EXHIBIT 4.1
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KNOLOGY, INC.,
Issuer
and
WILMINGTON TRUST COMPANY,
Trustee
----------------------------
Indenture
Dated as of November 6, 2002
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12% Senior Notes due 2009
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CROSS-REFERENCE TABLE
TIA Sections Indenture Sections
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(S) 310(a)(1) 7.10
(a)(2) 7.10
(b)7.08
(S) 313(c) 7.06; 10.02
(S) 314(a) 4.17; 10.02
(a)(4) 4.16; 10.02
(c)(1) 10.03
(c)(2) 10.03
(e) 10.04
(S) 315(b) 7.05; 10.02
(S) 316(a)(1) 2.10
(S) (a)(1)(A) 6.05
(a)(1)(B) 6.04
(a)(2) 2.10
(b) 6.07
(d)(2) 2.10
(S) 317(a)(1) 6.08
(a)(2) 6.09
(S) 318(a) 10.01
(c) 10.01
Note: The Cross-Reference Table shall not for any purpose be deemed to be a part
of the Indenture.
TABLE OF CONTENTS
Page
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ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01 Definitions....................................................2
SECTION 1.02 Incorporation by Reference of Trust Indenture Act.............16
SECTION 1.03 Rules of Construction.........................................16
ARTICLE TWO
THE NOTES
SECTION 2.01 Form and Dating...............................................17
SECTION 2.02 Restrictive Legends...........................................18
SECTION 2.03 Execution, Authentication and Denominations...................18
SECTION 2.04 Registrar and Paying Agent....................................19
SECTION 2.05 Paying Agent to Hold Money in Trust...........................20
SECTION 2.06 Transfer and Exchange.........................................20
SECTION 2.07 Book-Entry Provisions for Global Notes........................21
SECTION 2.08 Special Transfer Provisions...................................22
SECTION 2.09 Replacement Notes.............................................22
SECTION 2.10 Outstanding Notes.............................................23
SECTION 2.11 Temporary Notes...............................................23
SECTION 2.12 Cancellation..................................................24
SECTION 2.13 CUSIP Numbers.................................................24
SECTION 2.14 Defaulted Interest............................................24
ARTICLE THREE
REDEMPTION
SECTION 3.01 Right of Redemption...........................................25
SECTION 3.02 Notices to Trustee............................................25
SECTION 3.03 Selection of Notes to Be Redeemed.............................25
SECTION 3.04 Notice of Redemption..........................................25
SECTION 3.05 Effect of Notice of Redemption................................26
SECTION 3.06 Deposit of Redemption Price...................................26
SECTION 3.07 Payment of Notes Called for Redemption........................27
SECTION 3.08 Notes Redeemed in Part........................................27
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SECTION 3.09 Mandatory Redemption..........................................27
ARTICLE FOUR
COVENANTS
SECTION 4.01 Payment of Notes..............................................27
SECTION 4.02 Maintenance of Office or Agency...............................28
SECTION 4.03 Limitation on Indebtedness....................................29
SECTION 4.04 Limitation on Restricted Payments.............................31
SECTION 4.05 Limitation on Dividend and Other Payment Restrictions
Affecting Subsidiaries........................................33
SECTION 4.06 Limitation on the Issuance and Sale of Capital Stock of
Subsidiaries..................................................34
SECTION 4.07 Limitation on Issuances of Guarantees by Subsidiaries.........34
SECTION 4.08 Limitation on Transactions with Stockholders and Affiliates...35
SECTION 4.09 Limitation on Liens...........................................36
SECTION 4.10 Limitation on Asset Sales.....................................36
SECTION 4.11 Repurchase of Notes upon a Change of Control..................37
SECTION 4.12 Existence.....................................................37
SECTION 4.13 Payment of Taxes and Other Claims.............................38
SECTION 4.14 Maintenance of Properties and Insurance ......................38
SECTION 4.15 Notice of Defaults............................................38
SECTION 4.16 Compliance Certificates.......................................38
SECTION 4.17 Commission Reports and Reports to Holders.....................39
SECTION 4.18 Waiver of Stay, Extension or Usury Laws.......................39
SECTION 4.19 Limitation on Sale-Leaseback Transactions.....................39
SECTION 4.20 Limitation on Use of Revenues.................................40
SECTION 4.21 Excess Liquidity..............................................41
SECTION 4.22 Limitation on Capital Expenditures of Knology of Knoxville,
Inc...........................................................41
SECTION 4.23 Limitation on Management Activities...........................42
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01 When Company May Merge, Etc...................................42
SECTION 5.02 Successor Substituted.........................................43
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ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01 Events of Default.............................................43
SECTION 6.02 Acceleration..................................................44
SECTION 6.03 Other Remedies................................................45
SECTION 6.04 Waiver of Past Defaults.......................................45
SECTION 6.05 Control by Majority...........................................45
SECTION 6.06 Limitation on Suits...........................................46
SECTION 6.07 Rights of Holders to Receive Payment..........................46
SECTION 6.08 Collection Suit by Trustee....................................47
SECTION 6.09 Trustee May File Proofs of Claim..............................47
SECTION 6.10 Priorities....................................................47
SECTION 6.11 Undertaking for Costs.........................................48
SECTION 6.12 Restoration of Rights and Remedies............................48
SECTION 6.13 Rights and Remedies Cumulative................................48
SECTION 6.14 Delay or Omission Not Waiver..................................48
ARTICLE SEVEN
TRUSTEE
SECTION 7.01 General.......................................................48
SECTION 7.02 Rights of Trustee.............................................49
SECTION 7.03 Rights of Trustee.............................................50
SECTION 7.04 Trustee's Disclaimer..........................................50
SECTION 7.05 Notice of Default.............................................50
SECTION 7.06 Reports by Trustee to Holders.................................50
SECTION 7.07 Compensation and Indemnity....................................50
SECTION 7.08 Replacement of Trustee........................................51
SECTION 7.09 Successor Trustee by Merger, Etc..............................52
SECTION 7.10 Eligibility...................................................52
SECTION 7.11 Money Held in Trust...........................................52
SECTION 7.12 Withholding Taxes.............................................52
ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01 Termination of Company's Obligations..........................53
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SECTION 8.02 Defeasance and Discharge of Indenture.........................53
SECTION 8.03 Defeasance of Certain Obligations.............................56
SECTION 8.04 Application of Trust Money....................................57
SECTION 8.05 Repayment to Company..........................................58
SECTION 8.06 Reinstatement.................................................58
SECTION 8.07 Defeasance and Certain Other Events of Default................58
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01 Without Consent of Holders....................................58
SECTION 9.02 With Consent of Holders.......................................59
SECTION 9.03 Revocation and Effect of Consent..............................60
SECTION 9.04 Notation on or Exchange of Notes..............................60
SECTION 9.05 Trustee to Sign Amendments, Etc...............................61
SECTION 9.06 Conformity with Trust Indenture Act...........................61
ARTICLE TEN
MISCELLANEOUS
SECTION 10.01 Indenture Act of 1939.........................................61
SECTION 10.02 Notices.......................................................61
SECTION 10.03 Certificate and Opinion as to Conditions Precedent............62
SECTION 10.04 Statements Required in Certificate or Opinion.................63
SECTION 10.05 Rules by Trustee, Paying Agent or Registrar...................63
SECTION 10.06 Payment Date Other Than a Business Day........................63
SECTION 10.07 Governing Law.................................................63
SECTION 10.08 No Adverse Interpretation of Other Agreements.................63
SECTION 10.09 No Recourse Against Others....................................64
SECTION 10.10 Successors....................................................64
SECTION 10.11 Duplicate Originals...........................................64
SECTION 10.12 Separability..................................................64
SECTION 10.13 Table of Contents, Headings, Etc..............................64
ARTICLE ELEVEN
MEETINGS OF HOLDERS
SECTION 11.01 Purposes for Which Meetings May Be Called.....................64
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SECTION 11.02 Manner of Calling Meetings....................................65
SECTION 11.03 Call of Meetings by the Company or Holders....................65
SECTION 11.04 Who May Attend and Vote at Meetings...........................66
SECTION 11.05 Quorum; Action................................................66
SECTION 11.06 Regulations May Be Made by Trustee; Conduct of the Meeting;
Voting Rights; Adjournment....................................66
SECTION 11.07 Voting at the Meeting and Record to Be Kept...................67
SECTION 11.08 Exercise of Rights of Trustee or Holders May Not Be
Hindered or Delayed by Call of Meeting........................68
SECTION 11.09 Procedures Not Exclusive......................................68
EXHIBIT A Form of Note.................................................A-1
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INDENTURE, dated as of November 6, 2002, between KNOLOGY, INC., a Delaware
corporation (the "Company"), and WILMINGTON TRUST COMPANY, a Delaware trust
company (the "Trustee").
RECITALS
The Company has duly authorized the execution and delivery of this
Indenture to provide for the issuance of up to $193,491,000 aggregate principal
amount of the Company's 12% Senior Notes due 2009 issued hereunder plus the
aggregate principal amount of any PIK Notes (as defined below) issued pursuant
to the terms hereof (collectively, the "Notes") plus $1,173,836 in aggregate
principal amount of Notes issued to HLHZ Investments, LLC ("HLHZ") on behalf of
▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇ Capital in its capacity as financial advisor to
the Informal Noteholders' Committee (as defined below). The Notes, together with
an aggregate of approximately 10,684,742 shares of Series D non-cumulative,
convertible preferred stock of the Company ("Series D Preferred Stock") and an
aggregate of approximately 21,701,279 shares of Series E non-cumulative
non-voting, convertible preferred stock of the Company ("Series E Preferred
Stock" and, together with the Series D Preferred Stock, the "New Preferred
Stock") will be offered in exchange for $444.1 million aggregate principal
amount at maturity of Old Notes (as defined herein) previously issued by Knology
Broadband, Inc. ("Broadband"). The Company has agreed to issue the Notes and the
New Preferred Stock. All things necessary to make this Indenture a valid
agreement of the Company, in accordance with its terms, have been done, and the
Company has done all things necessary to make the Notes, when executed by the
Company and authenticated and delivered by the Trustee hereunder and duly issued
by the Company, the valid obligations of the Company as hereinafter provided.
This Indenture is subject to, and shall be governed by, the provisions of
the Trust Indenture Act of 1939 that are required to be a part of and to govern
indentures qualified under the Trust Indenture Act of 1939.
The Notes and the New Preferred Stock are being issued pursuant to (a) a
Joint Plan of Reorganization (the "Joint Plan") jointly proposed by the Company
and Broadband in Chapter 11 Case No. 02-11514 filed with the United States
Bankruptcy Court for the Northern District of Georgia (the "Bankruptcy Court")
and (b) Section 1145(a) of Title 11 of the United States Bankruptcy Code 11
U.S.C.(S)(S) 101 et seq. (as amended, the "Bankruptcy Code"). The Joint Plan has
been confirmed by the Bankruptcy Court and the Notes and the Preferred Stock are
exempt from registration under the Securities Act of 1933, as amended, and any
state and local securities laws and are freely transferable pursuant to Section
1145(a) of the Bankruptcy Code.
AND THIS INDENTURE FURTHER WITNESSETH
For and in consideration of the premises and the purchase of the Notes by
the Holders thereof, it is mutually covenanted and agreed, for the equal and
proportionate benefit of all Holders, the Company and the Trustee, as follows.
ARTICLE ONE
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01. Definitions.
"Acquired Assets" means (i) the Capital Stock of any Person that becomes a
Subsidiary after the Closing Date and (ii) the real or personal property of any
Person that becomes a Subsidiary after the Closing Date.
"Acquired Indebtedness" means Indebtedness of a Person existing at the time
such Person becomes a Subsidiary or assumed in connection with an Asset
Acquisition by a Subsidiary; provided that Indebtedness of such Person which is
redeemed, defeased, retired or otherwise repaid at the time of or immediately
upon consummation of the transactions by which such Person becomes a Subsidiary
or such Asset Acquisition shall not be Acquired Indebtedness.
"Affiliate" means, as applied to any Person, any other Person directly or
indirectly controlling, controlled by, or under direct or indirect common
control with, such Person. For-purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as applied to any Person, means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Agent" means any Registrar, Co-Registrar, Paying Agent or authenticating
agent.
"Agent Members" has the meaning provided in Section 2.07(a).
"Amended CoBank Facility" means that certain $40.0 million 10-year senior
secured credit facility by and among Globe Telecommunications, Inc., Interstate
Telephone Company and Valley Telephone Co., Inc., as borrowers, and CoBank, ACB,
as lender, as the same may be amended, restated, supplemented or modified from
time to time.
"Amended and Restated Wachovia Facility" means that certain $22.75 million
senior secured credit facility (under which the principal sum of $15,464,750 is
outstanding and under which no further sums may be borrowed) by and among
Broadband, as guarantor, the subsidiaries of Broadband, as borrowers, and
Wachovia Bank, National Association, as lender, as the same may be amended,
restated, supplemented or modified from time to time.
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"Asset Acquisition" means (i) an investment by the Company or any of its
Subsidiaries in any other Person pursuant to which such Person shall become a
Subsidiary or shall be merged into or consolidated with the Company or any of
its Subsidiaries; provided that such Person's primary business is related,
ancillary or complementary to the businesses of the Company and its Subsidiaries
on the date of such investment or (ii) an acquisition by the Company or any of
its Subsidiaries of the property and assets of any, Person other than the
Company or any of its Subsidiaries that constitute substantially all of a
division or line of business of such Person; provided that the property and
assets acquired are related, ancillary or complementary to the businesses of the
Company and its Subsidiaries on the date of such acquisition.
"Asset Sale" means any sale, transfer or other disposition (including by
way of merger, consolidation or sale-leaseback transaction) in one transaction
or a series of related transactions by the Company or any of its Subsidiaries to
any Person other than the Company or any of its Subsidiaries of (i) all or any
of the Capital Stock of any Subsidiary, (ii) all or substantially all of the
property and assets of an operating unit or business of the Company or any of
its Subsidiaries or (iii) any other property and assets of the Company or any of
its Subsidiaries outside the ordinary course of business of the Company or such
Subsidiary and, in each case, that is not governed by Article Five; provided
that "Asset Sale" shall not include (a) sales, transfers or other dispositions
of inventory, receivables and other current assets, (b) sales, transfers or
other dispositions of assets with a fair market value (as certified in an
Officers' Certificate) not in excess of $100,000 in any transaction or series of
related transactions, (c) sales, transfers or other dispositions of assets for
consideration at least equal to the fair market value of the assets sold,
transferred or otherwise disposed of to the extent the consideration received
would constitute property or assets of the kind described in clause (ii) of
Section 4.10, or (d) sales, transfers or other dispositions of customer premises
equipment.
"Average Life" means, at any date of determination with respect to any debt
security, the quotient obtained by dividing (i) the sum of the products of (a)
the number of years from such date of determination to the dates of each
successive scheduled principal payment of such debt security and (b) the amount
of such principal payment by (ii) the sum of all such principal payments.
"Board of Directors" means the Board of Directors of the Company or any
committee of such Board of Directors duly authorized to act under this
Indenture.
"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.
"Broadband" means Knology Broadband, Inc., a Delaware corporation formerly
known as Knology Holdings, Inc.
"▇▇▇▇▇▇ Partnerships" means, collectively, The ▇▇▇▇▇▇ Partnership, Limited
Partnership and The ▇▇▇▇▇▇ Partnership (QP), Limited Partnership.
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"Business Day" means any day except a Saturday, Sunday or other day on
which commercial banks in The City of New York, or in the city of the Corporate
Trust Office of the Trustee, are authorized by law to close.
"Capital Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) in equity of such Person, whether outstanding on the
Closing Date or issued thereafter, including, without limitation, all Common
Shares and Preferred Shares.
"Capitalized Lease" means, as applied to any Person, any lease of any
property (whether real, personal or mixed) of which the discounted present value
of the rental obligations of such Person as lessee, in conformity with GAAP, is
required to be capitalized on the balance sheet of such Person.
"Capitalized Lease Obligations" means the discounted present value of the
rental obligations under a Capitalized Lease.
"Change of Control" means such time as (i) a "person" or "group" (within
the meaning of Sections 13(d) and 14(d)(2) of the Exchange Act) (other than one
or more Existing Stockholders acting individually or in concert) becomes the
ultimate "beneficial owner" (as defined in Rule 13d-3 under the Exchange Act) of
more than 35% of the total voting power of the Voting Stock of the Company, on a
fully diluted basis; (ii) individuals who on the Closing Date constitute the
Board of Directors (together with any new directors whose election by the Board
of Directors or whose nomination by the Board of Directors for election by the
Company's stockholders was approved by a vote of at least two-thirds of the
members of the Board of Directors then in office who either were members of the
Board of Directors on the Closing Date or whose election or nomination for
election was previously so approved) cease for any reason to constitute a
majority of the members of the Board of Directors then in office; or (iii) the
Company consolidates with, or merges with or into, any Person, or any Person
consolidates with, or merges with or into, the Company, in any such event
pursuant to a transaction in which any of the outstanding Voting Stock of the
Company is converted into or exchanged for cash, securities or other property,
other than any such transaction where the Voting Stock of the Company
outstanding immediately prior to such transaction is converted into or exchanged
for Voting Stock (other than Redeemable Stock) of the surviving or transferee
Person constituting a majority of the outstanding shares of such Voting Stock of
such surviving or transferee Person immediately after giving effect to such
issuance.
"Closing Date" means November 6, 2002.
"Commission" means the Securities and Exchange Commission, as from time to
time constituted, created under the Exchange Act or, if at any time after the
execution of this instrument such Commission is not existing and performing the
duties now assigned to it under the TIA, then the body performing such duties at
such time.
"Common Stock" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of
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such Person's equity, other than Preferred Shares of such Person, whether
outstanding on the Closing Date or issued thereafter, including, without
limitation, all series and classes of such common stock.
"Company" means the party named as such in the first paragraph of this
Indenture until a successor replaces it pursuant to Article Five of this
Indenture and thereafter means the successor.
"Consolidated Net Worth" means, at any date of determination, stockholders'
equity as set forth on the most recently available quarterly or annual
consolidated balance sheet of the Company and its Subsidiaries which shall be as
of a date not more than 90 days prior to the date of such computation, less any
amounts attributable to Redeemable Stock or any equity security convertible into
or exchangeable for Indebtedness, the cost of treasury stock and the principal
amount of any promissory notes receivable from the sale of the Capital Stock of
the Company or any of its Subsidiaries, each item to be determined in conformity
with GAAP (excluding the effects of foreign currency exchange adjustments under
Financial Accounting Standards Board Statement of Financial Accounting Standards
No. 52).
"Corporate Trust Office" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date of this Indenture,
located at ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇, Attention:
Corporate Trust Reorg Services.
"Credit Facilities" means the Amended CoBank Facility and the Amended and
Restated Wachovia Facility, and any revolving and/or term credit facility that
amends, restates, modifies, renews, refunds, replaces, substitutes or refinances
the Amended CoBank Credit Facility or the Amended and Restated Wachovia Credit
Facility (or any replacement credit facility) in whole or in part from time to
time.
"Currency Agreement" means any foreign exchange contract, currency swap
agreement or other similar agreement or arrangement.
"Default" means any event that is, or after notice or passage of time or
both would be, an Event of Default.
"Depository" means The Depository Trust Company, its nominees, and their
respective successors.
"Event of Default" has the meaning provided in Section 6.01.
"Excess Proceeds" has the meaning provided in Section 4.10.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indebtedness" means all Indebtedness of the Company and its
Subsidiaries existing on the Closing Date immediately following the issuance of
the Notes.
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"Existing Stockholders" means ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ III, SCANA, The ▇▇▇▇▇▇
Partnership, Limited Partnership, The ▇▇▇▇▇▇ Partnership (QP), Limited
Partnership, ITC Telecom Ventures, Inc., ▇.▇. ▇▇▇▇▇▇▇ ▇▇, L.P., Blackstone CCC
Capital Partners L.P., Blackstone CCC Offshore Capital Partners L.P., and
Blackstone Family Limited Investment Partnership III, L.P. or any Subsidiary or
Affiliate thereof or any lineal descendant, or spouses of, or trusts controlled
by or under which the primary beneficiary thereunder is, any of the foregoing.
"fair market value" means the price that would be paid in an arm's-length
transaction between an informed and willing seller under no compulsion to sell
and an informed and willing buyer under no compulsion to buy, as determined in
good faith by the Board of Directors, whose determination shall be conclusive if
evidenced by a Board Resolution.
"GAAP" means generally accepted accounting principles in the United States
of America as in effect from time to time, including, without limitation, those
set forth in the opinions and pronouncements of the Accounting Principles Board
of the American Institute of Certified Public Accountants and statements and
pronouncements of the Financial Accounting Standards Board or in such other
statements by such other entity as approved by a significant segment of the
accounting profession. All ratios and computations contained or referred to in
this Indenture shall be computed in conformity with GAAP applied on a consistent
basis, except that computations made for purposes of determining compliance with
the terms of the covenants and with other provisions of this Indenture shall be
made without giving effect to (i) the amortization of any expenses incurred in
connection with the offering of the Notes and (ii) except as otherwise provided,
the amortization of any amounts required or permitted by Accounting Principles
Board Opinion Nos. 16 and 17.
"Global Notes" has the meaning provided in Section 2.01.
"Guarantee" means any obligation, contingent or otherwise, of any Person
directly or indirectly guaranteeing any Indebtedness of any other Person and,
without limiting the generality of the foregoing, any obligation, direct or
indirect, contingent or otherwise, of such Person (i) to purchase or pay (or
advance or supply funds for the purchase or payment of) such Indebtedness of
such other Person (whether arising by virtue of partnership arrangements, or, by
agreements to keep-well, to purchase assets, goods, securities or services
(unless such purchase arrangements are on arm's-length-terms and are entered
into in the ordinary course of business), to take-or-pay, or to maintain
financial statement conditions or otherwise) or (ii) entered into for purposes
of assuring in any other manner the obligee of such Indebtedness of the payment
thereof or to protect such obligee against loss in respect thereof (in whole or
in part); provided that the term "Guarantee" shall not include endorsements for
collection or deposit in the ordinary course of business. The term "Guarantee"
used as a verb has a corresponding meaning.
"Holder" means the registered holder of any Note.
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"Incur" means, with respect to any Indebtedness, to incur, create, issue,
assume, Guarantee or otherwise become liable for or with respect to, or become
responsible for, the payment of, contingently or otherwise, such Indebtedness,
including an Incurrence of Acquired Indebtedness; provided that the accrual of
interest shall not be considered an Incurrence of Indebtedness.
"Indebtedness" means, with respect to any Person at any date of
determination (without duplication), (i) all indebtedness of such Person for
borrowed money, (ii) all obligations of such Person evidenced by bonds,
debentures, notes or other similar instruments, (iii) all obligations of such
Person in respect of letters of credit or other similar instruments (including
reimbursement obligations with respect thereto), (iv) all obligations of such
Person to pay the deferred and unpaid purchase price of property or services,
which purchase price is due more than six months after the date of placing such
property in service or taking delivery and title thereto or the completion of
such services, except Trade Payables, (v) all Capitalized Lease Obligations of
such Person, (vi) all Indebtedness of other Persons secured by a Lien on any
asset of such Person, whether or not such Indebtedness is assumed by such
Person; provided that the amount of such Indebtedness shall be the lesser of (A)
the fair market value of such asset at such date of determination and (B) the
amount of such Indebtedness, (vii) all Indebtedness of other Persons Guaranteed
by such Person to the extent such Indebtedness is Guaranteed by such Person and
(viii) to the extent not otherwise included in this definition, obligations
under Currency Agreements and Interest Rate Agreements. The amount of
Indebtedness of any Person at any date shall be the outstanding balance at such
date (or, in the case of a revolving credit or other similar facility, the total
amount of funds outstanding and/or available on the date of determination) of
all unconditional obligations as described above and, with respect to contingent
obligations, the maximum liability upon the occurrence of the contingency giving
rise to the obligation, provided (A) that the amount outstanding at any time of
any Indebtedness issued with original issue discount is the face amount of such
Indebtedness less the remaining unamortized portion of the original issue
discount of such Indebtedness at the time of its issuance as determined in
conformity with GAAP, (B) that money borrowed and set aside at the time of the
incurrence of any Indebtedness in order to prefund the payment of the interest
on such Indebtedness shall not be deemed to be "Indebtedness" and (C) that
Indebtedness shall not include any liability for federal, state, local or other
taxes.
