less than 65%
of the maximum aggregate principal amount at maturity of the Senior Notes issued
at any time on or after the Issue Date pursuant to the Indenture remains
outstanding.
In the case of a partial redemption, the Trustee shall select the
Senior Notes or portions thereof for redemption on a pro rata basis, by lot or
in such other manner it deems appropriate and fair. The Senior Notes may be
redeemed in part in multiples of $1,000 principal amount at maturity only (or
such higher principal amount at maturity resulting from any increase in the
Accretion Rate.
The Senior Notes will not have the benefit of any sinking fund.
Notice of any redemption will be sent, by first class mail, at least 30
days and not more than 60 days prior to the date fixed for redemption to the
Holder of each Senior Note to be redeemed to such Holder's last address as then
shown upon the registry books of the Registrar. Any notice which relates to a
Senior Note to be redeemed in part only must state the portion of the principal
amount at maturity equal to the unredeemed portion thereof and must state that
on and after the date of redemption, upon surrender of such Senior Note, a new
Senior Note or Senior Notes in a principal amount at maturity equal to the
unredeemed portion thereof will be issued. On and after the Redemption Date, the
Accreted Value will cease to increase and, if applicable, interest will cease to
accrue, with respect to the Senior Notes, or portions thereof, called for
redemption, unless the Company defaults in the payment thereof.
5. MANDATORY REDEMPTION.
The Company is not required to make mandatory redemption payments with
respect to the Senior Notes.
6. REPURCHASES AT OPTION OF HOLDER.
(a) If there is a Change of Control, the Company will be required to
make an offer (a "Change of Control Offer") to repurchase all or any part (equal
to $1,000 in principal amount at maturity or an integral multiple thereof) of
each Holder's Senior Notes at a purchase price in cash equal to 101% of the
Accreted Value thereof on the date of purchase plus, if applicable, accrued and
unpaid interest and Liquidated Damages. Within 10 days following any Change of
Control, the Company will mail a notice to each Holder setting forth the
procedures governing the Change of Control Offer as required by the Indenture.
Holders may elect to have all or a portion of their Senior Notes purchase by
completing the form entitled "Option of Holder to Elect Purchase" appearing
below.
(b) If the Company or a Subsidiary consummates any Asset Sale, when the
aggregate amount of Excess Proceeds exceeds $20 million, the Company will be
required to make an offer to all Holders of Senior Notes (an "Asset Sale Offer")
to purchase the maximum amount of Senior Notes and other pari passu Indebtedness
that may be purchased out of the Excess Proceeds, at an offer price in cash
equal to the Accreted Value thereof as of the date of purchase, plus, if
applicable, accrued and unpaid interest and Liquidated Damages in accordance
with the procedures set forth in the Indenture. Holders of Senior Notes that are
the subject of such an offer to purchase will receive an Asset Sale Offer from
the Company prior to any related purchase date and may elect to have all or a
portion of their Senior Notes purchased by completing the form entitled "Option
of Holder to Elect Purchase" appearing below.
7. DENOMINATIONS, TRANSFER, EXCHANGE. The Senior Notes are in
registered form without coupons in denominations of $1,000 and integral
multiples of $1,000 (or such higher amount required by any increase in the
Accretion Rate). The transfer of Senior Notes may be registered and Senior Notes
may be exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents and the Company may require a Holder to pay any taxes and
fees required by law or permitted by the Indenture.
8. PERSONS DEEMED OWNERS. The registered Holder of a Senior Note may be
treated as its owner for all purposes.
9. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to certain exceptions, the
Indenture or the Senior Notes may be amended or supplemented with the consent of
the Holders of at least a majority in principal amount at maturity of the then
outstanding Senior Notes, and any existing default or compliance with any
provision of the Indenture or the Senior Notes may be waived with the consent of
the Holders of a majority in principal amount at maturity of the then
outstanding Senior Notes. Without the consent of any Holder of a Senior Note,
the Indenture or the Senior Notes may be amended or supplemented to cure any
ambiguity, defect or inconsistency, to provide for uncertificated Senior Notes
in addition to or in place of certificated Senior Notes, to provide for the
assumption of the Company's obligations to Holders of the Senior Notes in case
of a merger, consolidation or sale of all or substantially all of the Company's
assets, to make any change that would provide any additional rights or benefits
to the Holders of the Senior Notes or that does not adversely affect the legal
rights under the Indenture of any such Holder, or to comply with the
requirements of the Commission in order to effect or maintain the qualification
of the Indenture under the Trust Indenture Act.