"Indenture" means this Indenture as originally executed or as it may be
amended or supplemented from time to time by one or more indentures supplemental
to this Indenture entered into pursuant to the applicable provisions of this
Indenture.
"Informal Noteholders' Committee" means an informal committee of holders of
Old Notes to which ▇▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ & ▇▇▇▇▇ Capital provided investment
banking services in connection with the Restructuring.
"Institutional Accredited Investor" means an institution that is an
"accredited investor" as that term is defined in Rule 501(a)(1), (2), (3) or (7)
under the Securities Act.
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"Interest Payment Date" means each semiannual interest payment date on May
31 and November 30 of each year, commencing May 31, 2003.
"Interest Rate Agreement" means any interest rate protection agreement,
interest rate future agreement, interest rate option agreement, interest rate
swap agreement, interest rate cap agreement, interest rate collar agreement,
interest rate hedge agreement, option or futures contract or other similar
agreement or arrangement.
"Investment" in any Person means any direct or indirect advance, loan or
other extension of credit (including, without limitation, by way of Guarantee or
similar arrangement; but excluding advances to customers in the ordinary course
of business that are, in conformity with GAAP, recorded as accounts receivable
on the balance sheet of the Company or its Subsidiaries) or capital contribution
to (by means of any transfer of cash or other property to others or any payment
for property or services for the account or use of others), or any purchase or
acquisition of Capital Stock, bonds, notes, debentures or other similar
instruments issued by, such Person and shall include the fair market value of
the Capital Stock (or any other Investment), held by the Company or any of its
Subsidiaries, of (or in) any Person that has ceased to be a Subsidiary,
including, without limitation, by reason of any transaction permitted by clause
(iii) of Section 4.06.
"Joint Plan" has the meaning set forth in the "Recitals" hereto.
"Lien" means any mortgage, pledge, security interest, encumbrance, lien or
charge of any kind (including, without limitation, any conditional sale or other
title retention agreement or lease in the nature thereof or any agreement to
give any security interest).
"Net Cash Proceeds" means, (a) with respect to any Asset Sale, the proceeds
of such Asset Sale in the form of cash or cash equivalents, including payments
in respect of deferred payment obligations (to the extent corresponding to the
principal, but not interest, component thereof) when received in the form of
cash or cash equivalents (except to the extent such obligations are financed or
sold with recourse to the Company or any Subsidiary) and proceeds from the
conversion of other property received when converted to cash or cash
equivalents, net of (i) brokerage commissions and other fees and expenses
(including fees and expenses of counsel and investment bankers) related to such
Asset Sale, (ii) provisions for all taxes (whether or not such taxes will
actually be paid or are payable) as a result of such Asset Sale without regard
to the consolidated results of operations of the Company and its Subsidiaries,
taken as a whole, (iii) payments made to repay Indebtedness or any other
obligation outstanding at the time of such Asset Sale (other than Indebtedness
incurred under the Credit Facilities) that either (A) is secured by a Lien on
the property or assets sold or (B) is required to be paid as a result of such
sale, and (iv) appropriate amounts to be provided by the Company or any
Subsidiary as a reserve against any liabilities associated with such Asset Sale,
including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under
any indemnification obligations associated with such Asset Sale, all as
determined in conformity with GAAP, and (b) with respect to any capital
contribution or issuance or sale of Capital Stock, options,
- 8 -
warrants or other rights to acquire Capital Stock or Indebtedness, the proceeds
of such capital contribution or issuance or sale in the form of cash or cash
equivalents, including payments in respect of deferred payment obligations (to
the extent corresponding to the principal, but not interest, component thereof)
when received in the form of cash or cash equivalents (except to the extent such
obligations are financed or sold with recourse to the Company or any Subsidiary)
and proceeds from the conversion of other property received when converted to
cash or cash equivalents, net of attorney's fees, accountants' fees,
underwriters' or placement agents' fees, discounts or commissions and brokerage,
consultant and other fees incurred in connection with such issuance or sale and
net of taxes paid or payable as a result thereof.
"Non-Affiliated Holders" means each holder of Old Notes, other than SCANA
Communications Holdings, Inc., the ▇▇▇▇▇▇ Partnerships and Valley Telephone Co.,
Inc.
"Notes" means any of the securities, as defined in the first paragraph of
the recitals hereof, that are authenticated and delivered under this Indenture.
For all purposes of this Indenture, the term "Notes" shall include the Notes
initially issued on the Closing Date, and any PIK Notes issued after the Closing
Date under this Indenture. For purposes of this Indenture, all Notes shall vote
together as one series of Notes under this Indenture.
"Offer to Purchase" means an offer by the Company to purchase Notes from
the Holders commenced by mailing a notice to the Trustee and each Holder
stating: (i) the covenant pursuant to which the offer is being made and that all
Notes validly tendered shall be accepted for payment on a pro rata basis; (ii)
the purchase price and the date of purchase (which shall be a Business Day no
earlier than 30 days nor later than 60 days from the date such notice is mailed)
(the "Payment Date"); (iii) that any Note not tendered shall continue to accrue
interest pursuant to its terms; (iv) that, unless the Company defaults in the
payment of the purchase price, any Note accepted for payment pursuant to the
Offer to Purchase shall cease to accrue interest on and after the Payment Date;
(v) that Holders electing to have a Note purchased pursuant to the Offer to
Purchase shall be required to surrender the Note, together with the form
entitled "Option of the Holder to Elect Purchase" on the reverse side of the
Note completed, to the Paying Agent at the address specified in the notice prior
to the close of business on the Business Day immediately preceding the Payment
Date; (vi) that Holders shall be entitled to withdraw their election if the
Paying Agent receives, not later than the close of business on the third
Business Day immediately preceding the Payment Date, a facsimile transmission or
letter setting forth the name of such Holder, the principal amount of Notes
delivered for purchase and a statement that such Holder is withdrawing their
election to have such Notes purchased; and (vii) that Holders whose Notes are
being purchased only in part shall be issued new Notes equal in principal amount
to the unpurchased portion of the Notes surrendered; provided that each Note
purchased and each new Note issued shall be in a principal amount of $1,000 or
integral multiples thereof. On the Payment Date, the Company shall (i) accept
for payment on a pro rata basis Notes or portions thereof tendered pursuant to
an Offer to Purchase; (ii) deposit with the Paying Agent money sufficient to pay
the purchase price of all Notes or portions thereof so accepted; and (iii)
deliver, or cause to be delivered, to the Trustee all Notes or
- 9 -
portions thereof so accepted together with an Officers' Certificate specifying
the Notes or portions thereof accepted for payment by the Company. The Paying
Agent shall promptly mail to the Holders of Notes so accepted payment in an
amount equal to the purchase price, and the Trustee shall promptly authenticate
and mail to such Holders a new Note equal in principal amount to any unpurchased
portion of the Note surrendered; provided that each Note purchased and each new
Note issued shall be in a principal amount of $1,000 or integral multiples
thereof. The Company shall publicly announce the results of an Offer to Purchase
as soon as practicable after the Payment Date. The Trustee shall act as the
Paying Agent for an Offer to Purchase. The Company shall comply with Rule 14e-1
under the Exchange Act and any other securities laws and regulations thereunder
to the extent such laws and regulations are applicable, in the event that the
Company is required to repurchase Notes pursuant to an Offer to Purchase.
"Officer" means, with respect to the Company, (i) the Chairman of the
Board, the Chief Executive Officer, the President, any Vice President or the
Chief Financial Officer, and (ii) the Treasurer or any Assistant Treasurer, or
the Secretary or any Assistant Secretary.
"Officers' Certificate" means a certificate signed by one Officer listed in
clause (i) of the definition thereof and one Officer listed in clause (ii) of
the definition thereof or two officers listed in clause (i) of the definition
thereof. Each Officers' Certificate (other than certificates provided pursuant
to TIA Section 314(a)(4)) shall include the statements provided for in TIA
Section 314(e).
"Old Notes" means the 11-7/8% Senior Discount Notes of Broadband issued
pursuant to the Old Indenture.
"Old Notes Indenture" means that certain Indenture dated October 22, 1997
between Broadband and U.S. Trust Company of New York.
"Opinion of Counsel" means a written opinion signed by legal counsel, who
may be an employee of or counsel to the Company, that meets the requirements of
Section 10.04 hereof. Each such Opinion of Counsel shall include the statements
provided for in TIA Section 314(e).
"Paying Agent" has the meaning provided in Section 2.04, except that, for
the purposes of Article Eight, the Paying Agent shall not be the Company or a
Subsidiary of the Company or an Affiliate of any of them. The term "Paying
Agent" includes any additional Paying Agent.
"Payment Date" has the meaning set forth in the definition of "Offer to
Purchase" hereof.
"Permitted Investment" means (i) Investments in Wholly Owned Subsidiaries
that are Wholly Owned Subsidiaries of the Company as of the Closing Date; (ii)
Investments in Subsidiaries that are created, formed or acquired after the
Closing Date in an amount equal to the aggregate Net Cash Proceeds of the sale
and issuance of Capital Stock of the Company (other than Redeemable Stock);
(iii) Investments in Wholly Owned
- 10 -
Subsidiaries that provide services in markets and locations in which the Company
and its Subsidiaries are not doing business as of the Closing Date in an amount
not to exceed $1.5 million in any fiscal year of the Company; provided, however,
that the Company may utilize in any subsequent fiscal year any amounts not
applied or used in any prior fiscal years; (iv) a Temporary Cash Investment; (v)
commission, payroll, travel and similar advances to cover matters that are
expected at the time of such advances ultimately to be treated as expenses in
accordance with GAAP; (vi) stock, obligations or securities received in
satisfaction of judgments; (vii) Investments in prepaid expenses, negotiable
instruments held for collection, and lease, utility and workers' compensation,
performance and other similar deposits; (viii) loans or advances to employees of
the Company or a Subsidiary made in the ordinary course of business that do not
in the aggregate exceed $500,000 at any time outstanding; and (ix) Interest Rate
Agreements and Currency Agreements to the extent permitted under clause (v) of
Section 4.03; and (x) Investments with the Net Cash Proceeds of Asset Sales not
used to make payments with respect to Indebtedness of the Company or any
Subsidiary in accordance with the terms of this Indenture or used to make an
Offer to Purchase.
"Permitted Liens" means (i) Liens for taxes, assessments, governmental
charges or claims that are being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provisions, if any, as shall be required in conformity with
GAAP shall have been made; (ii) statutory, and common law Liens of landlords and
carriers, warehousemen, mechanics, suppliers, materialmen, repairmen or other
similar Liens arising in the ordinary course of business and with respect to
amounts not yet delinquent or being contested in good faith by appropriate legal
proceedings promptly instituted and diligently conducted and for which a reserve
or other appropriate provisions, if any, as shall be required in conformity with
GAAP shall have been made; (iii) Liens incurred or deposits made in the ordinary
course of business in connection with workers' compensation, unemployment
insurance and other types of social security; (iv) Liens incurred or deposits
made to secure the performance of tenders, bids, leases, statutory or regulatory
obligations, bankers' acceptances, surety and appeal bonds, government
contracts, performance and return-of-money bonds and other obligations of a
similar nature incurred in the ordinary course of business (exclusive of
obligations for the payment of borrowed money); (v) easements, rights-of-way,
municipal and zoning ordinances and similar charges, encumbrances, title defects
or other irregularities that do not materially interfere with the ordinary
course of business of the Company or any of its Subsidiaries; (vi) Liens
(including extensions and renewals thereof) upon real or personal property
(including, without limitation, Acquired Assets) acquired after the Closing
Date; provided that (a) such Lien is created solely for the purpose of securing
Indebtedness Incurred, in accordance with Section 4.03(viii), to finance the
cost (including, without limitation, the cost of design, development,
construction, acquisition, installation, improvement, transportation or
integration) of the real or personal property subject thereto and such Lien is
created prior to, at the time of or within six months after the latest of the
acquisition, the completion of construction or the commencement of full
operation of such real or personal property; provided that in the case of
Acquired Assets, the Lien secures the Indebtedness Incurred to purchase the
Capital Stock of the Person to make such Person a Subsidiary, (b) the principal
amount of the Indebtedness secured by
- 11 -
such Lien does not exceed 100% of such cost and (c) any such Lien shall not
extend to or cover any real or personal property other than such real or
personal property and any improvements on such real or personal property and any
proceeds thereof; (vii) leases or subleases granted to others that do not
materially interfere with the ordinary course of business of the Company and its
Subsidiaries, taken as a whole; (viii) Liens encumbering property or assets
under construction arising from progress or partial payments by a customer of
the Company or its Subsidiaries relating to such property or assets; (ix) any
interest or title of a lessor in the property subject to any Capitalized Lease
or operating lease; (x) Liens arising from filing Uniform Commercial Code
financing statements regarding leases; (xi) Liens on property of, or on shares
of Capital Stock or Indebtedness of, any Person existing at the time such Person
becomes, or becomes a part of, any Subsidiary; provided that such Liens do not
extend to or cover any property or assets of the Company or any Subsidiary other
than the property or assets acquired and any proceeds thereof; (xii) Liens in
favor of the Company or any Subsidiary; (xiii) Liens arising from the. rendering
of a final judgment or order against the Company or any Subsidiary that does not
give rise to an Event of Default; (xiv) Liens securing reimbursement obligations
with respect to letters of credit that encumber documents and other property
relating to such letters of credit and the products and proceeds thereof; (xv)
Liens in favor of customs and revenue authorities arising as a matter of law to
secure payment of customs duties in connection with the importation of goods;
(xvi) Liens encumbering customary initial deposits and margin deposits, and
other Liens that are either within the general parameters customary in the
industry and incurred in the ordinary course of business, in each case securing
Indebtedness under Interest Rate Agreements and Currency Agreements and forward
contracts, options, futures contracts, futures options or similar agreements or
arrangements designed solely to protect the Company or any of its Subsidiaries
from fluctuations in interest rates, currencies or the price of commodities;
(xvii) Liens arising out of conditional sale, title retention, consignment or
similar arrangements for the sale of goods entered into by the Company or any of
its Subsidiaries in the ordinary course of business in accordance with the past
practices of the Company and its Subsidiaries prior to the Closing Date; (xviii)
Liens on or sales of receivables, including related intangible assets and
proceeds thereof; and (xix) Liens made in the ordinary course of business on
assets subject to rights-of-way, pole attachment, use of conduit, use of
trenches or similar agreements securing the Company's or any Subsidiary's
obligations under such agreements.
"Person" means an individual, a corporation, a partnership, a limited
liability company, an association, a trust or any other entity or organization,
including a government or political subdivision or an agency or instrumentality
thereof.
"Physical Notes" has the meaning provided in Section 2.01.
"PIK Note" means a Note issued by the Company during the PIK Period to a
Holder as payment of interest in lieu of cash on the applicable Interest Payment
Date during the PIK Period.
"PIK Period" means the period from and including the Closing Date to and
including May 31, 2004 (or the next Business Day occurring thereafter).
- 12 -
"Preferred Shares" means, with respect to any Person, any and all shares,
interests, participations or other equivalents (however designated, whether
voting or non-voting) of such Person's preferred or preference equity, whether
outstanding on the Closing Date; or issued thereafter, including, without
limitation, all series and classes of such preferred or preference stock.
"principal" of a debt security, including the Notes, means the principal
amount due on the Stated Maturity as shown on such debt security.
"Redeemable Stock" means any class or series of Capital Stock of any Person
that by its terms or otherwise is (i) required to be redeemed prior to the
Stated Maturity of the Notes, (ii) redeemable at the option of the holder of
such class or series of Capital Stock at any time prior to the Stated Maturity
of the Notes or (iii) convertible into or exchangeable for Capital Stock
referred to in clause (i) or (ii) above or Indebtedness having a scheduled
maturity prior to the Stated Maturity of the Notes; provided that any Capital
Stock that would not constitute Redeemable Stock but for provisions thereof
giving holders thereof the right to require such Person to repurchase or redeem
such Capital Stock upon the occurrence of an "asset sale" or "change of control"
occurring prior to the Stated Maturity of the Notes shall not constitute
Redeemable Stock if the "asset sale" or "change of control" provisions
applicable to such Capital Stock are no more favorable in any material respect
to the holders of such Capital Stock than the provisions contained in Section
4.10 and Section 4.11 are to the holders of the Notes and such Capital Stock
specifically provides that such Person shall not repurchase or redeem any such
stock pursuant to such provisions prior to the Company's repurchase of such
Notes as are required to be repurchased pursuant to Section 4.10 and Section
4.11.
"Redemption Date" means, when used with respect to any Note to be redeemed,
the date fixed for such redemption by or pursuant to this Indenture.
"Redemption Price" means, when used with respect to any Note to be
redeemed, the price, expressed as a percentage of the face principal amount of
such Note, at which such Note is to be redeemed pursuant to this Indenture.
"Registrar" has the meaning provided in Section 2.04.
"Regular Record Date" for the interest payable on any Interest Payment Date
means May 15 or November 15 (whether or not a Business Day), as the case may be,
next preceding such Interest Payment Date.
"Responsible Officer", when used with respect to the Trustee, means the
chairman or any vice chairman of the board of directors, the chairman or any
vice chairman of the executive committee of the board of directors, the chairman
of the trust committee, the president, any vice president, any assistant vice
president, the secretary, any assistant secretary, the treasurer, any assistant
treasurer, the cashier, any assistant cashier, any trust officer or assistant
trust officer, the controller or any assistant controller or any other officer
of the Trustee in its Corporate Trust Department customarily performing
functions similar to those performed by any of the above-designated officers and
in each case
- 13 -
having direct responsibility for the administration of this Indenture and also
means, with respect to a particular corporate trust matter, any other officer to
whom such matter is referred because of his or her knowledge of and familiarity
with the particular subject.
"Restricted Payments" has the meaning provided in Section 4.04.
"Restructuring" means the financial restructuring of the Company and
Broadband through a recapitalization plan.
"SCANA" means SCANA Communications Holdings, Inc.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Register" has the meaning provided in Section 2.04.
"Significant Subsidiary" means, at any date of determination, any
Subsidiary that, together with its Subsidiaries, (i) for the most recent fiscal
year of the Company, accounted for more than 10% of the consolidated revenues of
the Company and its Subsidiaries or (ii) as of the end of such fiscal year, was
the owner of more than 10% of the consolidated assets of the Company and its
Subsidiaries, all as set forth on the most recently available consolidated
financial statements of the Company for such fiscal year.
"Specified Date" means any Redemption Date, any Payment Date for an Offer
to Purchase or any date on which the Notes first become due and payable after an
Event of Default.
"Stated Maturity" means (i) with respect to any debt security, the date
specified in such debt security as the fixed date on which the final installment
of principal of such debt security is due and payable and (ii) with respect to
any scheduled installment of principal of or interest on any debt security, the
date specified in such debt security as the fixed date on which such installment
is due and payable.
"Subsidiary" means, with respect to any Person, any corporation,
association or other business entity of which more than 50% of the voting power
of the outstanding Voting Stock is owned, directly or indirectly, by such Person
and one or more other Subsidiaries of such Person.
"Temporary Cash Investment" means any of the following: (i) direct
obligations of the United States of America or any agency thereof or obligations
fully and unconditionally guaranteed by the United States of America or any
agency thereof, (ii) time deposit accounts, certificates of deposit and money
market deposits maturing within one year of the date of acquisition thereof
issued by a bank or trust company which is organized under the laws of the
United States of America, any state thereof or any foreign country recognized by
the United States of America, and which bank or trust company has capital,
surplus and undivided profits aggregating in excess of $50 million (or the
foreign currency equivalent thereof) and has outstanding debt which is rated "A"
(or such similar equivalent rating) or higher by at least one nationally
recognized statistical rating organization (as defined in Rule 436 under the
Securities Act) or any money-market fund
- 14 -
sponsored by a registered broker dealer or mutual fund distributor, (iii)
repurchase obligations with a term of not more than 30 days for underlying
securities of the types described in clause (i) above entered into with a bank
meeting the qualifications described in clause (ii) above, (iv) commercial
paper, maturing not more than one year after the date of acquisition, issued by
a corporation (other than an Affiliate of the Company) organized and in
existence under the laws of the United States of America, any state thereof or
any foreign country recognized by the United States of America with a rating at
the time as of which any investment therein is made of "P-1" (or higher)
according to ▇▇▇▇▇'▇ Investors Service, Inc. or "A-1" (or higher) according to
Standard & Poor's Ratings Services, and (v) securities with maturities of six
months or less from the date of acquisition issued or fully and unconditionally
guaranteed by any state, commonwealth or territory of the United States of
America, or by any political subdivision or taxing authority thereof, and rated
at least "A" by Standard & Poor's Ratings Services or ▇▇▇▇▇'▇ Investors Service,
Inc.
"TIA" or "Trust Indenture Act" means the Trust Indenture Act of 1939, as
amended (15 U.S. Code (S)(S) 77aaa-77bbbb), as in effect on the date this
Indenture was executed, except as provided in Section 9.06.
"Trade Payables" means, with respect to any Person, any accounts payable or
any other indebtedness or monetary obligation to trade creditors created,
assumed or Guaranteed by such Person or any of its Subsidiaries arising in the
ordinary course of business in connection with the acquisition of goods or
services.
"Transaction Date" means, with respect to the Incurrence of any
Indebtedness by the Company or any of its Subsidiaries, the date such
Indebtedness is to be Incurred and, with respect to any Restricted Payment, the
date such Restricted Payment is to be made.
"Trustee" means the party named as such in the first paragraph of this
Indenture until a successor replaces it in accordance with the provisions of
Article Seven of this Indenture and thereafter means such successor.
"United States Bankruptcy Code" means the Bankruptcy Reform Act of 1978, as
amended and as codified in Title 11 of the United States Code, as amended from
time to time hereafter, or any successor federal bankruptcy law.
"U.S. Government Obligations" means securities that are (i) direct
obligations of the United States of America for the payment of which its full
faith and credit is pledged or (ii) obligations of a Person controlled or
supervised by and acting as an agency or instrumentality of the United States of
America the 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 at any time prior
to the Stated Maturity of the Notes, and shall also include a depository receipt
issued by a bank or trust company as custodian with respect to any such U.S.
Government Obligation or a specific payment of interest on or principal of any
such U.S. Government Obligation held by such custodian for the account of the
holder of a depository receipt; provided that (except as required by law) such
custodian is not
- 15 -
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
U.S. Government Obligation or the specific payment of interest on or principal
of the U.S. Government Obligation evidenced by such depository receipt.
"Voting Stock" means, with respect to any Person, Capital Stock of any
class or kind ordinarily having the power to vote for the election of directors,
managers or other voting members of the governing body of such Person.
"Wholly Owned" means, with respect to any Subsidiary of any Person, the
ownership of all of the outstanding Capital Stock of such Subsidiary (other than
any director's qualifying shares or Investments by foreign nationals mandated by
applicable law) by such Person or one or more Wholly Owned Subsidiaries of such
Person.