10. DEFAULTS AND REMEDIES. Events of Default include: (i) default in
payment when due of principal or Accreted Value (as applicable) of the Senior
Notes when the same becomes due and payable at maturity upon acceleration,
repurchase or otherwise, (ii) failure by the Company to comply with any of the
provisions of Sections 4.7, 4.9, 4.10, 4.15, 4.18 or 5.1 of the Indenture; (iii)
failure by the Company for 60 days after notice to the Company by the Trustee or
the Holders of at least 25% in principal amount at maturity of the Senior Notes
then outstanding to comply with certain other Agreements in the Indenture or the
Senior Notes; (iv) default under certain other Agreements relating to
Indebtedness of the Company which default results in the acceleration of such
Indebtedness prior to its express maturity; (v) certain final judgments for the
payment of money that remain undischarged for a period of 60 days; and (vi)
certain events of bankruptcy or insolvency with respect to the Company or any of
its Significant Subsidiaries. If any Event of Default occurs and is continuing,
the Trustee or the Holders of at least 25% in principal amount at maturity of
the then outstanding Senior Notes may declare all the Senior Notes to be due and
payable. Notwithstanding the foregoing, in the case of an Event of Default
arising from certain events of bankruptcy or insolvency, all outstanding Senior
Notes will become due and payable without further action or notice. Holders may
not enforce the Indenture or the Senior Notes, except as provided in the
Indenture. Subject to certain limitations, Holders of a majority in principal
amount at maturity of the then outstanding Senior Notes may direct the Trustee
in its exercise of any trust or power. The Trustee may withhold from Holders of
the Senior Notes notice of any continuing Default or Event of Default (except a
Default or Event of Default relating to the payment of principal, Accreted
Value, interest, or premium) if it determines that withholding notice is in
their interest. The Holder of a majority in aggregate principal amount at
maturity of the Senior Notes then outstanding by notice to the Trustee may on
behalf of the Holders of all of the Senior Notes waive any existing Default or
Event of Default and its consequences under the Indenture except a continuing
Default or Event of Default in the payment of principal of, Accreted Value,
interest or premium, if any, on the Senior Notes and except in connection with a
Repurchase Offer or other redemption. The Company is required to deliver to the
Trustee annually a statement regarding compliance with the Indenture, and the
Company is required upon becoming aware of any Default or Event of Default, to
deliver to the Trustee a statement specifying such Default or Event of Default.
11. TRUSTEE DEALINGS WITH COMPANY. The Trustee, in its individual or
any other capacity, may make loans to, accept deposits from, and perform
services for the Company or its Affiliates, and may otherwise deal with the
Company or its Affiliates, as if it were not the Trustee.
12. NO RECOURSE AGAINST OTHERS. A director, officer, employee or direct
or indirect stockholder of the Company, as such, shall not have any liability
for any obligations of the Company under the Senior Notes 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 Senior Note waives and releases such
persons from all such liability.
13. AUTHENTICATION. This Senior Note shall not be valid until
authenticated by the manual signature of the Trustee or an authenticating
agent.
14. 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).
15. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the
Committee on Uniform Security Identification Procedures, the Company will cause
CUSIP numbers to be printed on the Senior Notes and the Trustee may use CUSIP
numbers in notices of redemption as a convenience to Holders. No representation
is made as to the accuracy of such numbers either as printed on the Senior Notes
or as contained in any notice of redemption and reliance may be placed only on
the other identification numbers placed thereon.
16. ADDITIONAL RIGHTS OF HOLDERS OF TRANSFER RESTRICTED SECURITIES.(2)
In addition to the rights provided to holders of Securities under the Indenture,
Holders of Securities shall have all the rights set forth in the Registration
Rights Agreement.
The Company will furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
United International Holdings, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Chief Financial Officer
-----------------
(2) This paragraph should be included only for the initial securities.
ASSIGNMENT FORM
To assign this Senior Note, fill in the form below: (I) or (we) assign and
transfer this Senior Note to
--------------------------------------------------------------------------------
(Insert assignee's soc. sec. or tax I.D. no.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint ___________________________________ to transfer this
Senior Note on the books of the Company. The agent may substitute another to act
for him.
Date: __________________
Your Signature:
----------------------------------------------------------------
(Sign exactly as your name appears on the face of this
Declaration)
Signature Guarantee:
NOTICE: The Signature must be guaranteed by an Institution which is a member of
one of the following recognized signature Guarantee Programs: (i) The Securities
Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange
Medallion Program (MNSP); (iii) The Stock Exchange Medallion Program (SEMP); or
(iv) in such other guarantee program acceptable to the Trustee.
OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Senior Note purchased by the Company
pursuant to Section 4.10 or 4.18 of the Indenture, check the box below:
[ ] Section 4.10 [ ] Section 4.18
If you want to elect to have only part of the Senior Note purchased by
the Company pursuant to Section 4.10 or Section 4.18 of the Indenture, state the
amount you elect to have purchased: $____________
Date: ____________
Your Signature: ______________________________________
(Sign exactly as your name appears on the
Declaration)
Tax Identification No.: ____________
Signature Guarantee:
NOTICE: The Signature must be guaranteed by an Institution which is a member of
one of the following recognized signature Guarantee Programs: (i) The Securities
Transfer Agent Medallion Program (STAMP); (ii) The New York Stock Exchange
Medallion Program (MNSP); (iii) The Stock Exchange Medallion Program (SEMP); or
(iv) in such other guarantee program acceptable to the Trustee.
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF
TRANSFER RESTRICTED SECURITIES(3)
Re: SERIES A SENIOR DISCOUNT NOTES
DUE 2009 OF UNITED INTERNATIONAL HOLDINGS, INC.
This Certificate relates to $______ principal amount at maturity
(except as provided in paragraph 1 of the Note) of Securities held in (check
applicable space) _____ book-entry or ______ definitive form by
_________________ (the "Transferor").
The Transferor (check applicable box):
[ ] has requested the Trustee by written order to deliver in exchange
for its beneficial interest in the Global Security held by the Depositary a
Security or Securities in definitive, registered form of authorized
denominations and an aggregate principal amount at maturity equal to its
beneficial interest in such Global Security (or the portion thereof indicated
above); or
[ ] has requested the Trustee by written order to exchange or register
the transfer of a Security or Securities.
In connection with such request and in respect of each such Security,
the Transferor does hereby certify that Transferor is familiar with the
Indenture relating to the above-captioned Securities and as provided in Section
2.6 of such Indenture, the transfer of this Security does not require
registration under the Securities Act (as defined below) because:
[ ] Such Security is being acquired for the Transferor's own account,
without transfer (in satisfaction of Section 2.6(a)(ii)(A) or Section
2.6(d)(i)(A) of the Indenture).
[ ] Such Security is being transferred to a "qualified institutional
buyer" (within the meaning of Rule 144A promulgated under the Securities Act),
that is aware that any sale of Securities to it will be made in reliance on Rule
144A under the Securities Act and that is acquiring such Transfer Restricted
Security for its own account, or for the account of another such "qualified
------------------
(3) This Certificate shall be included only for Initial Securities.
institutional buyer" (in satisfaction of Section 2.06(a)(ii)(B) or Section
2.06(d)(i)(B) of the Indenture).
[ ] Such Security is being transferred pursuant to an exemption from
registration in accordance with Rule 144, or outside the United States in an
Offshore Transaction in compliance with Rule 904 under the Securities Act, or
pursuant to an effective registration statement under the Securities Act (in
satisfaction of Section 2.6(a)(ii)(C) or Section 2.6(d)(i)(C) of the Indenture).
[ ] Such Security is being transferred in reliance on and in compliance
with an exemption from the registration requirements of the Securities Act and
in accordance with applicable securities laws of the states of the United
States, other than as provided in the immediately preceding paragraph. An
Opinion of Counsel to the effect that such transfer does not require
registration under the Securities Act accompanies this Certificate (in
satisfaction of Section 2.6(a)(ii)(D) or Section 2.6(d)(i)(D) of the Indenture).
[INSERT NAME OF TRANSFEROR]
By:
Date:
CERTIFICATE TO BE DELIVERED UPON EXCHANGE OR REGISTRATION OF TRANSFER OF
SECURITIES(4)
Re: SERIES B Senior Discount Notes
DUE 2009 OF UNITED INTERNATIONAL HOLDINGS, INC.
This Certificate relates to $______ principal amount at
maturity of Securities held in (check applicable box) _____ book-entry or ______
definitive form by _____ (the "Transferor").
The Transferor (check applicable box):
[ ] has requested the Trustee by written order to deliver in exchange
for its beneficial interest in the Global Security held by the Depositary a
Security or Securities in definitive, registered form of authorized
denominations and an aggregate principal amount at maturity equal to its
beneficial interest in such Global Security (or the portion thereof indicated
above); or
[ ] has requested the Registrar by written order to exchange or
register the transfer of a Security or Securities.
----------------
(4) This certificate shall be included only for the Exchange Securities.