SECTION 1.02. 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 Notes;
"indenture security holder" means a Holder or a Noteholder;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the indenture securities means the Company or any other
obligor on the Notes.
All other TIA terms used in this Indenture that are defined by the TIA,
defined by TIA reference to another statute or defined by a rule of the
Commission and not otherwise defined herein have the meanings assigned to them
therein.
SECTION 1.03. Rules of Construction. Unless the context otherwise requires:
(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning assigned to
it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and words in the plural
include the singular;
(v) provisions apply to successive events and transactions;
- 16 -
(vi) "herein," "hereof" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision;
(vii) all ratios and computations based on GAAP contained in this Indenture
shall be computed in accordance with the definition of GAAP set forth in Section
1.01; and
(viii) all references to Sections or Articles refer to Sections or Articles
of this Indenture unless otherwise indicated.
ARTICLE TWO
THE NOTES
SECTION 2.01. Form and Dating. The Notes and the Trustee's certificate of
authentication shall be substantially in the form annexed hereto as Exhibit A
with such appropriate insertions, omissions, substitutions and other variations
as are required or permitted by this Indenture. The Notes may have notations,
legends or endorsements required by law, stock exchange agreements to which the
Company is subject or usage. The Company shall approve the form of the Notes and
any notation, legend or endorsement on the Notes. Each Note shall be dated the
date of its authentication. The aggregate principal amount of the Notes shall be
no greater than $194,664,836 plus the aggregate principal amount of all PIK
Notes issued hereunder.
The terms and provisions contained in the form of the Notes annexed hereto
as Exhibit A shall constitute, and are hereby expressly made, a part of this
Indenture. To the extent applicable, 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.
Notes shall be issued initially in the form of one or more permanent global
Notes in registered form, substantially in the form set forth in Exhibit A (the
Global Notes"), registered in the name of the nominee of the Depository,
deposited with the Trustee, as custodian for the Depository, duly executed by
the Company and authenticated by the Trustee as hereinafter provided. The
aggregate principal amount of the Global Notes may from time to time be
increased or decreased by adjustments made on the records of the Trustee, as
custodian for the Depository or its nominee, in accordance with the instructions
given by the Holder thereof, as hereinafter provided.
Except as provided below, each PIK Note issued hereunder shall be in the
form of a Global Note, registered in the name of the nominee of the Depository,
deposited with the Trustee, as custodian for the Depository, duly executed by
the Company and authenticated by the Trustee as hereinafter provided.
Notes issued pursuant to Section 2.07 in exchange for interests in the Global
Notes shall be issued in the form of permanent certificated Notes in registered
form in substantially the form set forth in Exhibit A (the "Physical Notes").
HLHZ shall have its interest represented by a Physical Note in the principal
amount of $1,173,836. HLHZ shall receive its PIK Notes in the form of additional
Physical Notes.
- 17 -
The definitive Notes shall be typed, printed, lithographed or engraved or
produced by any combination of these methods or may be produced in any other
manner permitted by the rules of any securities exchange on which the Notes may
be listed, all as determined by the Officers executing such Notes, as evidenced
by their execution of such Notes.
SECTION 2.02. Registration. The Notes are being issued pursuant to the
Joint Plan and Section 1145(a) of the Bankruptcy Code. The Joint Plan has been
confirmed by the Bankruptcy Court and, accordingly, the Notes are exempt from
registration under the Securities Act of 1933, as amended, and any state and
local securities laws and are freely transferable pursuant to Section 1145(a) of
the Bankruptcy Code.
Each Global Note shall bear the following legend on the face thereof:
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN
THE NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT
HEREON IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN
AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER,
PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS
WRONGFUL SINCE THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST
HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT
NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH
SUCCESSOR'S NOMINEE.
SECTION 2.03. Execution Authentication and Denominations. The Notes shall
be executed by two Officers of the Company. The signature of these Officers on
the Notes may be by facsimile or manual signature in the name and on behalf of
the Company.
If an Officer whose signature is on a Note no longer holds that office at
the time the Trustee or authenticating agent authenticates the Note, the Note
shall be valid nevertheless.
A Note shall not be valid until the Trustee or authenticating agent
manually signs the certificate of authentication on the Note. The signature
shall be conclusive evidence that the Note has been authenticated under this
Indenture.
The Trustee may appoint an authenticating agent to authenticate Notes. An
authenticating agent may authenticate Notes whenever the Trustee may do so. Each
reference in this Indenture to authentication by the Trustee includes
authentication by
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such authenticating agent. An authenticating agent has the same rights as an
Agent to deal with the Company or an Affiliate of the Company. The Trustee shall
not be liable for the misconduct or negligence of any authenticating agent
appointed with due care.
The Notes shall be issuable only in registered form without coupons and,
except for the initial Notes issued to HLHZ and any PIK Notes issued in
accordance with the terms of this Indenture, only in denominations of $1,000 in
principal amount and any integral multiple of $1,000 in excess thereof;
provided, however, any PIK Notes shall be issued in amounts rounded up to the
nearest whole dollar.
SECTION 2.04. Registrar and Paying Agent. The Company shall maintain an
office or agency where Notes may be presented for registration of transfer or
for exchange (the "Registrar"), an office or agency where Notes may be presented
for payment (the "Paying Agent") and an office or agency where notices and
demands to or upon the Company in respect of the Notes and this Indenture may be
served, which shall be in the Borough of Manhattan, The City of New York and, if
the Notes are listed on the Luxembourg Stock Exchange, in Luxembourg. The
Company shall cause the Registrar to keep a register of the Notes and of their
transfer and exchange (the "Security Register"). The Company may have one or
more co-Registrars and one or more additional Paying Agents.
The Company shall enter into an appropriate agency agreement with any Agent
not a party to this Indenture. The agreement shall implement the provisions of
this Indenture that relate to such Agent. The Company shall give prompt written
notice to the Trustee of the name and address of any such Agent and any change
in the address of such Agent. If the Company fails to maintain a Registrar,
Paying Agent and/or agent for service of notices and demands, the Trustee shall
act as such Registrar, Paying Agent and/or agent for service of notices and
demands. The Company may remove any Agent upon written notice to such Agent and
the Trustee; provided that no such removal shall become effective until (i) the
acceptance of an appointment by a successor Agent to such Agent as evidenced by
an appropriate agency agreement entered into by the Company and such successor
Agent and delivered to the Trustee or (ii) notification to the Trustee that the
Trustee shall serve as such Agent until the appointment of a successor Agent in
accordance with clause (i) of this proviso. Except for the purposes of Article
Eight, the Company, any Subsidiary of the Company, or any Affiliate of any of
them may act as Paying Agent, Registrar or co-Registrar, and/or agent for
service of notice and demands.
The Company initially appoints the Trustee as Registrar, Paying Agent,
authenticating agent and agent for service of notice and demands. The Trustee
shall preserve in as current a form as is reasonably practicable the most recent
list available to it of the names and addresses of Holders and shall otherwise
comply with TIA (S) 312(a). If the Trustee is not the Registrar, the Company
shall furnish to the Trustee as of each Regular Record Date and at such other
times as the Trustee may request in writing a list in such form and as of such
date as the Trustee may reasonably require of the names and addresses of
Holders, including the aggregate principal amount of Notes held by each Holder.
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SECTION 2.05. Paying Agent to Hold Money in Trust. Not later than 11:00
a.m. (New York City time) on each due date of the principal, premium, if any,
and interest on any Notes, the Company shall deposit with the Paying Agent money
in immediately available funds sufficient to pay such principal, premium, if
any, and interest so becoming due. The Company shall require each Paying Agent
other than the Trustee to agree in writing that such Paying Agent shall hold in
trust for the benefit of the Holders or the Trustee all money held by the Paying
Agent for the payment of principal of, premium, if any, and interest on the
Notes (whether such money has been paid to it by the Company or any other
obligor on the Notes), and such Paying Agent shall promptly notify the Trustee
of any default by the Company (or any other obligor on the Notes) in making any
such payment. The Company at any time may require a Paying Agent to pay all
money held by it to the Trustee and account for any funds disbursed, and the
Trustee may at any time during the continuance of any payment default, upon
written request to a Paying Agent, require such Paying Agent to pay all money
held by it to the Trustee and to account for any funds disbursed. Upon doing so,
the Paying Agent shall have no further liability for the money so paid over to
the Trustee. If the Company or any Subsidiary of the Company or any Affiliate of
any of them acts as Paying Agent, it shall, on or before each due date of any
principal of, premium, if any, or interest on the Notes, segregate and hold in a
separate trust fund for the benefit of the Holders a sum of money sufficient to
pay such principal, premium, if any, or interest so becoming due until such sum
of money shall be paid to such Holders or otherwise disposed of as provided in
this Indenture, and shall promptly notify the Trustee of its action or failure
to act.
SECTION 2.06. Transfer and Exchange. The Notes are issuable only in
registered form. A Holder may transfer a Note only by written application to the
Registrar stating the name of the proposed transferee and otherwise complying
with the terms of this Indenture. No such transfer shall be effected until, and
such transferee shall succeed to the rights of a Holder only upon, final
acceptance and registration of the transfer by the Registrar in the Security
Register. Prior to the registration of any transfer by a Holder as provided
herein, the Company, the Trustee, and any agent of the Company shall treat the
person in whose name the Note is registered as the owner thereof for all
purposes whether or not the Note shall be overdue, and neither the Company, the
Trustee, nor any such agent shall be affected by notice to the contrary.
Furthermore, any Holder of a Global Note shall, by acceptance of such Global
Note, agree that transfers of beneficial interests in such Global Note may be
effected only through a book entry system maintained by the Holder of such
Global Note (or its agent) and that ownership of a beneficial interest in the
Note shall be required to be reflected in a book entry. When Notes are presented
to the Registrar or a co-Registrar with a request to register the transfer or to
exchange them for an equal principal amount of Notes of other authorized
denominations, the Registrar shall register the transfer or make the exchange as
requested if its requirements for such transactions are met (including that such
Notes are duly endorsed or accompanied by a written instrument of transfer in
form satisfactory to the Trustee and Registrar duly executed by the Holder
thereof or by an attorney who is authorized in writing to act on behalf of the
Holder). To permit registrations of transfers and exchanges, the Company shall
execute and the Trustee shall authenticate Notes at the Registrar's request. No
service charge shall be made for any registration of transfer or exchange or
redemption of the Notes, but the Company may require payment of a sum
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sufficient to cover any transfer tax or similar governmental charge payable in
connection therewith (other than any such transfer taxes or other similar
governmental charge payable upon exchanges pursuant to Section 2.11, 3.08 or
9.04).
The Registrar shall not be required (i) to issue, register the transfer of
or exchange any Note during a period beginning at the opening of business 15
days before the day of the mailing of a notice of redemption of Notes selected
for redemption under Section 3.03 and ending at the close of business on the day
of such mailing, or (ii) to register the transfer of or exchange any Note so
selected for redemption in whole or in part, except the unredeemed portion of
any Note being redeemed in part.
SECTION 2.07. Book-Entry Provisions for Global Notes. (a) The Global Notes
initially shall (i) be registered in the name of the Depository for such Global
Notes or the nominee of such Depository, and (ii) be delivered to the Trustee as
custodian for such Depository.
Members of, or participants in, the Depository ("Agent Members") shall have
no rights under this Indenture with respect to any Global Note held on their
behalf by the Depository, or the Trustee as its custodian, or under the Global
Note, and the Depository may be treated by the Company, the Trustee and any
agent of the Company or the Trustee as the absolute owner of such Global Note
for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall
prevent the Company, the Trustee or any agent of the Company or the Trustee,
from giving effect to any written certification, proxy or other authorization
furnished by the Depository or impair, as between the Depository and its Agent
Members, the operation of customary practices governing the exercise of the
rights of a holder of any Note. Neither the Company nor the Trustee shall be
liable for any delay by the Depository in identifying the beneficial owners of
the Notes and the Company and the Trustee may conclusively rely on, and shall be
protected in relying on, instructions from the Depository for all purposes
(including with respect to the registration and delivery, and the respective
principal amounts, of any Notes to be issued).
(b) Transfers of a Global Note shall be limited to transfers of such Global
Note in whole, but not in part, to the Depository, its successors or their
respective nominees. Interests of beneficial owners in a Global Note may be
transferred in accordance with the rules and procedures of the Depository. In
addition, Physical Notes shall be transferred to all beneficial owners in
exchange for their beneficial interests in the Global Notes, if (i) the
Depository notifies the Company that it is unwilling or unable to continue as
Depository for the Global Notes, and a successor Depository is not appointed by
the Company within 90 days of such notice, (ii) an Event of Default has occurred
and is continuing and the Registrar has received a request from the Depository
or (iii) in accordance with the rules and procedures of the Depository.
In the event that Certificated Notes are issued with respect to the Global
Notes, Holders in Luxembourg may contact the Transfer Agent in Luxembourg to
arrange for receipt of their Physical Notes. Thereafter, such Holders will be
able to effect transfers
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of their Physical Notes by delivery thereof to such Transfer Agent with
instructions for the transfer of all or part thereof to the proposed transferee
thereof. Based on such instructions, such Transfer Agent will issue one or more
new Physical Notes in appropriate denominations and registered in the
appropriate name(s), for delivery pursuant to such instructions. Such Transfer
Agent will notify the Registrar to record appropriate entries to reflect such
transfers in the Register. The final payment to be made on such Physical Notes
will be made by the Paying Agent in Luxembourg only against delivery thereto of
such Certificated Notes.
(c) Any beneficial interest in one of the Global Notes that is transferred
to a person who takes delivery in the form of an interest in the other Global
Note shall, upon transfer, cease to be an interest in such Global Note and
become an interest in the other Global Note and, accordingly, shall thereafter
be subject to all transfer restrictions, if any, and other procedures applicable
to beneficial interests in such other Global Note for as long as it remains such
an interest.
(d) In connection with any transfer of a portion of the beneficial
interests in the Global Notes to beneficial owners pursuant to paragraph (b) of
this Section 2.07, the Registrar shall reflect on its books and records the date
and a decrease in the principal amount of the Global Notes in an amount equal to
the principal amount of the beneficial interest in the Global Notes to be
transferred, and the Company shall execute, and the Trustee shall authenticate
and deliver, one or more Physical Notes of like tenor and amount.
(e) In connection with the transfer of the entire Global Note to beneficial
owners pursuant to paragraph (b) of this Section 2.07, the Global Note, as the
case may be, shall be deemed to be surrendered to the Trustee for cancellation,
and the Company shall execute, and the Trustee shall authenticate and deliver,
to each beneficial owner identified by the Depository in exchange for its
beneficial interest in the Global Note, as the case may be, an equal aggregate
principal amount of Physical Notes, as the case may be, of authorized
denominations.
(f) Any Physical Note delivered in exchange for an interest in the Global
Note pursuant to paragraph (b) or (d) of this Section 2.07 shall bear the legend
regarding transfer restrictions applicable to the Physical Note set forth in
Section 2.02.
(g) The registered holder of a Global Note may grant proxies and otherwise
authorize any person, including Agent Members and persons that may hold
interests through Agent Members, to take any action which a Holder is entitled
to take under this Indenture or the Notes.
SECTION 2.08. (Intentionally Omitted)
SECTION 2.09. Replacement Notes. If a mutilated Note is surrendered to the
Trustee or if the Holder claims that the Note has been lost, destroyed or
wrongfully taken, the Company shall issue and the Trustee shall authenticate a
replacement Note of like tenor and principal amount and bearing a number not
contemporaneously outstanding;
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provided that the requirements of the second paragraph of Section 2.10 are met.
If required by the Trustee or the Company, an indemnity bond must be furnished
that is sufficient in the judgment of both the Trustee and the Company to
protect the Company, the Trustee or any Agent from any loss that any of them may
suffer if a Note is replaced. The Company may charge such Holder for its
expenses and the expenses of the Trustee in replacing a Note. In case any such
mutilated, lost, destroyed or wrongfully taken Note has become or is about to
become due and payable, the Company in its discretion may pay such Note instead
of issuing a new Note in replacement thereof.
Every replacement Note is an additional obligation of the Company and shall
be entitled to the benefits of this Indenture.
SECTION 2.10. Outstanding Notes. Notes outstanding at any time are all
Notes that have been authenticated by the Trustee except for those cancelled by
it, those delivered to it for cancellation and those described in this Section
2.10 as not outstanding. Further, for purposes of Sections 316(a)(1), 316(a)(2)
and 316(d)(2) of TIA and Section 9.02 hereof, Notes held by Affiliates of the
Company (other than Subsidiaries) shall not be disregarded for purposes of
determining whether the required percentages of Holders have consented to any
amendment or waiver of the terms of this Indenture or the taking of any action
by the Trustee hereunder and the Trustee shall be protected from liability in
relying upon any consent or direction from such Holders.
If a Note is replaced pursuant to Section 2.09, it ceases to be outstanding
unless and until the Trustee and the Company receive proof satisfactory to them
that the replaced Note is held by a bona fide purchaser.
If the Paying Agent (other than the Company or an Affiliate of the Company)
holds on the maturity date money sufficient to pay Notes payable on that date,
then on and after that date such Notes cease to be outstanding and interest on
them shall cease to accrue.
SECTION 2.11. Temporary Notes. Until definitive Notes are ready for
delivery, the Company may prepare and the Trustee shall authenticate temporary
Notes. Temporary Notes shall be substantially in the form of definitive Notes
but may have insertions, substitutions, omissions and other variations
determined to be appropriate by the Officers executing the temporary Notes, as
evidenced by their execution of such temporary Notes. If temporary Notes are
issued, the Company shall cause definitive Notes to be prepared without
unreasonable delay. After the preparation of definitive Notes, the temporary
Notes shall be exchangeable for definitive Notes upon surrender of the temporary
Notes at the office or agency of the Company designated for such purpose
pursuant to Section 4.02, without charge to the Holder. Upon surrender for
cancellation of any one or more temporary Notes the Company shall execute and
the Trustee shall authenticate and deliver in exchange therefor a like principal
amount of definitive Notes of authorized denominations. Until so exchanged, the
temporary Notes shall be entitled to the same benefits under this Indenture as
definitive Notes.
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SECTION 2.12. Cancellation. The Company at any time may deliver to the
Trustee for cancellation any Notes previously authenticated and delivered
hereunder which the Company may have acquired in any manner whatsoever, and may
deliver to the Trustee for cancellation any Notes previously authenticated
hereunder which the Company has not issued and sold. The Registrar and the
Paying Agent shall forward to the Trustee any Notes surrendered to them for
transfer, exchange or payment. The Trustee shall cancel all Notes surrendered
for transfer, exchange, payment or cancellation and shall destroy them in
accordance with its normal procedure. Except as expressly permitted by this
Indenture, the Company may not issue new Notes to replace Notes it has paid in
full or delivered to the Trustee for cancellation.
SECTION 2.13. CUSIP Numbers. The Company in issuing the Notes may use
"CUSIP", "CINS" or "ISIN" numbers (if then generally in use), and the Trustee
shall use CUSIP, CINS or ISIN numbers, as the case may be, in notices of
redemption or exchange as a convenience to Holders; provided that any such
notice shall state that no representation is made as to the correctness of such
numbers either as printed on the Notes or as contained in any notice of
redemption or exchange and that reliance may be placed only on the other
identification numbers printed on the Notes. The Company shall promptly notify
the Trustee of any change in "CUSIP", "CINS" or "ISIN" numbers for the Notes.
Series A Notes shall have a different CUSIP, CINS or ISIN number, as the case
may be, from Series B Notes.
SECTION 2.14. Defaulted Interest. If the Company defaults in a payment of
interest - on the Notes, it shall pay, or shall deposit with the Paying Agent
money in immediately available funds sufficient to pay, the defaulted interest,
plus (to the extent lawful) any interest payable on the defaulted interest, to
the Persons who are Holders on a subsequent special record date. A special
record date, as used in this Section 2.14 with respect to the payment of any
defaulted interest, shall mean the 15th day next preceding the date fixed by the
Company for the payment of defaulted interest, whether or not such day is a
Business Day. At least 15 days before the subsequent special record date, the
Company shall mail to each Holder and to the Trustee a notice that states the
subsequent special record date, the payment date and the amount of defaulted
interest to be paid.
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ARTICLE THREE
REDEMPTION
SECTION 3.01. Right of Redemption. The Notes shall be redeemable, at the
Company's option, in whole or in part, at any time or from time to time, on or
after the Closing Date and prior to maturity, upon not less than 30 nor more
than 60 days' prior notice mailed by first class mail to each Holder's last
address, as it appears in the Security Register. The Redemption Price for the
Notes (expressed in percentages of principal amount), plus accrued and unpaid
interest , if any, to the Redemption Date (subject to the right of Holders of
record on the relevant Regular Record Date that is prior to the Redemption Date
to receive interest due on an Interest Payment Date) shall equal: (i) 102%, if
redeemed prior to November 6, 2003; (ii) 101%, if redeemed on or after November
6, 2003 but prior to November 6, 2004 and (iii) 100%, if redeemed on or after
November 6, 2004.
SECTION 3.02. Notices to Trustee. If the Company elects to redeem Notes
pursuant to Section 3.01, it shall notify the Trustee in writing of the
Redemption Date and the principal amount of Notes to be redeemed.
The Company shall give each notice provided for in this Section 3.02 in an
Officers' Certificate at least 45 days before the Redemption Date (unless a
shorter period shall be satisfactory to the Trustee).
SECTION 3.03. Selection of Notes to Be Redeemed. If less than all of the
Notes are to be redeemed at any time, the Trustee shall select the Notes, or
portions thereof, for redemption in compliance with the requirements of the
principal national securities exchange, if any, on which the Notes are listed
or, if the Notes are not listed on a national securities exchange, on a pro rata
basis, by lot or by such other method as the Trustee in its sole discretion
shall deem to be fair and appropriate; provided that no Note of $1,000 in
principal amount or less shall be redeemed in part.
The Trustee shall make the selection from the Notes outstanding and not
previously called for redemption. Notes in denominations of $1,000 or less in
principal amount may only be redeemed in whole. The Trustee may select for
redemption portions (equal to $1,000 in principal amount or any integral
multiple thereof) of Notes that have denominations larger than $1,000 in
principal amount. Provisions of this Indenture that apply to Notes called for
redemption also apply to portions of Notes called for redemption. The Trustee
shall notify the Company and the Registrar promptly in writing of the Notes or
portions of Notes to be called for redemption.
SECTION 3.04. Notice of Redemption. With respect to any redemption of Notes
pursuant to Section 3.01, at least 30 days but not more than 60 days before a
Redemption Date, the Company shall mail a notice of redemption by first-class
mail to each Holder whose Notes are to be redeemed.
The notice shall identify the Notes to be redeemed and shall state:
(i) the Redemption Date;
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(ii) the Redemption Price;
(iii) the name and address of the Paying Agent;
(iv) that Notes called for redemption must be surrendered to the
Paying Agent in order to collect the Redemption Price;
(v) that, unless the Company defaults in making the redemption
payment, interest on Notes called for redemption ceases to accrue on and
after the Redemption Date and the only remaining right of the Holders is to
receive payment of the Redemption Price plus accrued interest to the
Redemption Date upon surrender of the Notes to the Paying Agent;
(vi) that, if any Note is being redeemed in part, the portion of the
principal amount (equal to $1,000 in principal amount or any integral
multiple thereof) of such Note to be redeemed and that, on and after the
Redemption Date, upon surrender of such Note, a new Note or Notes in
principal amount equal to the unredeemed portion thereof shall be reissued;
and
(vii) that, if any Note contains a CUSIP, CINS or ISIN number as
provided in Section 2.13, no representation is being made as to the
correctness of the CUSIP, CINS or ISIN number either as printed on the
Notes or as contained in the notice of redemption and that reliance may be
placed only on the other identification numbers printed on the Notes.
At the Company's request (which request may be revoked by the Company at
any time prior to the time at which the Trustee shall have given such notice to
the Holders), made in writing to the Trustee at least 45 days (or such shorter
period as shall be satisfactory to the Trustee) before a Redemption Date, the
Trustee shall give the notice of redemption pursuant to Section 3.01 in the name
and at the expense of the Company. If, however, the Company gives such notice to
the Holders, the Company shall concurrently deliver to the Trustee an Officers'
Certificate stating that such notice has been given.
SECTION 3.05. Effect of Notice of Redemption. Once notice of redemption is
mailed, Notes called for redemption become due and payable on the Redemption
Date and at the Redemption Price. Upon surrender of any Notes to the Paying
Agent, such Notes shall be paid at the Redemption Price, plus accrued interest,
if any, to the Redemption Date.
Notice of redemption shall be deemed to be given when mailed, whether or
not the Holder receives the notice. In any event, failure to give such notice,
or any defect therein, shall not affect the validity of the proceedings for the
redemption of Notes held by Holders to whom such notice was properly given.
SECTION 3.06. Deposit of Redemption Price. On or prior to any Redemption
Date, the Company shall deposit with the Paying Agent (or, if the Company is
acting as its own Paying Agent, shall segregate and hold in trust as provided in
Section 2.05) money sufficient to pay the Redemption Price of and accrued
interest on all Notes to be
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redeemed on that date other than Notes or portions thereof called for redemption
on that date that have been delivered by the Company to the Trustee for
cancellation.
SECTION 3.07. Payment of Notes Called for Redemption. If notice of
redemption has been given in the manner provided above, the Notes or portion of
Notes specified in such notice to be redeemed shall become due and payable on
the Redemption Date at the Redemption Price stated therein, together with
accrued interest to such Redemption Date, and on and after such date (unless the
Company shall default in the payment of such Notes at the Redemption Price and
accrued interest to the Redemption Date, in which case the principal, until
paid, shall bear interest from the Redemption Date at the rate prescribed in the
Notes), such Notes shall cease to accrue interest. Upon surrender of any Note
for redemption in accordance with a notice of redemption, such Note shall be
paid and redeemed by the Company at the Redemption Price, together with accrued
interest, if any, to the Redemption Date; provided that installments of interest
whose Stated Maturity is on or prior to the Redemption Date shall be payable to
the Holders registered as such at the close of business on the relevant Regular
Record Date.
SECTION 3.08. Notes Redeemed in Part. Upon surrender of any Note that is
redeemed in part, the Company shall execute and the Trustee shall authenticate
and deliver to the Holder a new Note equal in principal amount to the unredeemed
portion of such surrendered Note.
SECTION 3.09. Mandatory Redemption. The Company shall not be required to
make any mandatory redemption or sinking fund payment with respect to the Notes.
ARTICLE FOUR
COVENANTS
SECTION 4.01. Payment of Notes. The Company shall pay (whether in cash or
through the issuance of a PIK Note as provided herein) the principal of,
premium, if any, and interest on the Notes on the dates and in the manner
provided in the Notes and this Indenture. An installment of principal, premium,
if any, or interest shall be considered paid on the date due if the Trustee or
Paying Agent (other than the Company, a Subsidiary of the Company, or any
Affiliate of any of them) holds on that date money designated for and sufficient
to pay the installment. If the Company or any Subsidiary of the Company or any
Affiliate of any of them acts as Paying Agent, an installment of principal,
premium, if any, or interest shall be considered paid on the due date if the
entity acting as Paying Agent complies with the last sentence of Section 2.05.
In accordance with Section 6.09, upon any bankruptcy or reorganization procedure
relative to the Company, the Trustee shall serve as the Paying Agent, if any,
for the Notes.
During the PIK Period, unless the Company notifies the Trustee prior to the
Regular Record Date for the applicable Interest Payment Date that the Company
elects to pay interest in cash, the Company shall pay interest through the
issuance of a PIK Note in a principal amount equal to the amount of accrued but
unpaid interest then due. If, during
- 27 -
the PIK Period, the Company pays accrued interest through the issuance of a PIK
Note, the amount of interest then due and owing on the applicable Interest
Payment Date during the PIK Period and, therefore, the principal amount of the
PIK Note to be issued, shall be calculated at the rate of 13% per annum. If,
during the PIK Period, the Company elects to pay accrued but unpaid interest in
cash, the amount of interest then due and owing on the applicable Interest
Payment Date shall be calculated at the rate of 11% per annum. At all times
after the PIK Period, the Company shall pay interest on the Notes in cash at the
rate of 12% per annum until November 30, 2009. Each PIK Note shall bear interest
at the same rate, and such interest shall be payable in cash or through the
issuance of a PIK Note in the same manner, as a Note. Unless otherwise expressly
set forth herein, each PIK Note issued hereunder shall be entitled to all of the
benefits and protections of this Indenture. To the extent interest is paid
through the issuance of a PIK Note, a PIK Note shall be issued to each Holder of
record of Notes at the close of business on May 15 or November 15 immediately
preceding the applicable Interest Payment Date in the same form for delivery in
the same manner as the Note(s) held by such Holder in a principal amount equal
to the accrued interest then due such Holder in accordance herewith. Each PIK
Note shall be duly executed by the Company and authenticated by the Trustee in
accordance with the procedures set forth for Notes in Article Two hereof.
The Company shall pay interest on overdue principal, premium, if any, and
interest on overdue installments of interest, to the extent lawful, at the rate
per annum specified in the Notes.
SECTION 4.02. Maintenance of Office or Agency. The Company shall maintain
in the Borough of Manhattan, The City of New York, an office or agency where
Notes may be surrendered for registration of transfer or exchange or for
presentation for payment and where notices and demands to or upon the Company in
respect of the Notes and this Indenture may be served. The Company shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Company shall fail to
maintain any such required office or agency or shall fail to furnish the Trustee
with the address thereof, such presentations, surrenders, notices and demands
may be made or served at the address of the Trustee set forth in Section 11.02.
The Company may also from time to time designate one or more other offices
or agencies where the Notes may be presented or surrendered for any or all such
purposes and may from time to time rescind such designations; provided 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 initially designates the Corporate Trust Office of the
Trustee as such office of the Company in accordance with Section 2.04.
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SECTION 4.03. Limitation on Indebtedness. (a) The Company shall not, and
shall not permit any of its Subsidiaries to, Incur any Indebtedness except as
follows:
(i) Existing Indebtedness;
(ii) Indebtedness outstanding at any time in an aggregate principal amount
not to exceed $55.5 million pursuant to the Credit Facilities, less any amounts
of such Indebtedness permanently repaid as provided under Sections 4.10, 4.20
and 4.21;
(iii) Indebtedness owed (A) to the Company and evidenced by an
unsubordinated promissory note or (B) to any Subsidiary; provided that any event
which results in any such Subsidiary ceasing to be a Subsidiary or any
subsequent transfer of such Indebtedness (other than to the Company or another
Subsidiary) shall be deemed, in each case, to constitute an Incurrence of such
Indebtedness not permitted by this clause (iii);
(iv) Indebtedness issued in exchange for, or the net proceeds of which are
used to refinance or refund, then outstanding Indebtedness (other than
Indebtedness Incurred under clause (i), (ii), (iii), (vi), or (vii) of this
paragraph) and any refinancings thereof in an amount not to exceed the amount so
refinanced or refunded plus premiums, accrued interest, fees and expenses; and
provided further that: (A) Indebtedness the proceeds of which are used to
refinance or refund the Notes or Indebtedness that is pari passu in right of
payment with, or subordinated in right of payment to, the Notes shall only be
permitted under this clause (iv) if (x) in case the Notes are refinanced in part
or the Indebtedness to be refinanced is pari passu in right of payment with the
Notes, such new Indebtedness, by its terms or by the terms of any agreement or
instrument pursuant to which such new Indebtedness is outstanding, is expressly
made pari passu in right of payment with, or subordinate in right of payment to,
the remaining Notes, or (y) in case the Indebtedness to be refinanced is
subordinated in right of payment to the Notes, such new Indebtedness, by its
terms or by the terms of any agreement or instrument pursuant to which such new
Indebtedness is issued or remains outstanding, is expressly made subordinate in
right of payment to the Notes at least to the extent that the Indebtedness to be
refinanced is subordinated to the Notes; and (B) such new Indebtedness,
determined as of the date of Incurrence of such new Indebtedness, does not
mature prior to the Stated Maturity of the Indebtedness to be refinanced or
refunded, and the Average Life of such new Indebtedness is at least equal to the
remaining Average Life of the Indebtedness to be refinanced or refunded; and
provided further that in no event may Indebtedness of the Company be refinanced
by means of any Indebtedness incurred by any Subsidiary pursuant to this clause
(iv);
(v) Indebtedness (A) in respect of performance, surety or appeal bonds
provided in the ordinary course of business, (B) under Currency Agreements and
Interest Rate Agreements; provided that such agreements (x) are designed solely
to protect the Company or its Subsidiaries against fluctuations in foreign
currency exchange rates or interest rates and (y) do not increase the
Indebtedness of the obligor outstanding at any time other than as a result of
fluctuations in foreign currency exchange rates or interest rates or by reason
of fees, indemnities and compensation payable thereunder or (C)
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arising from agreements providing for indemnification, adjustment of purchase
price or similar obligations, or from Guarantees or letters of credit, surety
bonds or performance bonds securing any obligations of the Company or any of its
Subsidiaries pursuant to such agreements, in each case Incurred in connection
with the disposition of any business, assets or Subsidiary (other than
Guarantees of Indebtedness Incurred by any Person acquiring all or any portion
of such business, assets or Subsidiary for the purpose of financing such
acquisition), in a principal amount not to exceed the gross proceeds actually
received by the Company or any Subsidiary in connection with such disposition;
(vi) Indebtedness of the Company, to the extent the net proceeds thereof
are promptly (A) used to purchase all Notes tendered in an Offer to Purchase
made as a result of a Change of Control or (B) deposited to defease all
outstanding Notes under Article Eight;
(vii) (A) Guarantees of Indebtedness of the Company or any Subsidiary by
any Subsidiary, provided the Guarantee of such Indebtedness is permitted by and
made in accordance with Section 4.07 and (B) Guarantees by the Company of (x)
the Amended CoBank Facility and any permitted refinancing thereof, (y) any
refinancing of the Amended and Restated Wachovia Facility, and (z) other
Indebtedness permitted to be Incurred by Subsidiaries after the Closing Date;
(viii) Indebtedness in an aggregate principal amount outstanding at any
time not to exceed $20.0 million (including any refinancings of such
Indebtedness permitted under clause (iv) above) and Incurred by any Subsidiary
to finance the cost (including the cost of design, development, acquisition,
construction, installation, improvement, transportation or integration) to
acquire equipment, inventory or network assets (including acquisitions by way of
Capitalized Lease), which Indebtedness shall be without recourse to any Person
other than the Subsidiary incurring such Indebtedness; provided that no more
than $10.0 million of the $20.0 million may be Indebtedness Incurred other than
in connection with government financing Incurred by a Subsidiary of the Company
(A) whose only assets shall be those acquired in connection with the government
financing, and (B) which government financing shall be without recourse to the
Company and any Person other than such Subsidiary; and
(ix) Notes issued to the financial advisor for the Informal Noteholders'
Committee as partial satisfaction of its fee in an aggregate principal amount
not to exceed $1.5 million.
(b) Notwithstanding any other provision of this Section 4.03, the maximum
amount of Indebtedness that may be Incurred pursuant to this Section 4.03 shall
not be deemed to be exceeded, with respect to any outstanding Indebtedness, due
solely to the result of fluctuations in the exchange rates of currencies.
(c) For purposes of determining any particular amount of Indebtedness under
this Section 4.03, (i) Liens or obligations with respect to letters of credit
supporting Indebtedness otherwise included in the determination of such
particular amount shall not be included and (ii) any Liens granted pursuant to
the equal and ratable provisions
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referred to in Section 4.09 shall not be treated as Indebtedness. For purposes
of determining compliance with this Section 4.03, in the event that an item of
Indebtedness meets the criteria of more than one of the types of Indebtedness
described in the above clauses, the Company, in its sole discretion, shall
classify such item of Indebtedness and only be required to include the amount
and type of such Indebtedness in one of such clauses.
SECTION 4.04. Limitation on Restricted Payments. The Company shall not, and
shall not permit any Subsidiary to, directly or indirectly, (i) declare or pay
any dividend or make any distribution on or with respect to its Capital Stock
(other than dividends or distributions payable solely in shares of its Capital
Stock (other than Redeemable Stock) or in options, warrants or other rights to
acquire shares of such Capital Stock) held by Persons other than the Company or
any of its Subsidiaries; (ii) purchase, redeem, retire or otherwise acquire for
value any shares of Capital Stock of (x) the Company (including options,
warrants or other rights to acquire such shares of Capital Stock) held by any
Person or (y) a Subsidiary (including options, warrants or other rights to
acquire such shares of Capital Stock) held by any Person (other than the Company
or a Wholly Owned Subsidiary); (iii) make any voluntary or optional principal
payment, or voluntary or optional redemption, repurchase, defeasance, or other
acquisition or retirement for value, of Indebtedness of the Company that is
subordinated in right of payment to the Notes; or (iv) make any Investment,
other than a Permitted Investment, in any Person (such payments or any other
actions described in clauses (i) through (iv) above being collectively
"Restricted Payments") if, at the time of, and after giving effect to, the
proposed Restricted Payment: (A) a Default or Event of Default shall have
occurred and be continuing, (B) the aggregate amount of all Restricted Payments
(the amount, if other than in cash, to be determined in good faith by the Board
of Directors, whose determination shall be conclusive and evidenced by a Board
Resolution) made after the Closing Date shall exceed the sum of (1) the
aggregate Net Cash Proceeds received by the Company after the Closing Date from
a capital contribution or the issuance and sale permitted by this Indenture to a
Person who is not a Subsidiary of the Company of (a) its Capital Stock (other
than Redeemable Stock), (b) any options, warrants or other rights to acquire
Capital Stock of the Company other than Redeemable Stock or any options,
warrants or other rights that are redeemable at the option of the holder, or are
required to be redeemed, prior to the Stated Maturity of the Notes) and (c)
Indebtedness of the Company that has been exchanged for or converted into
Capital Stock of the Company (other than Redeemable Stock), plus (2) an amount
equal to the net reduction in Investments (other than reductions in Permitted
Investments) in an amount not to exceed the amount of Investments previously
made by the Company or any Subsidiary in such Person.
The foregoing provisions shall not be violated by reason of:
(i) the payment of any dividend within 60 days after the date of
declaration thereof if, at such date of declaration, such payment would comply
with the foregoing paragraph;
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(ii) the redemption, repurchase, defeasance or other acquisition or
retirement for value of Indebtedness that is subordinated in right of payment to
the Notes, including premium, if any, and accrued and unpaid interest, with the
proceeds of, or in exchange for, Indebtedness Incurred under Section
4.03(a)(iv);
(iii) the repurchase, redemption or other acquisition of Capital Stock of
the Company (or options, warrants or other rights to acquire such Capital Stock)
in exchange for, or out of the proceeds of a substantially concurrent offering
of, shares of Capital Stock (other than Redeemable Stock) of the Company (or
options, warrants or other rights to acquire such Capital Stock);
(iv) the making of any principal payment or the repurchase, redemption,
retirement, defeasance or other acquisition for value of Indebtedness of the
Company which is subordinated in right of payment to the Notes in exchange for,
or out of the proceeds of, a substantially concurrent offering of shares of the
Capital Stock (other than Redeemable Stock) of the Company (or options, warrants
or other rights to acquire such Capital Stock);
(v) payments or distributions to dissenting stockholders pursuant to
applicable law in connection with a consolidation, merger or transfer of assets
that complies with Article Five;
(vi) the purchase, redemption, acquisition, cancellation or other
retirement for value of shares of Capital Stock of the Company and the making of
other Restricted Payments to the extent necessary, in the reasonable good faith
judgment of the Board of Directors, to prevent the loss or secure the renewal or
reinstatement of any license or franchise held by the Company or any Subsidiary
from any governmental agency that are necessary for the conduct of business of
the Company or the applicable Subsidiary;
(vii) the purchase, redemption, retirement or other acquisition for value
of shares of Capital Stock of the Company, or options to purchase such shares,
held by directors, employees, or former directors or employees of the Company or
any Subsidiary (or their estates or beneficiaries under their estates) upon
their death, disability, retirement, termination of employment or pursuant to
the terms of any agreement under which such shares of Capital Stock or options
were issued; provided that the aggregate consideration paid for such purchase,
redemption, retirement or other acquisition for value of such shares of Capital
Stock or options after the Closing Date does not exceed $1.0 million in any
calendar year, or $2.0 million in the aggregate during the period any Notes are
outstanding; and
(viii) Investments acquired as a capital contribution to the Company or in
exchange for Capital Stock (other than Redeemable Stock) of the Company;
provided that, except in the case of clauses (i), (iii) and (iv), no Default or
Event of Default shall have occurred and be continuing or would occur as a
consequence of the actions or payments described above.
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Each Restricted Payment permitted pursuant to the preceding paragraph
(other than the Restricted Payment referred to in clause (ii) thereof, an
exchange of Capital Stock for Capital Stock or Indebtedness referred to in
clause (iii) or (iv) thereof and an Investment referred to in clause (viii)
thereof), and the Net Cash Proceeds from any issuance of Capital Stock referred
to in clauses (iii) and, (iv) thereof, shall be included in calculating whether
the conditions of clause (B) of the first paragraph of this Section 4.04 have
been met with respect to any subsequent Restricted Payments. In the event the
proceeds of an issuance of Capital Stock of the Company are used for the
redemption, repurchase or other acquisition of the Notes, or Indebtedness of the
Company or its Subsidiaries, then the Net Cash Proceeds of such issuance shall
be included in clause (B) of the first paragraph of this Section 4.04 only to
the extent such proceeds are not used for such redemption, repurchase or other
acquisition of Indebtedness.
SECTION 4.05. Limitation on Dividend and Other Payment Restrictions
Affecting Subsidiaries. The Company shall not, and shall not permit any
Subsidiary to, create or otherwise cause or suffer to exist or become effective
any consensual encumbrance or restriction of any kind on the ability of any
Subsidiary to (i) pay dividends or make any other distributions permitted by
applicable law on any Capital Stock of such Subsidiary owned by the Company or
any other Subsidiary, (ii) pay any Indebtedness owed to the Company or any other
Subsidiary, (iii) make loans or advances to the Company or any other Subsidiary
or (iv) transfer any of its property or assets to the Company or any other
Subsidiary (the items set forth in clauses (i) through (iv) referred to as
"Subsidiary Transfers").
The foregoing provisions shall not restrict any encumbrances or
restrictions:
(i) existing on the Closing Date in this Indenture or any other agreements
in effect on the Closing Date (other than the Old Notes Indenture), and any
extensions, refinancings, renewals or replacements of such agreements; provided
that the encumbrances and restrictions in any such extensions, refinancings,
renewals or replacements are no less favorable in any material respect to the
Holders than those encumbrances or restrictions that are then in effect and that
are being extended, refinanced, renewed or replaced;
(ii) existing under or by reason of applicable law;
(iii) existing with respect to any Person or the property or assets of such
Person acquired by the Company or any Subsidiary and existing at the time of
such acquisition and not incurred in contemplation thereof, which encumbrances
or restrictions are not applicable to any Person or the property or assets of
any Person other than such Person or the property or assets of such Person so
acquired;
(iv) in the case of clause (iv) of the first paragraph of this Section 4.05
(A) that restrict in a customary manner the subletting, assignment or transfer
of any property or asset that is a lease, license, conveyance or contract or
similar property or asset, (B) existing by virtue of any transfer of, agreement
to transfer, option or right with respect to, or Lien on, any property or assets
of the Company or any Subsidiary not otherwise
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prohibited by this Indenture or (C) arising or agreed to in the ordinary course
of business, not relating to any Indebtedness, and that do not, individually or
in the aggregate, detract from the value of property or assets of the Company or
any Subsidiary in any manner material to the Company or any Subsidiary;
(v) with respect to a Subsidiary and imposed pursuant to a bona fide
agreement with an unaffiliated third party that has been entered into for the
sale or disposition of all or substantially all of the Capital Stock of, or
property and assets of, such Subsidiary;
(vi) contained in the terms of any Indebtedness or any agreement pursuant
to which such Indebtedness was issued if (A) the encumbrance or restriction
applies only in the event of a payment default contained in such Indebtedness or
agreement; (B) the encumbrance or restriction is not materially more
disadvantageous to the Holders than is customary in comparable financings (as
determined in good faith by the Board of Directors in its reasonable judgment);
and (C) the Company determines (as evidenced by a resolution of the Board of
Directors) that any such encumbrance or restriction is not reasonably expected
to materially affect the Company' s ability to make principal or interest
payments on the Notes.
Nothing contained in this Section 4.05 shall prevent the Company or any
Subsidiary from (1) creating, incurring, assuming or suffering to exist any
Liens otherwise permitted in Section 4.09 or (2) restricting the sale or other
disposition of property or assets of the Company or any of its Subsidiaries that
secure Indebtedness of the Company or any of its Subsidiaries.
SECTION 4.06. Limitation on the Issuance and Sale of Capital Stock of
Subsidiaries. The Company shall not sell, and shall not permit any Subsidiary,
directly or indirectly, to issue or sell, any shares of Capital Stock of a
Subsidiary (including options, warrants or other rights to purchase shares of
such Capital Stock) except (i) to the Company or a Wholly Owned Subsidiary; (ii)
issuances of director' s qualifying shares, or sales to foreign nationals of
shares of Capital Stock of foreign Subsidiaries, to the extent required by
applicable law; (iii) if, immediately after giving effect to such issuance or
sale, such Subsidiary would no longer constitute a Subsidiary and any Investment
in such Person remaining after giving effect to such issuance or sale would have
been permitted to be made under Section 4.04 if made on the date of such
issuance or sale; or (iv) issuances or sales of Common Stock of a Subsidiary,
provided that the Company or such Subsidiary applies the Net Cash Proceeds, if
any, of any such sale in accordance with clause (A) or (B) of the first
paragraph of Section 4.10.
SECTION 4.07. Limitation on Issuances of Guarantees by Subsidiaries. The
Company shall not permit any Subsidiary, directly or indirectly, to Guarantee
any Indebtedness of the Company which is pari passu in right of payment with, or
subordinate in right of payment to, the Notes ("Guaranteed Indebtedness"),
unless (i) such Subsidiary simultaneously executes and delivers a supplemental
indenture to this Indenture providing for a Guarantee (a "Subsidiary Guarantee")
of payment of the Notes by such Subsidiary; and (ii) such Subsidiary waives, and
shall not in any manner whatsoever claim or take the benefit or advantage of,
any rights of reimbursement,
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indemnity or subrogation or any other rights against the Company or any other
Subsidiary as a result of any payment by such Subsidiary under its Subsidiary
Guarantee; provided that this paragraph shall not be applicable to (x) any
Guarantee of any Subsidiary that existed at the time such Person became a
Subsidiary and was not Incurred in connection with, or in contemplation of, such
Person becoming a Subsidiary or (y) any Guarantee of any Subsidiary of
Indebtedness Incurred under the Credit Facilities permitted by this Indenture.
If the Guaranteed Indebtedness is (A) pari passu in right of payment with the
Notes, then the Guarantee of such Guaranteed Indebtedness shall be pari passu in
right of payment with, or subordinated in right of payment to, the Subsidiary
Guarantee or (B) subordinated in right of payment to the Notes, then the
Guarantee of such Guaranteed Indebtedness shall be subordinated in right of
payment to the Subsidiary Guarantee at least to the extent that the Guaranteed
Indebtedness is subordinated in right of payment to the Notes.
Notwithstanding the foregoing, any Subsidiary Guarantee may provide by its
terms that it shall be automatically and unconditionally released and discharged
upon (i) any sale, exchange or transfer, to any Person not an Affiliate of the
Company, of all of the Company's and each Subsidiary' s Capital Stock in, or all
or substantially all the assets of, such Subsidiary (which sale, exchange or
transfer is not prohibited by this Indenture) or (ii) the release or discharge
of the Guarantee which resulted in the creation of such Subsidiary Guarantee,
except a discharge or release by or as a result of payment under such Guarantee.
SECTION 4.08. Limitation on Transactions with Stockholders and Affiliates.
The Company shall not, and shall not permit any Subsidiary to, directly or
indirectly, enter into, renew or extend any transaction (including, without
limitation, the purchase, sale, lease or exchange of property or assets, or the
rendering of any service) with any holder (or any Affiliate of such holder) of
5% or more of any class of Capital Stock of the Company or with any Affiliate of
the Company or any Subsidiary, except upon fair and reasonable terms no less
favorable in any material respect to the Company or such Subsidiary than could
be obtained, at the time of such transaction or, if such transaction is pursuant
to a written agreement, at the time of the execution of the agreement providing
therefor, in a comparable arm's-length transaction with a Person that is not
such a holder or an Affiliate.
The foregoing limitation does not limit, and shall not apply to: (i)
transactions (A) approved by a majority of the disinterested members of the
Board of Directors and the independent director designated by the holders of
Series D Preferred Stock of the Company, other than SCANA and the ▇▇▇▇▇▇
Partnerships if such independent director is then serving on the Board of
Directors or (B) for which the Company or a Subsidiary delivers to the Trustee a
written opinion of a nationally recognized investment banking firm stating that
the transaction is fair to the Company or such Subsidiary from a financial point
of view; (ii) any transaction solely between the Company and any of its Wholly
Owned Subsidiaries or solely between Wholly Owned Subsidiaries; (iii) the
payment of reasonable and customary regular fees to directors of the Company who
are not employees of the Company; (iv) any payments or other transactions
pursuant to any tax-sharing agreement between the Company and any other Person
with which the
- 35 -
Company files a consolidated tax return or with which the Company is part of a
consolidated group for tax purposes; or (v) any Restricted Payments not
prohibited by Section 4.04. Notwithstanding the foregoing, any transaction
covered by the first paragraph of this Section 4.08 and not covered by clauses
(ii) through (v) of this paragraph, the aggregate amount of which exceeds $5.0
million in value, must be approved or determined to be fair in the manner
provided for in clause (i)(A) or (B) above.
SECTION 4.09. Limitation on Liens. The Company shall not, and shall not
permit any Subsidiary to, create, incur, assume or suffer to exist any Lien on
any of its assets or properties of any character, or any shares of Capital Stock
or Indebtedness of any Subsidiary, without making effective provision for all of
the Notes and all other amounts due under this Indenture to be directly secured
equally and ratably with (or, if the obligation or liability to be secured by
such Lien is subordinated in right of payment to the Notes, prior to) the
obligation or liability secured by such Lien.
The foregoing limitation does not apply to: (i) Liens existing on the
Closing Date; (ii) Liens granted after the Closing Date on any assets or Capital
Stock of the Company or its Subsidiaries created in favor of the Holders; (iii)
Liens with respect to the assets of a Subsidiary granted by such Subsidiary to
the Company or a Wholly Owned Subsidiary to secure Indebtedness owing to the
Company or such other Subsidiary; (iv) Liens securing Indebtedness which is
Incurred to refinance secured Indebtedness which is permitted to be Incurred
under Section 4.03(a)(iv); provided that such Liens do not extend to or cover
any property or assets of the Company or any Subsidiary other than the property
or assets securing the Indebtedness being refinanced; (v) Liens securing
Indebtedness permitted pursuant to this Indenture' s covenants and other
permitted obligations under permitted Credit Facilities; or (vi) Permitted
Liens.
SECTION 4.10. Limitation on Asset Sales. The Company shall not, and shall
not permit any Subsidiary to, complete any Asset Sale, unless (i) the
consideration received by the Company or such Subsidiary is at least equal to
the fair market value of the assets sold or disposed of and (ii) at least 75% of
the consideration received consists of cash or Temporary Cash Investments. In
the event and to the extent that the Net Cash Proceeds received by the Company
or any of its Subsidiaries from one or more Asset Sales occurring on or after
the Closing Date in any period of 12 consecutive months exceed $1.0 million,
then the Company shall or shall cause the relevant Subsidiary to: (i) within 12
months after the date Net Cash Proceeds so received (A) apply an amount equal to
such excess Net Cash Proceeds to permanently repay Indebtedness under Credit
Facilities or any other Indebtedness of any Subsidiary thereof, or (B) invest an
amount equal to such excess Net Cash Proceeds, or the amount of such Net Cash
Proceeds not so applied pursuant to clause (A) (or enter into a definitive
agreement committing to so invest within 12 months after the date of such
agreement), in capital assets of a nature or type or that are used in a business
(or in a Person having capital assets of a nature or type, or engaged in a
business) similar or related to the nature or type of the property and assets
of, or the business of, the Company and its Subsidiaries existing on the date of
such investment (as determined in good faith by the Board of Directors in its
reasonable judgment, whose determination shall be conclusive and evidenced by a
Board Resolution); and (ii) apply
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(no later than the end of the 12-month period referred to in clause (i)) such
excess Net Cash Proceeds (to the extent not applied pursuant to clause (i)) as
provided in the following paragraph of this Section 4.10. The amount of such
excess Net Cash Proceeds required to be applied (or to be committed to be
applied) during such 12-month period as set forth in clause (i) of the preceding
sentence and not applied as so required by the end of such period shall
constitute "Excess Proceeds."
If, as of the first day of any calendar month, the aggregate amount of
Excess Proceeds not theretofore subject to an Offer to Purchase pursuant to this
Section 4.10 totals at least $1.0 million, the Company shall commence, not later
than the fifteenth Business Day of such month, an Offer to Purchase from the
Holders on a pro rata basis an aggregate principal amount of Notes equal to the
Excess Proceeds on such date, at a purchase price equal to 100% of the aggregate
principal amount of the Notes on the relevant Payment Date plus, in each case,
accrued interest (if any) to the Payment Date and complete such Offer to
Purchase in accordance with its terms.
SECTION 4.11. Repurchase of Notes upon a Change of Control. The Company
shall commence, within 30 days after the occurrence of a Change of Control, and
consummate an Offer to Purchase for all Notes then outstanding, at a purchase
price equal to 101% (or, if such Change of Control occurs on or after November
6, 2004, 100%) of the principal amount thereof on the relevant Payment Date,
plus accrued and unpaid interest (if any) to the Payment Date.
SECTION 4.12. Existence. Subject to Articles Four and Five, the Company
shall do or cause to be done all things necessary to preserve and keep in full
force and effect its existence and the existence of each of its Subsidiaries in
accordance with the respective organizational documents of the Company and each
such Subsidiary and the rights (whether pursuant to charter, partnership
certificate, agreement, statute or otherwise), material licenses and franchises
of the Company and each such Subsidiary; provided that the Company shall not be
required to preserve any such right, license or franchise, or the existence of
any Subsidiary, if the maintenance or preservation thereof is no longer
desirable in the conduct of the business of the Company and its Subsidiaries
taken as a whole.
SECTION 4.13. Payment of Taxes and Other Claims. The Company shall pay or
discharge and shall cause each of its Subsidiaries to pay or discharge, or cause
to be paid or discharged, before the same shall become delinquent (i) all
material taxes, assessments and governmental charges levied or imposed upon (a)
the Company or any such Subsidiary, (b) the income or profits of any such
Subsidiary which is a corporation or (c) the property of the Company or any such
Subsidiary and (ii) all material lawful claims for labor, materials and supplies
that, if unpaid, might by law become a lien upon the property of the Company or
any such Subsidiary; provided that the Company shall not be required to pay or
discharge, or cause to be paid or discharged, any such tax, assessment, charge
or claim the amount, applicability or validity of which is being contested in
good faith by appropriate proceedings and for which adequate reserves have been
established.
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SECTION 4.14. Maintenance of Properties and Insurance. The Company shall
cause all properties used or useful in the conduct of its business or the
business of any of its Subsidiaries to be maintained and kept in good condition,
repair and working order and supplied with all necessary equipment and shall
cause to be made all necessary repairs, renewals, replacements, betterments and
improvements thereof, all as in the judgment of the Company may be necessary so
that the business carried on in connection therewith may be properly and
advantageously conducted at all times; provided that nothing in this Section
4.14 shall prevent the Company or any such Subsidiary from discontinuing the
use, operation or maintenance of any of such properties or disposing of any of
them, if such discontinuance or disposal is, in the judgment of the Company,
desirable in the conduct of the business of the Company or such Subsidiary.
The Company shall provide or cause to be provided, for itself and its
Subsidiaries, insurance (including appropriate self-insurance) against loss or
damage of the kinds customarily insured against by corporations similarly
situated and owning like properties, including, but not limited to, products
liability insurance and public liability insurance, with reputable insurers or
with the government of the United States of America, or an agency or
instrumentality thereof, in such amounts, with such deductibles and by such
methods as shall be customary for corporations similarly situated in the
industry in which the Company or any such Subsidiary, as the case may be, is
then conducting business.
SECTION 4.15. Notice of Defaults. In the event that the Company becomes
aware of any Default or Event of Default, the Company, promptly after it becomes
aware thereof, shall give written notice thereof to the Trustee.
SECTION 4.16. Compliance Certificates. (a) The Company shall deliver to the
Trustee, within 45 days after the end of each fiscal quarter (90 days after the
end of the last fiscal quarter of each year), an Officers' Certificate stating
whether or not the signers know of any Default or Event of Default that occurred
during such fiscal quarter. In the case of the Officers' Certificate delivered
within 90 days after the end of the Company' s fiscal year, such certificate
shall contain a certification from the principal executive officer, principal
financial officer or principal accounting officer of the Company that a review
has been conducted of the activities of the Company and its Subsidiaries and the
Company's and its Subsidiaries' performance under this Indenture and that the
Company has complied with all conditions and covenants under this Indenture. For
purposes of this Section 4.16(a), such compliance shall be determined without
regard to any period of grace or requirement of notice provided under this
Indenture. If the officers of the Company signing such certificate do know of
such a Default or Event of Default, the certificate shall describe any such
Default or Event of Default and its status. The first certificate to be
delivered pursuant to this Section 4.16(a) shall be for the first fiscal quarter
beginning after the execution of this Indenture.
(b) The Company shall deliver to the Trustee, within 90 days after the end
of the Company' s fiscal year, a certificate signed by the Company's independent
certified public accountants stating (i) that their audit examination has
included a review of the terms of this Indenture and the Notes as they relate to
accounting matters, (ii) that they
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have read the most recent Officers' Certificate delivered to the Trustee
pursuant to paragraph (a) of this Section 4.16 and (iii) whether, in connection
with their audit examination, anything came to their attention that caused them
to believe that the Company was not in compliance with any of the terms,
covenants, provisions or conditions of Article Four and Section 5.01 of this
Indenture as they pertain to accounting matters and, if any Default or Event of
Default has come to their attention, specifying the nature and period of
existence thereof; provided that such independent certified public accountants
shall not be liable in respect of such statement by reason of any failure to
obtain knowledge of any such Default or Event of Default that would not be
disclosed in the course of an audit examination conducted in accordance with
generally accepted auditing standards in effect at the date of such examination.
SECTION 4.17. Commission Reports and Reports to Holders. At all times after
the Closing Date, whether or not the Company is then required to file reports
with the Commission, the Company shall file with the Commission all such reports
and other information as it would be required to file with the Commission by
Section 13(a) or 15(d) under the Exchange Act if it were subject thereto (unless
the Commission will not accept such a filing, in which case the Company shall
provide such documents to the Trustee). The Company shall supply the Trustee and
each Holder or shall supply to the Trustee for forwarding to each such Holder,
without cost to such Holder, copies of such reports and other information;
provided, however, that copies of such reports may omit exhibits, which the
Company shall deliver at its cost to any Holder upon request.
SECTION 4.18. Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it shall not at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of, premium, if any, or interest on the Notes as contemplated herein,
wherever enacted, now or at any time hereafter in force, or that may affect the
covenants or the performance of this Indenture; and (to the extent that it may
lawfully do so) the Company hereby expressly waives all benefit or advantage of
any such law and covenants that it shall not hinder, delay or impede the
execution of any power herein granted to the Trustee, but shall suffer and
permit the execution of every such power as though no such law had been enacted.
SECTION 4.19. Limitation on Sale-Leaseback Transactions. The Company shall
not, and shall not permit any Subsidiary to, enter into any sale-leaseback
transaction involving any of its assets or properties whether now owned or
hereafter acquired, whereby the Company or a Subsidiary sells or transfers such
assets or properties and then or thereafter leases such assets or properties or
any part thereof or any other assets or properties which the Company or such
Subsidiary, as the case may be, intends to use for substantially the same
purpose or purposes as the assets or properties sold or transferred.
The foregoing restriction does not apply to any sale-leaseback transaction
if (i) the transaction is solely between the Company and any Wholly Owned
Subsidiary or solely between Wholly-Owned Subsidiaries; or (ii) the Company or
such Subsidiary, within 12 months after the sale or transfer of any assets or
properties is completed, applies an amount
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not less than the net proceeds received from such sale in accordance with clause
(A) or (B) of the first paragraph of Section 4.10.
SECTION 4.20. Limitation on Use of Revenues.
The Company shall, and shall cause all of and its Subsidiaries to, apply,
within 180 days after receipt thereof, all revenues generated from their
respective operations only to (i) permanently repay Indebtedness of the Company
or any Subsidiary under the Credit Facilities, and any such permanent reductions
shall be effected in accordance with the documents and instruments evidencing
the Credit Facilities, or (ii) fund operating expenses and reasonable capital
expenditures of the Company and its Subsidiaries, or (iii) make Investments and
Restricted Payments permitted under this Indenture.
Any revenues not applied according to the previous paragraph shall
constitute "Excess Revenues." If, as of the first day of any calendar month, the
aggregate amount of Excess Revenues not theretofore subject to an Offer to
Purchase pursuant to this Section 4.20 totals at least $2.0 million, the Company
must commence, not later than the fifteenth Business Day of such month, and
consummate, an Offer to Purchase from the Holders of the Notes on a pro rata
basis an aggregate principal amount of Notes equal to the Excess Revenues on
such date, at a purchase price equal to 100% of the principal amount of the
Notes on the relevant Payment Date plus, in each case, accrued and unpaid
interest (if any) to the Payment Date.
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SECTION 4.21. Excess Liquidity.
If, as of the first day of any calendar month occurring after the New Notes
Issue Date, the Company and its Subsidiaries collectively have cash or cash
equivalents in excess of $50.0 million after the New Notes Issue Date (excluding
proceeds from the issuance of Capital Stock other than Redeemable Stock), the
Company and its Subsidiaries shall apply such excess cash or cash equivalents
first, within five Business Days, to permanently repay Indebtedness of the
Company or its Subsidiaries arising pursuant to the Credit Facilities, such
permanent repayment to be in accordance with the documents and instruments
evidencing such indebtedness, as applicable, and second, after all such
Indebtedness has been paid in full and any commitments in respect thereof have
been terminated, to make, within 15 Business Days, an Offer to Purchase from the
Holders of the Notes on a pro rata basis an aggregate principal amount of Notes
equal to such cash or cash equivalents in excess of $50.0 million at a purchase
price equal to 100% of the principal amount of the Notes on the relevant Payment
Date plus accrued and unpaid interest (if any) thereon to the Payment Date;
provided, however, that the Company shall not be required to make such an Offer
to Purchase until such time such excess cash or cash equivalents exceeds $1.0
million in excess of $50.0 million.
SECTION 4.22. Limitation on Capital Expenditures of the Company.
The Company and its Subsidiaries shall not, in any calendar year, make
capital expenditures for the operations of Knology of Knoxville, Inc.
("Knoxville") in excess of the amounts set forth in the column in Table A below,
entitled "Maximum Knoxville Capital Expenditures," corresponding to such year
(plus any amounts that the Company budgeted in prior years (pursuant to the
"Budgeted Amounts" column set forth in Table A below) that have not been so
expended); provided, however, that the Company and its Subsidiaries shall not,
in any calendar year, make network construction build-out capital expenditures
for the operations of Knoxville in excess of the amounts set forth in Table B
below corresponding to such year (plus any amounts the Company budgeted in prior
years (pursuant to the "Budgeted Amounts" column set forth in Table B below)
that have not been so expended); provided, further, that Net Cash Proceeds from
the sale of Capital Stock of the Company (other than Redeemable Stock) shall not
be subject to the limitations contained in this Section 4.22.
Maximum Knoxville Capital Expenditures
TABLE A
Maximum Knoxville
Year Budgeted Amounts Capital Expenditures
------------------------------------ ---------------- --------------------
2002(a) ............................ $ 9,307,400 $ 9,307,400
2003 ............................... $13,396,000 $15,405,400
2004 ............................... $12,359,000 $14,212,850
2005 ............................... $ 3,387,000 $ 5,080,500
2006 ............................... $ 3,379,000 $ 5,068,500
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2007 ............................... $ 3,391,000 $ 5,086,500
2008 ............................... $ 3,424,000 $ 5,136,000
2009 ............................... $ 3,479,000 $ 5,218,500
TABLE B
Maximum Build-Out
Year Budgeted Amounts Capital Expenditures
------------------------------------ ---------------- --------------------
2002(a) ............................ $ 8,000,000 $ 8,000,000
2003 ............................... $10,000,000 $11,000,000
2004 ............................... $ 8,943,000 $ 9,837,300
2005 ............................... $ 1,000,000 $ 1,000,000
2006 ............................... $ 1,000,000 $ 1,000,000
2007 ............................... $ 1,000,000 $ 1,000,000
2008 ............................... $ 1,000,000 $ 1,000,000
2009 ............................... $ 1,000,000 $ 1,000,000
(a) The Budgeted Amounts and Maximum Knoxville Capital Expenditures for 2002
represent amounts for the six month period ending December 31, 2002.
SECTION 4.23. Limitation on Management Activities. The Company shall not
permit any of its executive officers to serve as an executive officer or
employee of any Person (other than the Company or any Subsidiary thereof) that
engages in the same or competing line of business as is conducted by and its
Subsidiaries in the locations it conducts business as of the Closing Date,
including the provision of telephone, internet or cable television services.
ARTICLE FIVE
SUCCESSOR CORPORATION
SECTION 5.01. When Company May Merge, Etc. The Company shall not
consolidate with, merge with or into, or sell, convey, transfer, lease or
otherwise dispose of all or substantially all of its property and assets (as an
entirety or substantially an entirety in one transaction or a series of related
transactions) to, any Person or permit any Person to merge with or into the
Company unless: (i) the Company shall be the continuing Person, or the Person
(if other than the Company) formed by such consolidation or into which the
Company is merged or that acquired or leased such property and assets of the
Company (the "Surviving Person") shall be a corporation organized and validly
existing under the laws of the United States of America or any jurisdiction
thereof, and shall expressly assume, by a supplemental indenture, executed and
delivered to the Trustee, all of the obligations of the Company on all of the
Notes and under this Indenture; (ii) immediately after giving effect to such
transaction, no Default or Event of Default shall have occurred and be
continuing; (iii) immediately after giving effect to such transaction on a pro
forma basis, the Company or any Person becoming the successor obligor of the
Notes shall have a Consolidated Net Worth equal to or greater than the
Consolidated Net Worth of the
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Company immediately prior to such transaction; and (iv) the Company delivers to
the Trustee an Officers' Certificate (attaching the arithmetic computations to
demonstrate compliance with clause (iii) above) and an Opinion of Counsel, in
each case stating that such consolidation, merger or transfer and such
supplemental indenture comply with this provision and that all conditions
precedent provided for herein relating to such transaction have been complied
with.
SECTION 5.02. Successor Substituted. Upon any consolidation or merger, or
any sale, conveyance, transfer, lease or other disposition of all or
substantially all of the property and assets of the Company in accordance with
Section 5.01, the successor Person formed by such consolidation or into which
the Company is merged or to which such sale, conveyance, transfer, lease or
other disposition is made shall succeed to, and be substituted for, and may
exercise every right and power of, the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein;
provided that the Company shall not be released from its obligation to pay the
principal of, premium, if any, or interest on the Notes in the case of a lease
of all or substantially all of its property and assets.
ARTICLE SIX
DEFAULT AND REMEDIES
SECTION 6.01. Events of Default. An "Event of Default" shall occur with
respect to the Notes if:
(a) the Company defaults in the payment of the principal of (or
premium, if any, on) any Note when the same becomes due and payable upon
acceleration, redemption or otherwise;
(b) the Company defaults in the payment of interest on any Note when
the same becomes due and payable, which default continues for a period of
30 days;
(c) the Company defaults in the performance of or breaches Section
5.01 or fails to make or consummate an Offer to Purchase in accordance with
Sections 4.10, 4.11, 4.20 or 4.21;
(d) the Company defaults in the performance of or breaches any
covenant or agreement of the Company in this Indenture or under the Notes
(other than a default specified in clause (a), (b) or (c) above), which
default or breach continues for a period of 30 consecutive days after
written notice by the Trustee or the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding;
(e) there occurs with respect to any issue or issues of Indebtedness
of the Company or any Significant Subsidiary having an outstanding
principal amount of $5.0 million or more in the aggregate for all such
issues of all such Persons, whether such Indebtedness now exists or shall
hereafter be created, (I) an event of default that has caused the holder
thereof to declare such Indebtedness to
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be due and payable prior to its Stated Maturity and such Indebtedness has
not been discharged in full or such acceleration has not been rescinded or
annulled within 30 days of such acceleration and/or (II) the failure to
make a principal payment when due and such defaulted payment shall not have
been made, waived or extended within 30 days of such payment default;
(f) any final judgment or order (not covered by insurance) for the
payment of money in excess of $5.0 million in the aggregate for all such
final judgments or orders against all such Persons (treating any
deductibles, self-insurance or retention as not so covered) shall be
rendered against the Company or any Significant Subsidiary and shall not be
paid or discharged, and there shall be any period of 30 consecutive days
following entry of the final judgment or order that causes the aggregate
amount for all such final judgments or orders outstanding and not paid or
discharged against all such Persons to exceed $5.0 million during which a
stay of enforcement of such final judgment or order, by reason of a pending
appeal or otherwise, shall not be in effect;
(g) a court having jurisdiction in the premises enters a decree or
order for (I) relief in respect of the Company or any Significant
Subsidiary in an involuntary case under any applicable bankruptcy,
insolvency or other similar law now or hereafter in effect, (II)
appointment of a receiver, liquidator, assignee, custodian, trustee,
sequestrator or similar official of the Company or any Significant
Subsidiary or for all or substantially all of the property and assets of
the Company or any Significant Subsidiary or (III) the winding up or
liquidation of the affairs of the Company or any Significant Subsidiary
and, in each case, such decree or order shall remain unstayed and in effect
for a period of 60 consecutive days; or
(h) the Company or any Significant Subsidiary (I) commences a
voluntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law, (II) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Company or any
Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (III) effects any
general assignment for the benefit of creditors.
SECTION 6.02. Acceleration. If an Event of Default (other than an Event of
Default specified in clause (g) or (h) above that occurs with respect to the
Company) occurs and is continuing under this Indenture, the Trustee or the
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding, by written notice to the Company (and to the Trustee if such notice
is given by the Holders), may, and the Trustee at the request of such Holders
shall, declare the principal amount of, premium, if any, and accrued interest on
the Notes to be immediately due and payable. Upon a declaration of acceleration,
such principal amount, premium, if any, and accrued interest shall be
immediately due and payable. In the event of a declaration of acceleration
because an Event of Default set forth in clause (e) above has occurred and is
continuing,
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such declaration of acceleration shall be automatically rescinded and annulled
if the event of default triggering such Event of Default pursuant to clause (e)
shall be remedied or cured by the Company or the relevant Significant Subsidiary
or waived by the holders of the relevant Indebtedness within 60 days after the
declaration of acceleration with respect thereto. If an Event of Default
specified in clause (g) or (h) above occurs with respect to the Company, the
principal amount of, premium, if any, and accrued interest on the Notes then
outstanding shall ipso facto become and be immediately due and payable without
any declaration or other act on the part of the Trustee or any Holder.
The Holders of at least a majority in principal amount of the outstanding
Notes, by written notice to the Company and to the Trustee, may waive all past
defaults and rescind and annul a declaration of acceleration and its
consequences if (i) all existing Events of Default, other than the nonpayment of
the principal amount of, premium, if any, and interest on the Notes that have
become due solely by such declaration of acceleration, have been cured or waived
and (ii) the rescission would not conflict with any judgment or decree of a
court of competent jurisdiction.
SECTION 6.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may, and at the direction of the Holders of at least a
majority in principal amount of the outstanding Notes shall, pursue any
available remedy by proceeding at law or in equity to collect the payment of the
principal amount of, premium, if any, or interest on the Notes or to enforce the
performance of any provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any of
the Notes or does not produce any of them in the proceeding.
SECTION 6.04. Waiver of Past Defaults. Subject to Sections 6.02, 6.07 and
9.02, the Holders of at least a majority in principal amount of the outstanding
Notes, by written notice to the Company and to the Trustee, may waive an
existing Default or Event of Default and its consequences, except a Default in
the payment of principal of, premium, if any, or interest on any Note as
specified in clause (a) or (b) of Section 6.01 or in respect of a covenant or
provision of this Indenture which cannot be modified or amended without the
consent of the Holder of each outstanding Note affected. Upon any such waiver,
such Default shall cease to exist, and any Event of Default arising therefrom
shall be deemed to have been cured, for every purpose of this Indenture; but no
such waiver shall extend to any subsequent or other Default or Event of Default
or impair any right consequent thereto.
SECTION 6.05. Control by Majority. The Holders of at least a majority in
aggregate principal amount of the outstanding Notes may direct the time, method
and place of conducting any proceeding for any remedy available to the Trustee
or exercising any trust or power conferred on the Trustee. However, the Trustee
may refuse to follow any direction that conflicts with law or this Indenture,
that may involve the Trustee in personal liability, or that the Trustee
determines in good faith may be unduly prejudicial to the rights of Holders of
Notes not joining in the giving of such direction; provided,
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however, that the Trustee and may take any other action it deems proper that is
not inconsistent with any such direction received from Holders of Notes.
SECTION 6.06. Limitation on Suits. A Holder may not pursue any remedy with
respect to this Indenture or the Notes unless:
(i) the Holder gives the Trustee written notice of a continuing Event
of Default;
(ii) the Holders of at least 25% in aggregate principal amount of
outstanding Notes make a written request to the Trustee to pursue the
remedy;
(iii) such Holder or Holders offer (and if requested provide) the
Trustee security or indemnity satisfactory to the Trustee against any
costs, liability or expense;
(iv) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer of security or indemnity; and
(v) during such 60-day period, the Holders of a majority in aggregate
principal amount of the outstanding Notes do not give the Trustee a
direction that is inconsistent with the request. However, such limitations
do not apply to the right of any Holder of a Note to receive payment of the
principal amount of, premium, if any, or interest on, such Note or to bring
suit for the enforcement of any such payment, on or after the due date
expressed in the Notes, which right shall not be impaired or affected
without the consent of the Holder.
For purposes of Section 6.05 of this Indenture and this Section 6.06, the
Trustee shall comply with Section 2.10 of this Indenture in making any
determination of whether the Holders of the required aggregate principal amount
of outstanding Notes have concurred in any request or direction of the Trustee
to pursue any remedy available to the Trustee or the Holders with respect to
this Indenture or the Notes or otherwise under the law.
A Holder may not use this Indenture to prejudice the rights of another
Holder or to obtain a preference or priority over such other Holder. The
limitations set forth in this Section 6.06 shall not apply to the right of any
Holder of a Note to receive payment of the principal amount of, premium, if any,
or interest on, such note or to bring suit for the enforcement of any such
payment, on or after the due date expressed in the Notes, which right shall not
be impaired or affected without the consent of the Holder.
SECTION 6.07. Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder of a Note to receive
payment of the principal of, premium, if any, or interest on, such Note or to
bring suit for the enforcement of any such payment, on or after the due date
expressed in the Notes, shall not be impaired or affected without the consent of
such Holder.
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SECTION 6.08. Collection Suit by Trustee. If an Event of Default in payment
of principal, premium or interest specified in clause (a), (b) or (c) of Section
6.01 occurs and is continuing, the Trustee may recover judgment in its own name
and as trustee of an express trust against the Company or any other obligor of
the Notes for the whole amount of principal, premium, if any, and accrued
interest remaining unpaid, together with interest on overdue principal, premium,
if any, and, to the extent that payment of such interest is lawful, interest on
overdue installments of interest, in each case at the rate specified in the
Notes, and such further amount as shall be sufficient to cover the costs and
expenses of collection, including the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel.
SECTION 6.09. Trustee May File Proofs of Claim. The Trustee may file such
proofs of claim and other papers or documents as may be necessary or advisable
in order to have the claims of the Trustee (including any claim for the
reasonable compensation, expenses, disbursements and advances of the Trustee,
its agents and counsel, and any other amounts due the Trustee under Section
7.07) and the Holders allowed in any judicial proceedings relative to the
Company (or any other obligor of the Notes), its creditors or its property and
shall be entitled and empowered to collect and receive any monies, securities or
other property payable or deliverable upon conversion or exchange of the Notes
or upon any such claims and to distribute the same, and any custodian, receiver,
assignee, trustee, liquidator, sequestrator or other similar official in any
such judicial proceeding is hereby authorized by each Holder to make such
payments to the Trustee and, in the event that the Trustee shall consent to the
making of such payments directly to the Holders, to pay to the Trustee any
amount due to it for the reasonable compensation, expenses, disbursements and
advances of the Trustee, its agents and counsel, and any other amounts due the
Trustee under Section 7.07. Nothing herein contained shall be deemed to empower
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 Notes or the rights of any Holder thereof, or to authorize the
Trustee to vote in respect of the claim of any Holder in any such proceeding.
SECTION 6.10. Priorities. If the Trustee collects any money pursuant to
this Article Six, it shall pay out the money in the following order:
First: to the Trustee for all amounts due under Section 7.07;
Second: to Holders for amounts then due and unpaid for the principal
amount of, premium, if any, and interest on the Notes in respect of which
or for the benefit of which such money has been collected, ratably, without
preference or priority of any kind, according to the amounts due and
payable on such Notes for principal, premium, if any, and interest,
respectively; and
Third: to the Company or any other obligors of the Notes, as their
interests may appear, or as a 'court of competent jurisdiction may direct.
The Trustee, upon prior written notice to the Company, may fix a record
date and payment date for any payment to Holders pursuant to this Section 6.10.
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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 Trustee, a court may require any party litigant
in such suit to file an undertaking to pay the costs of the suit, and the court
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 6.11 does not apply
to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a suit
by Holders of more than 10% in principal amount of the outstanding Notes.
SECTION 6.12. Restoration of Rights and Remedies. If the Trustee or any
Holder has instituted any proceeding to enforce any right or remedy under this
Indenture and such proceeding has been discontinued or abandoned for any reason,
or has been determined adversely to the Trustee or to such Holder, then, and in
every such case, subject to any determination in such proceeding, the Company,
the Trustee and the Holders shall be restored severally and respectively to
their former positions hereunder and thereafter all rights and remedies of the
Company, Trustee and the Holders shall continue as though no such proceeding had
been instituted.
SECTION 6.13. Rights and Remedies Cumulative. Except as otherwise provided
with respect to the replacement or payment of mutilated, destroyed, lost or
wrongfully taken Notes in Section 2.09, no right or remedy herein conferred upon
or reserved to the Trustee or to the Holders is intended to be exclusive of any
other right or remedy, and every right and remedy shall, to the extent permitted
by law, be cumulative and in addition to every other right and remedy given
hereunder or now or hereafter existing at law or in equity or otherwise. The
assertion or employment of any right or remedy hereunder, or otherwise, shall
not prevent the concurrent assertion or employment of any other appropriate
right or remedy.
SECTION 6.14. Delay or Omission Not Waiver. No delay or omission of the
Trustee or of any Holder to exercise any right or remedy accruing upon any Event
of Default shall impair any such right or remedy or constitute a waiver of any
such Event of Default or an acquiescence therein. Every right and remedy given
by this Article Six or by law to the Trustee or to the Holders may be exercised
from time to time, and as often as may be deemed expedient, by the Trustee or by
the Holders, as the case may be.
ARTICLE SEVEN
TRUSTEE
SECTION 7.01. General. The duties and responsibilities of the Trustee shall
be as provided by the TIA and as set forth herein. Notwithstanding the
foregoing, no provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it. Whether or not herein expressly so provided, every provision of
this Indenture relating to the conduct or affecting the liability of or
affording protection to the Trustee shall be subject to the provisions of this
Article Seven.
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SECTION 7.02. Certain Rights of Trustee. Subject to TIA Sections 315(x)
through (d):
(i) the Trustee may rely, and shall be protected in acting or
refraining from acting, upon any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
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 any such document;
(ii) before the Trustee acts or refrains from acting, it may require
an Officers' Certificate or an Opinion of Counsel, which shall conform to
Section 10.03. The Trustee shall not be liable for any action it takes or
omits to take in good faith in reliance on such certificate or opinion;
(iii) the Trustee may act through its attorneys and agents and shall
not be responsible for the misconduct or negligence of any attorney or
agent appointed with due care;
(iv) 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;
(v) 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 its
rights or powers or for any action it takes or omits to take in accordance
with the written direction of the Holders of a majority in principal amount
of the outstanding Notes relating to the time, method and place of
conducting any proceeding for any remedy available to the Trustee, or
exercising any trust or power conferred upon the Trustee, under this
Indenture;
(vi) whenever in the administration of this Indenture the Trustee
shall deem it desirable that a matter be proved or established prior to
taking, suffering or omitting any action hereunder, the Trustee (unless
other evidence be herein specifically prescribed) may, in the absence of
bad faith on its part, rely upon an Officers' Certificate; and
(vii) the Trustee shall not be bound to make any investigation into
the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, report, notice, request, direction, consent, order,
bond, debenture, note, other evidence of indebtedness or other paper or
document, but the Trustee, in its discretion, may make such further inquiry
or investigation into such facts or matters as it may see fit, and, if the
Trustee shall determine to make such further inquiry or investigation, it
shall be entitled to examine the books, records and premises of the Company
personally or by agent or attorney.
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SECTION 7.03. Individual Rights of Trustee. The Trustee, in its individual
or any other capacity, may become the owner or pledgee of Notes and may
otherwise deal with the Company or its Affiliates with the same rights it would
have if it were not the Trustee. Any Agent may do the same with like rights.
However, the Trustee is subject to TIA Sections 310(b) and 311.
SECTION 7.04. Trustee's Disclaimer. The Trustee (i) makes no representation
as to the validity or adequacy of this Indenture or the Notes, (ii) shall not be
accountable for the Company' s use or application of the proceeds from the Notes
and (iii) shall not be responsible for any statement in the Notes other than its
certificate of authentication.
SECTION 7.05. Notice of Default. If any Default or any Event of Default
occurs and is continuing and if such Default or Event of Default is known to a
Responsible Officer of the Trustee, the Trustee shall mail to each Holder in the
manner and to the extent provided in TIA Section 313(c) notice of the Default or
Event of Default within 45 days after it occurs, unless such Default or Event of
Default has been cured; provided, however, that, except in the case of a default
in the payment of the principal of, premium, if any, or interest on any Note,
the Trustee shall be protected in withholding such notice if and so long as the
board of directors, the executive committee or a trust committee of directors
and/or Responsible Officers of the Trustee in good faith determine that the
withholding of such notice is in the interest of the Holders.
SECTION 7.06. Reports by Trustee to Holders. Within 60 days after each May
15, beginning with May 15, 2003, the Trustee shall mail to each Holder as
provided in TIA Section 313(c) a brief report dated as of such May 15, if
required by TIA Section 313(a).
SECTION 7.07. Compensation and Indemnity. The Company shall pay to the
Trustee such compensation as shall be agreed upon in writing for its services.
The compensation of the Trustee shall not be limited by any law on compensation
of a trustee of an express trust. The Company shall reimburse the Trustee upon
request for all reasonable out-of-pocket expenses and advances incurred or made
by the Trustee. Such expenses shall include the reasonable compensation and
expenses of the Trustee's agents and counsel.
The Company shall indemnify the Trustee against any and all losses,
liabilities, obligations, damages, penalties, judgments, actions, suits,
proceedings, reasonable costs and expenses (including reasonable fees and
disbursements of counsel) of any kind whatsoever which may be incurred by the
Trustee in connection with any investigative, administrative or judicial
proceeding (whether or not such indemnified party is designated a party to such
proceeding) arising out of or in connection with the acceptance or
administration of its duties under this indenture; provided, however, that the
Company need not reimburse any expense or indemnify against any loss,
obligation, damage, penalty, judgment, action, suit, proceeding, reasonable cost
or expense (including reasonable fees and disbursements of counsel) of any kind
whatsoever which may be incurred by the Trustee in connection with any
investigative, administrative or judicial proceeding (whether or not such
indemnified party is designated a party to such
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proceeding) in which it is determined that the Trustee acted with negligence,
bad faith or willful misconduct. The Trustee shall notify the Company promptly
of any claim for which it may seek indemnity. Failure by the Trustee to so
notify the Company shall not relieve the Company of its obligations hereunder,
unless the Company is materially prejudiced thereby. The Company shall defend
the claim and the Trustee shall cooperate in the defense. Unless otherwise set
forth herein, 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.
To secure the Company's payment obligations in this Section 7.07, the
Trustee shall have a lien prior to the Notes on all money or property held or
collected by the Trustee, in its capacity as Trustee, except money or property
held in trust to pay principal of, premium, any, and interest on particular
Notes.
If the Trustee incurs expenses or renders services after the occurrence of
an Event of Default specified in clause (g) or (h) of Section 6.01, the expenses
and the compensation for the services shall be intended to constitute expenses
of administration under Title 11 of the United States Bankruptcy Code or any
applicable federal or state law for the relief of debtors.
SECTION 7.08. Replacement of Trustee. A resignation or removal of the
Trustee and appointment of a successor Trustee shall become effective only upon
the successor Trustee' s acceptance of appointment as provided in this Section
7.08.
The Trustee may resign at any time by so notifying the Company in writing
at least 30 days prior to the date of the proposed resignation. The Holders of a
majority in principal amount of the outstanding Notes may remove the Trustee by
so notifying the Trustee in writing and may appoint a successor Trustee with the
consent of the Company. The Company may remove the Trustee if: (i) the Trustee
is no longer eligible under Section 7.10; (ii) the Trustee is adjudged a
bankrupt or an insolvent; (iii) a receiver or other public officer takes charge
of the Trustee or its property; or (iv) 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 of the outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Company. If
the successor Trustee does not deliver its written acceptance required by the
next succeeding paragraph of this Section 7.08 within 30 days after the retiring
Trustee resigns or is removed, the retiring Trustee, the Company or the Holders
of a majority in principal amount of the outstanding Notes may petition any
court of competent jurisdiction for 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. Immediately after the delivery of
such written acceptance, subject to the lien provided in Section 7.07, (i) the
retiring Trustee shall
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transfer all property held by it as Trustee to the successor Trustee, (ii) the
resignation or removal of the retiring Trustee shall become effective and (iii)
the successor Trustee shall have all the rights, powers and duties of the
Trustee under this Indenture. A successor Trustee shall mail notice of its
succession to each Holder.
If the Trustee is no longer eligible under Section 7.10, any Holder who
satisfies the requirements of TIA Section 310(b) may petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor Trustee.
The Company shall give notice of any resignation and any removal of the
Trustee and each appointment of a successor Trustee to all Holders. Each notice
shall include the name of the successor Trustee and the address of its Corporate
Trust Office.
Notwithstanding replacement of the Trustee pursuant to this Section 7.08,
the Company' s obligation under Section 7.07 shall continue for the benefit of
the retiring Trustee.
SECTION 7.09. Successor Trustee by Merger, Etc. If the Trustee consolidates
with, merges or converts into, or transfers all or substantially all of its
corporate trust business to, another corporation or national banking
association, the resulting, surviving or transferee corporation or national
banking association without any further act shall be the successor Trustee with
the same effect as if the successor Trustee had been named as the Trustee
herein.
SECTION 7.10. Eligibility. This Indenture shall always have a Trustee who
satisfies the requirements of TIA Section 310(a)(1). The Trustee shall have a
combined capital and surplus of at least $25.0 million as set forth in its most
recent published annual report of condition.
SECTION 7.11. Money Held in Trust. The Trustee shall not be liable for
interest on any money received by it except as the Trustee may agree with the
Company. Money held in trust by the Trustee need not be segregated from other
funds except to the extent required by law and except for money held in trust
under Article Eight of this Indenture.
SECTION 7.12. Withholding Taxes. The Trustee, as agent for the Company,
shall exclude and withhold from each payment of principal and interest and other
amounts due hereunder or under the Notes any and all withholding taxes
applicable thereto as required by law. The Trustee agrees to act as such
withholding agent and, in connection therewith, whenever any present or future
taxes or similar charges are required to be withheld with respect to any amounts
payable in respect of the Notes, to withhold such amounts and timely pay the
same to the appropriate authority in the name of and on behalf of the Holders of
the Notes, that it shall file any necessary withholding tax returns or
statements when due, and that, as promptly as possible after the payment
thereof, it shall deliver to each Holder of a Note appropriate documentation
showing the payment thereof, together with such additional documentary evidence
as such Holders may reasonably request from time to time.
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ARTICLE EIGHT
DISCHARGE OF INDENTURE
SECTION 8.01. Termination of Company's Obligations. Except as otherwise
provided in this Section 8.01, the Company may terminate its obligations under
the Notes and this Indenture if:
(i) all Notes previously authenticated and delivered (other than
destroyed, lost or stolen Notes that have been replaced or Notes that are
paid pursuant to Section 4.01 or Notes for whose payment money or
securities have theretofore been held in trust and thereafter repaid to the
Company, as provided in Section 8.05) have been delivered to the Trustee
for cancellation and the Company has paid all sums payable by it hereunder;
or
(ii) (A) the Notes mature within one year or all of them are to be
called for redemption within one year under arrangements satisfactory to
the Trustee for giving the notice of redemption, (B) the Company
irrevocably deposits in trust with the Trustee during such one-year period,
under the terms of an irrevocable trust agreement in form and substance
satisfactory to the Trustee, as trust funds solely for the benefit of the
Holders for that purpose, money or U.S. Government Obligations sufficient
(in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee), without consideration of any reinvestment of any interest
thereon, to pay principal, premium, if, any, and interest on the Notes to
maturity or redemption, as the case may be, and to pay all other sums
payable by it hereunder, (C) no Default or Event of Default with respect to
the Notes shall have occurred and be continuing on the date of such
deposit, (D) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound and (E)
the Company has delivered to the Trustee an Officers' Certificate and an
Opinion of Counsel, in each case stating that all conditions precedent
provided for herein relating to the satisfaction and discharge of this
Indenture have been complied with.
With respect to the foregoing clause (i), the Company's obligations under
Section 7.07 shall survive. With respect to the foregoing clause (ii), the
Company' s obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.09,
2.14, 4.01, 4.02, 7.07, 7.08, 8.04, 8.05 and 8.06 shall survive until the Notes
are no longer outstanding. Thereafter, only the Company' s obligations in
Sections 7.07, 8.05 and 8.06 shall survive. After any such irrevocable deposit,
the Trustee upon request shall acknowledge in writing the discharge of the
Company' s obligations under the Notes and this Indenture except for those
surviving obligations specified above.
SECTION 8.02. Defeasance and Discharge of Indenture. The Company shall be
deemed to have paid and shall be discharged from any and all obligations in
respect of the Notes on the 123rd day after the date of the deposit referred to
in clause (A) of this Section 8.02, and the provisions of this Indenture shall
no longer be in effect with respect
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to the Notes, and the Trustee, at the expense of the Company, shall execute
proper instruments acknowledging the same, except as to (i) rights of
registration of transfer and exchange, (ii) substitution of apparently
mutilated, defaced, destroyed, lost or stolen Notes, (iii) rights of Holders to
receive payments of principal thereof and interest thereon, (iv) the Company' s
obligations under Section 4.02, (v) the rights, obligations and immunities of
the Trustee hereunder and (vi) the rights of the Holders as beneficiaries of
this Indenture with respect to the property so deposited with the Trustee
payable to all or any of them; provided that the following conditions shall have
been satisfied:
(A) with reference to this Section 8.02, the Company has irrevocably
deposited or caused to be irrevocably deposited with the Trustee (or
another trustee satisfying the requirements of Section 7.10) and conveyed
all right, title and interest for the benefit of the Holders, under the
terms of an irrevocable trust agreement in form and substance satisfactory
to the Trustee as trust funds in trust, specifically pledged to the Trustee
for the benefit of the Holders as security for payment of the principal of,
premium, if any, and interest, if any, on the Notes, and dedicated solely
to, the benefit of the Holders, in and to (1) money in an amount, (2) U.S.
Government Obligations that, through the payment of interest, premium, if
any, and principal in respect thereof in accordance with their terms, will
provide, not later than one day before the due date of any payment referred
to in this clause (A), money in an amount or (3) a combination thereof in
an amount sufficient, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereof
delivered to the Trustee, to pay and discharge, without consideration of
the reinvestment of such interest and after payment of all federal, state
and local taxes or other charges and assessments in respect thereof payable
by the Trustee, the principal of, premium, if any, and accrued interest on
the outstanding Notes at the Stated Maturity of such principal or interest;
provided that the Trustee shall have been irrevocably instructed to apply
such money or the proceeds of such U.S. Government Obligations to the
payment of such principal, premium, if any, and interest with respect to
the Notes;
(B) such deposit shall not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company or any Subsidiary is a party or by which it
is bound;
(C) immediately after giving effect to such deposit on a pro forma
basis, no Default or Event of Default shall have occurred and be continuing
on the date of such deposit or during the period ending on the 123rd day
after such date of deposit;
(D) the Company shall have delivered to the Trustee (1) either (x) a
ruling directed to the Trustee received from the Internal Revenue Service
to the effect that the Holders will not recognize income, gain or loss for
federal income tax purposes as a result of the Company' s exercise of its
option under this Section 8.02 and will be subject to federal income tax on
the same amount and in the same manner and at the same times as would have
been the case if such option had not been exercised or (y) an Opinion of
Counsel to the same effect as the
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ruling described in clause (x) above accompanied by a ruling to that effect
published by the Internal Revenue Service, unless there has been a change
in the applicable federal income tax law since the date of this Indenture
such that a ruling from the Internal Revenue Service is no longer required
and (2) an Opinion of Counsel to the effect that (x) the creation of the
defeasance trust does not violate the Investment Company Act of 1940 and
(y) after the passage of 123 days following the deposit (except, with
respect to any trust funds for the account of any Holder who may be deemed
to be an "insider" for purposes of the United States Bankruptcy Code, after
one year following the deposit), the trust funds will not be subject to the
effect of ▇▇▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bankruptcy Code or Section 15 of
the New York Debtor and Creditor Law in a case commenced by or against the
Company under either such statute, and either (I) the trust funds will no
longer remain the property of the Company (and therefore will not be
subject to the effect of any applicable bankruptcy, insolvency,
reorganization or similar laws affecting creditors' rights generally) or
(II) if a court were to rule under any such law in any case or proceeding
that the trust funds remained property of the Company, (a) assuming such
trust funds remained in the possession of the Trustee prior to such court
ruling to the extent not paid to the Holders, the Trustee shall hold, for
the benefit of the Holders, a valid and perfected security interest in such
trust funds that is not avoidable in bankruptcy or otherwise except for the
effect of Section 552(b) of the United States Bankruptcy Code on interest
on the trust funds accruing after the commencement of a case under such
statute and (b) the Holders shall be entitled to receive adequate
protection of their interests in such trust funds if such trust funds are
used in such case or proceeding;
(E) if the Notes are then listed on a national securities exchange,
the Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that such deposit, defeasance and discharge will not cause the
Notes to be delisted; and
(F) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, in each case stating that all conditions
precedent provided for herein relating to the defeasance contemplated by
this Section 8.02 have been complied with.
Notwithstanding the foregoing, prior to the end of the 123-day (or one
year) period referred to in clause (D)(2)(y) of this Section 8.02, none of the
Company' s obligations under this Indenture shall be discharged. Subsequent to
the end of such 123-day (or one year) period with respect to this Section 8.02,
the Company' s obligations in Sections 2.02, 2.03, 2.04, 2.05, 2.06, 2.07, 2.09,
2.14, 4.01, 4.02, 7.07, 7.08, 8.05 and 8.06 shall survive until the Notes are no
longer outstanding. Thereafter, only the Company' s obligations in Sections
7.07, 8.05 and 8.06 shall survive. If and when a ruling from the Internal
Revenue Service or an Opinion of Counsel referred to in clause (D)(1) of this
Section 8.02 is able to be provided specifically without regard to, and not in
reliance upon, the continuance of the Company' s obligations under Section 4.01,
then the Company' s obligations under such Section 4.01 shall cease upon
delivery to the Trustee
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of such ruling or Opinion of Counsel and compliance with the other conditions
precedent provided for herein relating to the defeasance contemplated by this
Section 8.02.
After any such irrevocable deposit, the Trustee upon request shall
acknowledge in writing the discharge of the Company's obligations under the
Notes and this Indenture except for those surviving obligations in the
immediately preceding paragraph.
SECTION 8.03. Defeasance of Certain Obligations. The Company may omit to
comply with any term, provision or condition set forth in clauses (iii) and (iv)
of Section 5.01 and Sections 4.03 through 4.17, Section 4.19 and clause (c) of
Section 6.01 with respect to clauses (iii) and (iv) of Section 5.01 and clause
(d) of Section 6.01 with respect to Sections 4.03 through 4.17, Section 4.19 and
clauses (e) and (f) of Section 6.01 shall be deemed not to be Events of Default,
in each case with respect to the outstanding Notes if:
(i) with reference to this Section 8.03, the Company has irrevocably
deposited or caused to be irrevocably deposited with the Trustee (or
another trustee satisfying the requirements of Section 7.10) and conveyed
all right, title and interest to the Trustee for the benefit of the
Holders, under the terms of an irrevocable trust agreement in form and
substance satisfactory to the Trustee as trust funds in trust, specifically
pledged to the Trustee for the benefit of the Holders as security for
payment of the principal of, premium, if any, and interest, if any, on the
Notes, and dedicated solely to, the benefit of the Holders, in and to (A)
money in an amount, (B) U.S. Government Obligations that, through the
payment of interest and principal in respect thereof in accordance with
their terms, will provide, not later than one day before the due date of
any payment referred to in this clause (i), money in an amount or (C) a
combination thereof in an amount sufficient, in the opinion of a nationally
recognized firm of independent public accountants expressed in a written
certification thereof delivered to the Trustee, to pay and discharge,
without consideration of the reinvestment of such interest and after
payment of all federal, state and local taxes or other charges and
assessments in respect thereof payable by the Trustee, the principal of,
premium, if any, and interest on the outstanding Notes on the Stated
Maturity of such principal or interest; provided that the Trustee shall
have been irrevocably instructed to apply such money or the proceeds of
such U.S. Government Obligations to the payment of such principal, premium,
if any, and interest with respect to the Notes;
(ii) such deposit will not result in a breach or violation of, or
constitute a default under, this Indenture or any other agreement or
instrument to which the Company is a party or by which it is bound;
(iii) immediately after giving effect to such deposit on a pro forma
basis, no Default or Event of Default shall have occurred and be continuing
on the date of such deposit or during the period ending on the 123rd day
after such date of deposit;
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(iv) the Company has delivered to the Trustee an Opinion of Counsel to
the effect that (A) the creation of the defeasance trust does not violate
the Investment Company Act of 1940, (B) the Trustee, for the benefit of the
Holders, has a valid first-priority security interest in the trust funds,
(C) the Holders will not recognize income, gain or loss for federal income
tax purposes as a result of such deposit and defeasance of certain
obligations and will be subject to federal income tax on the same amount
and in the same manner and at the same times as would have been the case if
such deposit and defeasance had not occurred and (D) after the passage of
123 days following the deposit (except, with respect to any trust funds for
the account of any Holder who may be deemed to be an "insider" for purposes
of the United States Bankruptcy Code, after one year following the
deposit), the trust funds will not be subject to the effect of ▇▇▇▇▇▇▇ ▇▇▇
▇▇ ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ Bankruptcy Code or Section 15 of the New York Debtor
and Creditor Law in a case commenced by or against the Company under either
such statute, and either (1) the trust funds will no longer remain the
property of the Company (and therefore will not be subject to the effect of
any applicable bankruptcy, insolvency, reorganization or similar laws
affecting creditors' rights generally) or (2) if a court were to rule under
any such law in any case or proceeding that the trust funds remained
property of the Company, (x) assuming such trust funds remained in the
possession of the Trustee prior to such court ruling to the extent not paid
to the Holders, the Trustee shall hold, for the benefit of the Holders, a
valid and perfected security interest in such trust funds that is not
avoidable in bankruptcy or otherwise (except for the effect of Section
552(b) of the United States Bankruptcy Code on interest on the trust funds
accruing after the commencement of a case under such statute) and (y) the
Holders will be entitled to receive adequate protection of their interests
in such trust funds if such trust funds are used in such case or
proceeding;
(v) if the Notes are then listed on a national securities exchange,
the Company shall have delivered to the Trustee an Opinion of Counsel to
the effect that such deposit defeasance and discharge will not cause the
Notes to be delisted; and
(vi) the Company has delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, in each case stating that all conditions
precedent provided for herein relating to the defeasance contemplated by
this Section 8.03 have been complied with.
SECTION 8.04. Application of Trust Money. Subject to Section 8.06, the
Trustee or Paying Agent shall hold in trust money or U.S. Government Obligations
deposited with it pursuant to Section 8.01, 8.02 or 8.03, as the case may be,
and shall apply the deposited money and the money from U.S. Government
Obligations in accordance with the Notes and this Indenture to the payment of
principal of, premium, if any, and interest on the Notes; but such money need
not be segregated from other funds except to the extent required by law.
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SECTION 8.05. Repayment to Company. Subject to Sections 7.07, 8.01, 8.02
and 8.03, the Trustee and the Paying Agent shall promptly pay to the Company
upon request set forth in an Officers' Certificate any excess money held by them
at any time and thereupon shall be relieved from all liability with respect to
such money. The Trustee and the Paying Agent shall pay to the Company upon
request any money held by them for the payment of principal, premium, if any, or
interest that remains unclaimed for two years. After payment to the Company,
Holders entitled to such money must look to the Company for payment as general
creditors unless an applicable law designates another Person, and all liability
of the Trustee and such Paying Agent with respect to such money shall cease.
SECTION 8.06. Reinstatement. If the Trustee or Paying Agent is unable to
apply any money or U.S. Government Obligations in accordance with Section 8.01,
8.02 or 8.03, as the case may be, by reason of any legal proceeding or by reason
of any order or judgment of any court or governmental authority enjoining,
restraining or otherwise prohibiting such application, the Company's obligations
under this Indenture and the Notes shall be revived and reinstated as though no
deposit had occurred pursuant to Section 8.01, 8.02 or 8.03, as the case may be,
until such time as the Trustee or Paying Agent is permitted to apply all such
money or U.S. Government Obligations in accordance with Section 8.01, 8.02 or
8.03, as the case may be; provided that, if the Company has made any payment of
principal of, premium, if any, or interest on any Notes because of the
reinstatement of its obligations, the Company shall be subrogated to the rights
of the Holders of such Notes to receive such payment from the money or U.S.
Government Obligations held by the Trustee or Paying Agent.
SECTION 8.07. Defeasance and Certain Other Events of Default. If, in the
event the Company exercises its options to omit compliance with certain
covenants and provisions due and payable because of an Event of Default that
remains applicable, and the amount of money and/or Government Securities on
deposit with the Trustee is insufficient to pay amounts due on such Notes due to
a declaration of acceleration under Section 6.02, the Company shall remain
liable for such payments.
ARTICLE NINE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01. Without Consent of Holders. The Company, when authorized by a
resolution of its Board of Directors (as evidenced by a Board Resolution
delivered to the Trustee), and the Trustee may amend or supplement this
Indenture or the Notes without notice to or the consent of any Holder, to:
(1) cure any ambiguity, defect or inconsistency in this Indenture;
provided that such amendments or supplements shall not, in the good faith
opinion of the Board of Directors as evidenced by a Board Resolution,
adversely affect the interests of the Holders in any material respect;
(2) comply with Article Five;
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(3) comply with any requirements of the Commission in connection with
the qualification of this Indenture under the TIA;
(4) evidence and provide for the acceptance of appointment hereunder
by a successor Trustee; or
(5) make any change that, in the good faith opinion of the Board of
Directors as evidenced by a Board Resolution, does not materially and
adversely affect the rights of any Holder.
SECTION 9.02. With Consent of Holders. Subject to Sections 6.04 and 6.07
and without prior notice to the Holders, the Company, when authorized by its
Board of Directors (as evidenced by a Board Resolution delivered to the
Trustee), and the Trustee may amend this Indenture and the Notes with the
written consent of the Holders of a majority in aggregate principal amount of
the Notes then outstanding, and the Holders of a majority in aggregate principal
amount of the Notes then outstanding by written notice to the Trustee may waive
future compliance by the Company with any provision of this Indenture and the
Notes.
Notwithstanding the provisions of this Section 9.02, without the consent of
each Holder affected, an amendment or waiver, including a waiver pursuant to
Section 6.04, may not:
(i) change the Stated Maturity of the principal of, or any installment
of interest on, any Note;
(ii) reduce the principal of, or premium, if any, or interest on, any
Note;
(iii) change the place or currency of payment of principal of, or
premium, if any, or interest on, any Note;
(iv) impair the right to institute suit for the enforcement of any
payment on or after the Stated Maturity (or, in the case of a redemption,
on or after the Redemption Date) of any Note;
(v) reduce the above-stated percentage of outstanding Notes the
consent of whose Holders is necessary to modify or amend this Indenture;
(vi) waive a default in the payment of principal of, premium, if any,
or interest on the Notes; or
(vii) reduce the percentage or aggregate principal amount of
outstanding Notes the consent of whose Holders is necessary for waiver of
compliance with certain provisions of this Indenture or for waiver of
certain defaults.
- 59 -
It shall not be necessary for the consent of the Holders under this Section
9.02 to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section 9.02 becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. The Company shall mail
supplemental indentures to Holders upon request. Any failure of the Company to
mail such notice, or any defect therein, shall not, however, in any way impair
or affect the validity of any such supplemental indenture or waiver.
SECTION 9.03. Revocation and Effect of Consent. Until an amendment or
waiver becomes effective, a consent to it by a Holder is a continuing consent by
the Holder and every subsequent Holder of a Note or portion of a Note that
evidences the same debt as the Note of the consenting Holder, even if notation
of the consent is not made on any Note. However, any such Holder or subsequent
Holder may revoke the consent as to its Note or portion of its Note. Such
revocation shall be effective only if the Trustee receives the notice of
revocation before the time the amendment, supplement or waiver becomes
effective. An amendment, supplement or waiver shall become effective on receipt
by the Trustee of written consents from the Holders of the requisite percentage
in principal amount of the outstanding Notes.
The Company may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver. If a record date is fixed, then, notwithstanding the last
two sentences of the immediately preceding paragraph, those persons who were
Holders at such record date (or their duly designated proxies) and only those
persons shall be entitled to consent to such amendment, supplement or waiver or
to revoke any consent previously given, whether or not such persons continue to
be Holders after such record date. No such consent shall be valid or effective
for more than 90 days after such record date.
After an amendment, supplement or waiver becomes effective, it shall bind
every Holder unless it is of the type described in any of clauses (i) through
(vii) of the second" paragraph of Section 9.02. In case of an amendment or
waiver of the type described in clauses (i) through (vii) of the second
paragraph of Section 9.02, the amendment or waiver shall bind each Holder who
has consented to it and every subsequent Holder of a Note that evidences the
same indebtedness as the Note of the consenting Holder.
SECTION 9.04. Notation on or Exchange of Notes. If an amendment, supplement
or waiver changes the terms of a Note, the Trustee may require the Holder to
deliver it to the Trustee. At the Company's expense, the Trustee may place an
appropriate notation on the Note about the changed terms and return it to the
Holder and the Trustee may place an appropriate notation on any Note thereafter
authenticated. Alternatively, if the Company or the Trustee so determines, the
Company in exchange for the Note shall issue and the Trustee shall authenticate
a new Note that reflects the
- 60 -
changed terms. Failure to make the appropriate notation, or issue a new Note,
shall not affect the validity and effect of such amendment, supplement or
waiver.
SECTION 9.05. Trustee to Sign Amendments, Etc. The Trustee shall be
entitled to receive, and shall be fully protected in relying upon, an Opinion of
Counsel stating that the execution of any amendment, supplement or waiver
authorized pursuant to this Article Nine is authorized or permitted by this
Indenture and that it shall be valid and binding upon the Company. Subject to
the preceding sentence, the Trustee shall sign such amendment, supplement or
waiver if the same does not adversely affect the rights, duties, liabilities or
immunities of the Trustee. The Trustee may, but shall not be obligated to,
execute any such amendment, supplement or waiver that affects the Trustee's own
rights, duties or immunities under this Indenture or otherwise.
SECTION 9.06. Conformity with Trust Indenture Act. Every supplemental
indenture executed pursuant to this Article Nine shall conform to the
requirements of the TIA as then in effect.
ARTICLE TEN
MISCELLANEOUS
SECTION 10.01. Trust Indenture Act of 1939. Prior to the effectiveness of
the Registration Statement, this Indenture shall incorporate and be governed by
the provisions of the TIA that are required to be part of and to govern
indentures qualified under the TIA. After the effectiveness of the Registration
Statement, this Indenture shall be subject to the provisions of the TIA that are
required to be a part of this Indenture and shall, to the extent applicable, be
governed by such provisions.
SECTION 10.02. Notices. Any notice or communication shall be sufficiently
given if in writing and delivered in person, mailed by first-class mail
or sent by telecopier transmission addressed as follows:
if to the Company:
KNOLOGY, Inc.
▇▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
if to the Trustee:
Wilmington Trust Company
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Reorg Services
- 61 -
Or
DC-1615 Reorg Services
▇▇ ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Reorg Services
The Company or the Trustee by notice to the other may designate additional
or different addresses for subsequent notices or communications.
Any notice or communication to Holders shall be: (i) mailed to each Holder
at its address as it appears on the Security Register by first-class mail, not
later than the latest date, and not earlier than the earliest date, prescribed
for giving such notice, and (ii) for as long as the Notes are listed on the
Luxembourg Stock Exchange, in Luxembourg in a newspaper having general
circulation, once in each of three successive calendar weeks, the first
publication to be not later than the latest date, and not earlier than the
earliest date, prescribed for giving such notice. Copies of any such
communication or notice to a Holder shall also be mailed to the Trustee and each
Agent at the same time.
Failure to transmit a notice or communication to a Holder as provided in
clause (i) of the preceding paragraph of any defect in any such notice shall not
affect its sufficiency with respect to other Holders. Except for a notice to the
Trustee, which is deemed given only when received, and except as otherwise
provided in this Indenture, if a notice or communication is mailed in the manner
provided in clause (i) of the preceding paragraph, it is duly given, whether or
not the addressee receives it.
Where this Indenture provides for notice in any manner, such notice may be
waived in writing by the Person entitled to receive such notice, either before
or after the event, and such waiver shall be the equivalent of such notice.
Waivers of notice by Holders shall be filed with the Trustee, but such filing
shall not be a condition precedent to the validity of any action taken in
reliance upon such waiver.
In case by reason of the suspension of regular mail service or by reason of
any other cause it shall be impracticable to give such notice by mail, then such
notification as shall be made with the approval of the Trustee shall constitute
a sufficient notification for every purpose hereunder.
SECTION 10.03. 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:
(i) an Officers' Certificate stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
- 62 -
(ii) an Opinion of Counsel stating that, in the opinion of such
Counsel, all such conditions precedent have been complied with.
SECTION 10.04. Statements Required in Certificate or Opinion. Each
certificate or opinion with respect to compliance with a condition or covenant
provided for in this Indenture shall include:
(i) a statement that each person signing such certificate or opinion
has read such covenant or condition and the definitions herein relating
thereto;
(ii) a brief statement as to the nature and scope of the examination
or investigation upon which the statement or opinion contained in such
certificate or opinion is based;
(iii) a statement that, in the opinion of each such person, he has
made such examination or investigation as is necessary to enable him to
express an informed opinion as to whether or not such covenant or condition
has been complied with; and
(iv) a statement as to whether or not, in the opinion of each such
person, such condition or covenant has been complied with; provided,
however, that, with respect to matters of fact, an Opinion of Counsel may
rely on an Officers' Certificate or certificates of public officials.
SECTION 10.05. Rules by Trustee, Paying Agent or Registrar. The Paying
Agent or Registrar may make reasonable rules for its functions.
SECTION 10.06. Payment Date Other Than a Business Day. If an Interest
Payment Date, Redemption Date, Payment Date, Stated Maturity or date of maturity
of any Note shall not be a Business Day, then payment of principal of, premium,
if any, or interest on such Note, as the case may be, need not be made on such
date, but may be made on the next succeeding Business Day with the same force
and effect as if made on the Interest Payment Date; Payment Date or Redemption
Date, or at the Stated Maturity or date of maturity of such Note; provided that
no interest shall accrue for the period from and after such Interest Payment
Date, Payment Date, Redemption Date, Stated Maturity or date of maturity, as the
case may be.
SECTION 10.07. Governing Law. The laws of the State of New York shall
govern this Indenture and the Notes. The Trustee, the Company and the Holders
agree to submit to the jurisdiction of the courts of the State of New York in
any action or proceeding arising out of or relating to this Indenture or the
Notes.
SECTION 10.08. No Adverse Interpretation of Other Agreements. This
Indenture may not be used to interpret another indenture, loan or debt agreement
of the Company or any Subsidiary of the Company. Any such indenture, loan or
debt agreement may not be used to interpret this Indenture.
- 63 -
SECTION 10.09. No Recourse Against Others. No recourse for the payment of
the principal of, premium, if any, or interest on any of the Notes or for any
claim based thereon or otherwise in respect thereof, and no recourse under or
upon any obligation, covenant or agreement of the Company in this Indenture, or
in any of the Notes or because of the creation of any Indebtedness represented
thereby, shall be had against any incorporator, stockholder, officer, director,
employee or controlling person of the Company or of any successor Person
thereof. Each Holder, by accepting the Notes, waives and releases all such
liability.
SECTION 10.10. Successors. All agreements of the Company in this Indenture
and the Notes shall bind its successors. All agreements of the Trustee in this
Indenture shall bind its successor.
SECTION 10.11. Duplicate 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 10.12. Separability. In case any provision in this Indenture or in
the Notes 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 10.13. Table of Contents. Headings, Etc. The Table of Contents,
Cross-Reference Table and headings of the Articles and Sections of this
Indenture have been inserted for convenience of reference only, are not to be
considered a part hereof and shall in no way modify or restrict any of the terms
and provisions hereof.
ARTICLE ELEVEN
MEETINGS OF HOLDERS
SECTION 11.01. Purposes for Which Meetings May Be Called.
A meeting of Holders may be called at any time and from time to time
pursuant to the provisions of this Article Eleven for any of the following
purposes:
(a) to give any notice to the Company or to the Trustee, or to give
any directions to the Trustee, or to waive or to consent to the waiving of
any Default or Event of Default hereunder and its consequences, or to take
any other action authorized to be taken by Holders pursuant to any of the
provisions of Article Six;
(b) to remove the Trustee or appoint a successor Trustee pursuant to
the provisions of Article Seven;
(c) to consent to an amendment, supplement or waiver pursuant to the
provisions of Section 9.02; or
(d) to take any other action authorized to be taken by or on behalf of
the Holders of any specified aggregate principal amount of the Notes under
any other provision of this Indenture, or authorized or permitted by law.
- 64 -
SECTION 11.02. Manner of Calling Meetings.
The Trustee may at any time call a meeting of Holders to take any action
specified in Section 11.01, to be held at such time and at such place in The
City of New York, New York or elsewhere as the Trustee will determine. Notice of
every meeting of Holders, setting forth the time and place of such meeting and
in general terms the action proposed to be taken at such meeting, will be mailed
by the Trustee, first-class postage prepaid, to the Company and to the Holders
at their last addresses as they will appear on the registration books of the
Registrar not less than 10 nor more than 60 days prior to the date fixed for a
meeting.
Any meeting of Holders will be valid without notice if the Holders of all
outstanding Notes are present in Person or by proxy, or if notice is waived
before or after the meeting by the Holders of all outstanding Notes, and if the
Company and the Trustee are either present by duly authorized representatives or
have, before or after the meeting, waived notice.
SECTION 11.03. Call of Meetings by the Company or Holders.
In case at any time the Company, pursuant to a Board Resolution, or the
Holders of not less than 10% in aggregate principal amount of the outstanding
Notes will have requested the Trustee to call a meeting of Holders to take any
action specified in Section 11.01, by written request setting forth in
reasonable detail the action proposed to be taken at the meeting, and the
Trustee will not have mailed the notice of such meeting within 20 days after
receipt of such request, then the Company or the Holders of Notes in the amount
above specified may determine the time and place in The City of New York, New
York or elsewhere for such meeting and may call such meeting for the purpose of
taking such action, by mailing or causing to be mailed notice thereof as
provided in Section 11.02, or by causing notice thereof to be published at least
once in each of two successive calendar weeks (on any Business Day during such
week) in a newspaper or newspapers printed in the English language, customarily
published at least five days a week of a general circulation in The City of New
York, State of New York and, in the event the Notes are listed on the Luxembourg
Stock Exchange, in Luxembourg, the first such publication to be not less than 10
nor more than 60 days prior to the date fixed for the meeting.
- 65 -
SECTION 11.04. Who May Attend and Vote at Meetings.
To be entitled to vote at any meeting of Holders, a Person will (i) be a
registered Holder of one or more Names or (ii) be a Person appointed by an
instrument in writing as proxy for the registered Holder or Holders of Notes.
The only Persons who will be entitled to be present or to speak at any meeting
of Holders will be the Persons entitled to vote at such meeting and their
counsel and any representatives of the Trustee and its counsel and any
representatives of the Company and its counsel.
SECTION 11.05. Quorum; Action.
The Persons entitled to vote a majority in principal amount of the
outstanding Notes shall constitute a quorum. In the absence of a quorum within
30 minutes of the time appointed for any such meeting, the meeting shall, if
convened at the request of Holders of Notes, be dissolved. In any other case the
meeting may be adjourned for a period of not less than 10 days as determined by
the chairman of the meeting prior to the adjournment of such meeting. In the
absence of a quorum at any such adjourned meeting, such adjourned meeting may be
further adjourned for a period of not less than 10 days as determined by the
chairman of the meeting prior to the adjournment of such adjourned meeting.
Notice of the reconvening of any adjourned meeting shall be given as provided in
Section 11.02, except that such notice need be given only once and not less than
five days prior to the date on which the meeting is scheduled to be reconvened.
Notice of the reconvening of an adjourned meeting shall state expressly the
percentage of the principal amount of the outstanding Notes which shall
constitute a quorum.
Subject to the foregoing, at the reconvening of any meeting adjourned for a
lack of a quorum, the Persons entitled to vote 25% in principal amount of the
outstanding Notes at the time shall constitute a quorum for the taking of any
action set forth in the notice of the original meeting.
At a meeting or an adjourned meeting duly reconvened and at which a quorum
is present as aforesaid, any action or matter, except as otherwise specified
herein, shall be effectively passed and decided if passed or decided by the
Persons entitled to vote not less than a majority in principal amount of
outstanding Notes represented and voting at such meeting.
Any action or matter passed or decision taken at any meeting of Holders of
Notes duly held in accordance with this Section 11.05 shall be binding on all
the Holders of Notes, whether or not present or represented at the meeting.
SECTION 11.06. Regulations May Be Made by Trustee, Conduct of the Meeting
Voting Rights, Adjournment.
Notwithstanding any other provision of this Indenture, the Trustee may make
such reasonable regulations as it may deem advisable for any action by or any
meeting of Holders, in regard to proof of the holding of Notes and of the
appointment of proxies, and in regard to the appointment and duties of
inspectors of votes, and submission and examination of proxies, certificates and
other evidence of the right to vote, and such other
- 66 -
matters concerning the conduct of the meeting as it will think appropriate. Such
regulations may fix a record date and time for determining the Holders of record
of Notes entitled to vote at such meeting, in which case those and only those
Persons who are Holders of Notes at the record date and time so fixed, or their
proxies, will be entitled to vote at such meeting whether or not they will be
such Holders at the time of the meeting.
The Trustee shall, by an instrument in writing, appoint a temporary
chairman of the meeting, unless the meeting will have been called by the Company
or by Holders as provided in Section 11.03, in which case the Company or the
Holders calling the meeting, as the case may be, will in like manner appoint a
temporary chairman. A permanent chairman and a permanent secretary of the
meeting shall be elected by vote of the Holders of a majority in principal
amount of the Notes represented at the meeting and entitled to vote.
At any meeting each Holder or proxy shall, subject to the provisions of
Section 11.04 hereof, be entitled to one vote for each $1,000 principal amount
of Notes held or represented by such Holder; provided, however, that no vote
will be cast or counted at any meeting in respect of any Notes challenged as not
outstanding and ruled by the chairman of the meeting to be not outstanding. The
chairman may adjourn any such meeting if he is unable to determine whether any
Holder or proxy will be entitled to vote at such meeting. The chairman of the
meeting will have no right to vote other than by virtue of Notes held by him or
instruments in writing as aforesaid duly designating him as the proxy to vote on
behalf of other Holders. Any meeting of Holders duly called pursuant to the
provisions of Section 11.02 or Section 11.03 may be adjourned from time to time
by vote of the Holders of a majority in aggregate principal amount of the Notes
represented at the meeting and entitled to vote, and the meeting may be held as
so adjourned without further notice.
SECTION 11.07. Voting at the Meeting and Record to Be Kept.
The vote upon any resolution submitted to any meeting of Holders shall be
by written ballots on which will be subscribed the signatures of the Holders of
Notes or of their representatives by proxy and the principal amount of the Notes
voted by the ballot. The permanent chairman of the meeting shall appoint two
inspectors of votes, who shall count all votes cast at the meeting for or
against any resolution and shall make and file with the secretary of the meeting
their verified written reports in duplicate of all votes cast at the meeting. A
record in duplicate of the proceedings of each meeting of Holders shall be
prepared by the secretary of the meeting and there shall be attached to such
record the original reports of the inspectors of votes on any vote by ballot
taken thereat and affidavits by one or more Persons having knowledge of the
facts, setting forth a copy of the notice of the meeting and showing that such
notice was mailed as provided in Section 11.02. The record shall be signed and
verified by the affidavits of the permanent chairman and the secretary of the
meeting and one of the duplicates will be delivered to the Company and the other
to the Trustee to be preserved by the Trustee, the latter to have attached
thereto the ballots voted at the meeting.
- 67 -
Any record so signed and verified shall be conclusive evidence of the
matters therein stated.
SECTION 11.08. Exercise of Rights of Trustee or Holders May Not Be Hindered
or Delayed by Call of Meeting.
Nothing contained in this Article Eleven shall be deemed or construed to
authorize or permit, by reason of any call of a meeting of Holders or any rights
expressly or impliedly conferred hereunder to make such call, any hindrance or
delay in the exercise of any right or rights conferred upon or reserved to the
Trustee or to the Holders under any of the provisions of this Indenture or of
the Notes.
SECTION 11.09. Procedures Not Exclusive.
The procedures set-forth in this Article Eleven are not exclusive and the
rights and obligations of the Company, the Trustee and the Holders under other
Articles of this Indenture (including, without limitation, Articles Six, Seven,
Eight and Nine) shall in no way be limited by the provisions of this Article
Eleven.
[Signatures on Next Page]
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[Signature Page to Knology, Inc. 12% Senior Notes Indenture]
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of the date first written above.
KNOLOGY, INC.
By: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Chief Financial Officer
WILMINGTON TRUST COMPANY, as Trustee
By: /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇
---------------------------------
Name: ▇▇▇▇▇▇ ▇. ▇▇▇▇
Title: Senior Financial Services Officer
- 69 -
EXHIBIT A
[FACE OF NOTE]
THIS NOTE HAS BEEN ISSUED PURSUANT TO (A) A JOINT PLAN OF REORGANIZATION (THE
"JOINT PLAN") JOINTLY PROPOSED BY KNOLOGY, INC. AND KNOLOGY BROADBAND, INC. IN
CHAPTER 11 CASE NO. 02-11514 FILED WITH THE UNITED STATES BANKRUPTCY COURT FOR
THE NORTHERN DISTRICT OF GEORGIA AND (B) SECTION 1145(a) OF TITLE 11 OF THE
UNITED STATES CODE, 11 U.S.C. (S)(S) 101 et. seq. (AS AMENDED, THE "BANKRUPTCY
CODE"). THE JOINT PLAN HAS BEEN CONFIRMED BY THE BANKRUPTCY COURT AND THIS NOTE
AND ANY INTEREST THEREIN IS EXEMPT FROM REGISTRATION UNDER THE SECURITIES ACT OF
1933, AS AMENDED, AND ANY STATE AND LOCAL SECURITIES LAWS AND IS FREELY
TRANSFERABLE PURSUANT TO SECTION 1145(a) OF THE BANKRUPTCY CODE.
[If a Global Note, then the following legend shall be included.]
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF
TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE
NAME OF CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY (AND ANY PAYMENT HEREON IS MADE
TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY), ANY TRANSFER, PLEDGE OR OTHER
USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL SINCE THE
REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE.
----------
Note: The Table of Contents shall not for any purposes be deemed to be a part of
the Indenture.
KNOLOGY, INC.
12% Senior Note due 2009
[CUSIP] [CINS] [_________________]
No. [R - _____] Issue Date: , 2002
-----------
$
------------------
[If a PIK Note, this Note shall have the same terms and conditions as the Notes
and shall be entitled to all of the benefits of the Indenture as if this PIK
Note was a Note.]
KNOLOGY, INC., a Delaware corporation (the "Company", which term includes
any successor under the Indenture hereinafter referred to), for value received,
promises to pay to , or its registered assigns, the principal
-----------------
sum of ($________________) on
------------------------------------------------
November 30, 2009.
Interest Payment Dates: May 31 and November 30, commencing May 31, 2003.
Regular Record Dates: May 15 and November 15
Reference is hereby made to the further provisions of this Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.
IN WITNESS WHEREOF, the Company has caused this Note to be signed manually
or by facsimile by its duly authorized officers.
Date: KNOLOGY, INC.
By:
---------------------------------------
Name:
--------------------------------
Title:
--------------------------------
By:
---------------------------------------
Name:
--------------------------------
Title:
--------------------------------
(Trustee's Certificate of Authentication)
A-1
This is one of the 12% Senior Notes due 2009 described in the within-mentioned
Indenture.
WILMINGTON TRUST COMPANY,
as Trustee
By:
----------------------------------------
Authorized Signatory
A-2
[REVERSE SIDE OF NOTE]
KNOLOGY, INC.
12% Senior Note due 2009
1. Principal and Interest.
The Company shall pay the principal of this Note on November 30, 2009.
The Company promises to pay interest on the principal amount of this Note
on each Interest Payment Date, and at the rate per annum as set forth below.
Interest shall be payable semi-annually (to the holders of record of the
Notes at the close of business on May 15 or November 15 immediately preceding
the Interest Payment Date) on each Interest Payment Date commencing May 31,
2003.
During the PIK Period, unless the Company notifies the Trustee prior to the
record date for the applicable Interest Payment Date that the Company elects to
pay interest in cash, the Company shall automatically pay interest through the
issuance of a PIK Note in a principal amount equal to the amount of accrued but
unpaid interest then due. If, during the PIK Period, the Company pays accrued
interest through the issuance of a PIK Note, the amount of interest then due and
owing on the applicable Interest Payment Date during the PIK Period and,
therefore, the principal amount of the PIK Note to be issued, shall be
calculated at the rate of 13% per annum. If, during the PIK Period, the Company
elects to pay accrued but unpaid interest in cash, the amount of interest then
due and owing on the applicable Interest Payment Date shall be calculated at the
rate of 11% per annum. At all times after the PIK Period, the Company shall pay
interest on the Notes in cash at the rate of 12% per annum until November 30,
2009. Each PIK Note shall bear interest at the same rate, and such interest
shall be payable in cash or through the issuance of a PIK Note in the same
manner as a Note. Each PIK Note issued hereunder shall be entitled to all of the
benefits and protections of this Indenture and, unless otherwise expressly set
forth herein, each reference to a Note hereunder shall be deemed to be a
reference to each PIK Note issued hereunder. To the extent interest is paid
through the issuance of a PIK Note, a PIK Note shall be issued to each Holder of
record of Notes at the close of business on May 15 or November 15 immediately
preceding the applicable Interest Payment Date in the same form for delivery in
the same manner as the Note(s) held by such Holder in a principal amount equal
to the accrued interest then due such Holder in accordance herewith. Each PIK
Note shall be duly executed by the Company and authenticated by the Trustee in
accordance with the procedures set forth for Notes in Article Two of the
Indenture.
From and after the Closing Date, interest on the Notes shall accrue from
the most recent date to which interest has been paid or, if no interest has been
paid, from the Closing Date; provided that, if there is no existing default in
the payment of interest and this Note is authenticated between a Regular Record
Date referred to on the face hereof
A-3
and the next succeeding Interest Payment Date, interest shall accrue from such
Interest Payment Date. Interest shall be computed on the basis of a 360-day year
of twelve 30-day months.
The Company shall pay interest on overdue principal and premium, if any,
and interest on overdue installments of interest, to the extent lawful, at a
rate per annum that is 2% in excess of the rate otherwise payable.
2. Method of Payment.
The Company shall pay interest (except defaulted interest) on the principal
amount of the Notes as provided above on each May 31 and November 30 commencing
on May 31, 2003, to the persons who are Holders (as reflected in the Security
Register at the close of business on the May 15 or November 15 immediately
preceding the Interest Payment Date), in each case, even if the Note is
cancelled on registration of transfer or registration of exchange after such
Regular Record Date; provided that, with respect to the payment of principal,
the Company shall make payment to the Holder that surrenders this Note to a
Paying Agent on or after November 30, 2009.
The Company shall pay principal, premium, if any, and as provided above,
interest either through the issuance of a PIK Note or in money of the United
States that at the time of payment is legal tender for payment of public and
private debts. If a payment date is a date other than a Business Day at a place
of payment, payment may be made at that place on the next succeeding day that is
a Business Day and no interest shall accrue for the intervening period.
3. Paying Agent and Registrar.
Initially, the Trustee shall act as authenticating agent, Paying Agent and
Registrar. The Company may change any authenticating agent, Paying Agent or
Registrar without notice. The Company, any Subsidiary or any Affiliate of any of
them may act as Paying Agent, Registrar or co-Registrar.
4. Indenture, Limitations.
The Company issued the Notes under an Indenture dated as of November 6,
2002 (the "Indenture"), between the Company and Wilmington Trust Company,
trustee (the "Trustee"). Capitalized terms herein are used as defined in the
Indenture unless otherwise indicated. The terms of the Notes include those
stated in the Indenture and those made part of the Indenture by reference to the
Trust Indenture Act. The Notes are subject to all such terms, and Holders are
referred to the Indenture and the Trust Indenture Act for a statement of all
such terms. To the extent permitted by applicable law, in the event of any
inconsistency between the terms of this Note and the terms of the Indenture, the
terms of the Indenture shall control.
The Notes are general obligations of the Company.
5. Optional Redemption.
A-4
The Notes shall be redeemable, at the Company's option, in whole or in
part, at any time or from time to time, on or after November 6, 2002 and prior
to maturity, upon not less than 30 nor more than 60 days' prior notice mailed by
first class mail to each Holder's last address, as it appears in the Security
Register. The Redemption Price for the Notes, expressed in percentages of
principal amount, plus accrued and unpaid interest (if any) to the Redemption
Date shall equal: (i) 102%, if redeemed prior to November 6, 2003; (ii) 101%, if
redeemed after November 6, 2003 but prior to November 6, 2004 and (iii) 100%, if
redeemed on or after November 6, 2004. Notes in original denominations larger
than $1,000 in principal amount may be redeemed in part. On and after the
Redemption Date, interest ceases to accrue on Notes or portions of Notes called
for redemption, unless the Company defaults in the payment of the Redemption
Price.
6. Repurchase upon Change of Control.
Upon the occurrence of any Change of Control, each Holder shall have the
right to require the repurchase of its Notes by the Company in cash pursuant to
the offer described in the Indenture at a purchase price equal to 101% (or, if
such Change of Control occurs after November 6, 2004, 100%) of the principal
amount thereof plus accrued and unpaid interest (if any) to the date of purchase
(the "Payment Date").
A notice of such Change of Control shall be mailed within 30 days after any
Change of Control occurs to each Holder at its last address as it appears in the
Security Register. Notes in original denominations larger than $1,000 in
principal amount may be sold to the Company in part. On and after the Payment
Date, interest ceases to accrue on Notes or portions of Notes surrendered for
purchase by the Company, unless the Company defaults in the payment of the
purchase price.
7. Denominations, Transfer: Exchange.
The Notes are in registered form without coupons in denominations of $1,000
of principal amount and multiples of $1,000 in excess thereof (except for
initial Notes issued to HLHZ and any PIK Notes). A Holder may register the
transfer or exchange of Notes in accordance with the Indenture. The Registrar
may require a Holder, among other things, to furnish appropriate endorsements
and transfer documents and to pay any taxes and fees required by law or
permitted by the Indenture. The Registrar need not register the transfer or
exchange of any Notes selected for redemption. Also, it need not register the
transfer or exchange of any Notes for a period of 15 days before the day of
mailing of a notice of redemption of Notes selected for redemption.
8. Persons Deemed Owners.
A Holder shall be treated as the owner of a Note for all purposes.
9. Unclaimed Money.
If money for the payment of principal, premium, if any, or interest remains
unclaimed for two years, the Trustee and the Paying Agent shall pay the money
back to the Company at its request. After that, Holders entitled to the money
must look to the
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Company for payment, unless an abandoned property law designates another Person,
and all liability of the Trustee and such Paying Agent with respect to such
money shall cease.
10. Discharge Prior to Redemption or Maturity.
If the Company deposits with the Trustee money or U.S. Government
Obligations sufficient to pay the then outstanding principal of, premium, if
any, and accrued interest on the Notes (a) to redemption or maturity, the
Company shall be discharged from the Indenture and the Notes, except in certain
circumstances for certain sections thereof, and (b) to the Stated Maturity, the
Company shall be discharged from certain covenants set forth in the Indenture.
11. Amendment: Supplement: Waiver.
Subject to certain exceptions specified in the Indenture, the Indenture or
the Notes may be amended or supplemented with the consent of the Holders of at
least a majority in principal amount of the Notes then outstanding, and any
existing default or compliance with any provision may be waived with the consent
of the Holders of at least a majority in principal amount of the Notes then
outstanding. Without notice to or the consent of any Holder, the parties thereto
may amend or supplement the Indenture or the Notes to, among other things, cure
any ambiguity, defect or inconsistency and make any change that does not
materially and adversely affect the rights of any Holder.
12. Restrictive Covenants.
The Indenture imposes certain limitations on the ability of the Company and
its Subsidiaries, among other things, to Incur additional Indebtedness, make
Restricted Payments, use the proceeds from Asset Sales, engage in transactions
with Affiliates or merge, consolidate or transfer substantially all of its
assets. Within 45 days after the end of each fiscal quarter (90 days after the
end of the last fiscal quarter of each year), the Company must report to the
Trustee on compliance with such limitations.
13. Successor Persons.
When a successor Person or other entity assumes all the obligations of its
predecessor under the Notes and the Indenture, the predecessor person shall be
released from those obligations.
14. Defaults and Remedies.
The following events constitute "Events of Default" under the Indenture:
(a) default in the payment of principal of (or premium, if any, on) any Note
when the same becomes due and payable upon acceleration, redemption or
otherwise; (b) default in the payment of interest on any Note when the same
becomes due and payable, which default continues for a period of 30 days; (c)
default in the performance of or breach of Section 5.01 of the Indenture or the
failure to make or consummate an Offer to Purchase in accordance with Sections
4.10, 4.11, 4.20 or 4.21 of the Indenture; (d) default in the performance of or
breach of any covenant or agreement of the Company in the Indenture
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or under the Notes (other than a default specified in clause (a), (b) or (c)
above), which default or breach continues for a period of 30 consecutive days
after written notice by the Trustee or the Holders of at least 25% in aggregate
principal amount of the Notes then outstanding; (e) there occurs with respect to
any issue or issues of Indebtedness of the Company or any Significant Subsidiary
having an outstanding principal amount of $5.0 million or more in the aggregate
for all such issues of all such Persons, whether such Indebtedness now exists or
shall hereafter be created, (I) an event of default that has caused the holder
thereof to declare such Indebtedness to be due and payable prior to its Stated
Maturity and such Indebtedness has not been discharged in full or such
acceleration has not been rescinded or annulled within 30 days of such
acceleration and/or (II) the failure to make a principal payment when due and
such defaulted payment shall not have been made, waived or extended within 30
days of such payment default; (f) any final judgment or order (not covered by
insurance) for the payment of money in excess of $5.0 million in the aggregate
for all such final judgments or orders against all such Persons (treating any
deductibles, self-insurance or retention as not so covered) shall be rendered
against the Company or any Significant Subsidiary and shall not be paid or
discharged, and there shall be any period of 30 consecutive days following entry
of the final judgment or order that causes the aggregate amount for all such
final judgments or orders outstanding and not paid or discharged against all
such Persons to exceed $5.0 million during which a stay of enforcement of such
final judgment or order, by reason of a pending appeal or otherwise, shall not
be in effect; (g) a court having jurisdiction in the premises enters a decree or
order for (I) relief in respect of the company or any Significant Subsidiary in
an involuntary case under any applicable bankruptcy, insolvency or other similar
law now or hereafter in effect, (II) appointment of a receiver, liquidator,
assignee, custodian, trustee, sequestrator or similar official of the Company or
any Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (III) the winding up or
liquidation of the affairs of the Company or any Significant Subsidiary and, in
each case, such decree or order shall remain unstayed and in effect for a period
of 60 consecutive days; or (h) the Company or any Significant Subsidiary (I)
commences a voluntary case under any applicable bankruptcy, insolvency or other
similar law now or hereafter in effect, or consents to the entry of an order for
relief in an involuntary case under any such law, (II) consents to the
appointment of or taking possession by a receiver, liquidator, assignee,
custodian, trustee, sequestrator or similar official of the Company or any
Significant Subsidiary or for all or substantially all of the property and
assets of the Company or any Significant Subsidiary or (III) effects any general
assignment for the benefit of creditors.
If an Event of Default (as defined in the Indenture), other than an Event
of Default specified in clause (g) or (h) above that occurs with respect to the
Company) occurs and is continuing, the Trustee may, and at the direction. of the
Holders of at least 25% in aggregate principal amount of the Notes then
outstanding shall declare all the Notes to be due and payable. If a bankruptcy
or insolvency default with respect to the Company specified in clause (g) or (h)
above occurs and is continuing, the Notes automatically become due and payable.
Holders may not enforce the Indenture or the Notes except as provided in the
Indenture. The Trustee may require indemnity satisfactory to it before it
enforces the Indenture or the Notes. Subject to certain limitations, Holders of
at least a
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majority in principal amount of the Notes then outstanding may direct the
Trustee in its exercise of any trust or power.
15. Trustee Dealings with Company.
The Trustee under the Indenture, 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.
16. No Recourse Against Others.
No incorporator or any past, present or future partner, stockholder, other
equity holder, officer, director, employee or controlling person as such, of the
Company or of any successor Person shall have any liability for any obligations
of the Company under the 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 Note waives and releases all such liability. The waiver and release
are part of the consideration for the issuance of the Notes.
17. Authentication.
This Note shall not be valid until the Trustee or authenticating agent
signs the certificate of authentication on the other side of this Note.
18. 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).
The Company shall furnish a copy of the Indenture to any Holder upon
written request and without charge. Requests may be made to KNOLOGY, Inc., ▇▇▇
▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇; Attention: Chief Financial Officer.
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[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
--------------------------------------------------------------------------------
Please print or typewrite name and address including zip code of assignee
--------------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing attorney to
-------------------------------------------------------
transfer said Note on the books of the Company with full power of substitution
in the premises.
Date:
--------------------------- -------------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within-mentioned
instrument in every particular, without
alteration or any change whatsoever.
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OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to Section
4.10 or 4.11 of the Indenture, check the Box:[ ]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 4.10 or 4.11 of the Indenture, state the principal amount:
$
--------------------------------
Date:
----------------------------
Your Signature:
----------------------------------------------------------------
(Sign exactly as your name appears
on the other side of this Note)
Signature Guarantee:
-----------------------------------------------------------
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