DRAFT - 6/21/04
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NATIONAL ENERGY & GAS TRANSMISSION, INC.
$500,000,000
SECURED TRANCHE B TERM NOTES DUE 2011
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INDENTURE
Dated as of June __, 2004
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WILMINGTON TRUST COMPANY,
TRUSTEE
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CROSS-REFERENCE TABLE*
Trust Indenture Indenture Section
Act Section
310 (a)(1).................................................. 7.10
(a)(2).................................................. 7.10
(a)(3).................................................. N.A.
(a)(4).................................................. N.A.
(a)(5).................................................. 7.10
(b)..................................................... 7.10
(c)..................................................... N.A.
311 (a)..................................................... 7.11
(b)..................................................... 7.11
(c)..................................................... N.A.
312 (a)..................................................... 2.05
(b)..................................................... 11.03
(c)..................................................... 11.03
313 (a)..................................................... 7.06
(b)(1).................................................. N.A.
(b)(2).................................................. 7.06; 7.07
(c)..................................................... 7.06; 11.02
(d)..................................................... 7.06
314 (a)..................................................... 4.03; 11.05
(b)..................................................... 10.02
(c)(1).................................................. 11.04
(c)(2).................................................. 11.04
(c)(3).................................................. N.A.
(d)..................................................... 10.05
(e)..................................................... 11.05
(f)..................................................... N.A.
315 (a)..................................................... 7.01
(b)..................................................... 7.05; 11.02
(c)..................................................... 7.01
(d)..................................................... 7.01
(e)..................................................... 6.11
316 (a)(last sentence)...................................... 2.09
(a)(1)(A)............................................... 6.05
(a)(1)(B)............................................... 6.04
(a)(2).................................................. N.A.
(b)..................................................... 6.07
(c)..................................................... 9.04
317 (a)(1).................................................. 6.08
(a)(2).................................................. 6.09
(b)..................................................... 2.04
318 (a)..................................................... 11.01
(b)..................................................... N.A.
(c)..................................................... 11.01
N.A. means not applicable.
* This Cross-Reference Table is not part of the Indenture.
TABLE OF CONTENTS
Page
ARTICLE 1. DEFINITIONS AND INCORPORATION BY REFERENCE.....................................................1
Section 1.01. Definitions.......................................................................1
Section 1.02. Other Definitions................................................................17
Section 1.03. Incorporation by Reference of Trust Indenture Act................................17
Section 1.04. Rules of Construction............................................................17
ARTICLE 2. THE NOTES.....................................................................................18
Section 2.01. Form and Dating..................................................................18
Section 2.02. Execution and Authentication; Payment of Interest by Issuance of
Additional Notes.................................................................20
Section 2.03. Registrar and Paying Agent.......................................................21
Section 2.04. Paying Agent to Hold Money in Trust..............................................21
Section 2.05. Holder Lists.....................................................................22
Section 2.06. Transfer and Exchange............................................................22
Section 2.07. Replacement Notes................................................................24
Section 2.08. Outstanding Notes................................................................24
Section 2.09. Treasury Notes...................................................................25
Section 2.10. Temporary Notes..................................................................25
Section 2.11. Cancellation.....................................................................25
Section 2.12. Defaulted Interest...............................................................26
Section 2.13. Cusip Numbers....................................................................26
ARTICLE 3. REDEMPTION....................................................................................26
Section 3.01. Notices to Trustee...............................................................26
Section 3.02. Selection of Notes to Be Redeemed................................................26
Section 3.03. Notice of Redemption.............................................................27
Section 3.04. Effect of Notice of Redemption...................................................28
Section 3.05. Deposit of Redemption Price......................................................28
Section 3.06. Notes Redeemed in Part...........................................................28
Section 3.07. Optional Redemption..............................................................28
Section 3.08. Mandatory Redemption Out of Excess Cash Flow.....................................29
Section 3.09. Mandatory Redemption Out of Net Proceeds of Principal Asset Sales................29
Section 3.10. Offer to Purchase Notes..........................................................30
ARTICLE 4. COVENANTS.....................................................................................32
Section 4.01. Payment of Notes.................................................................32
Section 4.02. Maintenance of Office or Agency..................................................32
Section 4.03. Reports..........................................................................33
Section 4.04. Compliance Certificate...........................................................33
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TABLE OF CONTENTS
(CONTINUED)
Page
Section 4.05. Taxes............................................................................34
Section 4.06. Stay, Extension and Usury Laws...................................................34
Section 4.07. Dividends; Restricted Investments................................................34
Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries...................36
Section 4.09. Incurrence of Indebtedness.......................................................36
Section 4.10. Asset Sales......................................................................39
Section 4.11. Transactions with Affiliates.....................................................40
Section 4.12. Liens............................................................................41
Section 4.13. Line of Business.................................................................41
Section 4.14. Corporate Existence..............................................................41
Section 4.15. Offer to Purchase upon a Change of Control.......................................41
Section 4.16. Limitation on Issuances and Sales of Capital Stock of Restricted
Subsidiaries.....................................................................42
Section 4.17. Payments for Consent.............................................................42
ARTICLE 5. SUCCESSORS....................................................................................43
Section 5.01. ▇▇▇▇▇▇, Consolidation or Sale of Assets..........................................43
Section 5.02. Successor Corporation Substituted................................................43
Section 5.03. Exclusion........................................................................44
ARTICLE 6. DEFAULTS AND REMEDIES.........................................................................44
Section 6.01. Events of Default................................................................44
Section 6.02. Acceleration.....................................................................46
Section 6.03. Other Remedies...................................................................46
Section 6.04. Waiver of Past Defaults..........................................................46
Section 6.05. Control by Majority..............................................................47
Section 6.06. Limitation on Suits..............................................................47
Section 6.07. Rights of Holders of Notes to Receive Payment....................................47
Section 6.08. Collection Suit by Trustee.......................................................47
Section 6.09. Trustee May File Proofs of Claim.................................................48
Section 6.10. Priorities.......................................................................48
Section 6.11. Undertaking for Costs............................................................49
ARTICLE 7. TRUSTEE.......................................................................................49
Section 7.01. Duties of Trustee................................................................49
Section 7.02. Rights of Trustee................................................................50
Section 7.03. Individual Rights of Trustee.....................................................51
Section 7.04. Trustee's Disclaimer.............................................................51
Section 7.05. Notice of Defaults...............................................................51
Section 7.06. Reports by Trustee to Holders of the Notes.......................................52
Section 7.07. Compensation and Indemnity.......................................................52
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TABLE OF CONTENTS
(CONTINUED)
Page
Section 7.08. Replacement of Trustee...........................................................53
Section 7.09. Successor Trustee by ▇▇▇▇▇▇, Etc.................................................54
Section 7.10. Eligibility; Disqualification....................................................54
Section 7.11. Preferential Collection of Claims Against Issuer.................................54
ARTICLE 8. DISCHARGE OF INDENTURE; LEGAL DEFEASANCE AND COVENANT DEFEASANCE.............................54
Section 8.01. Satisfaction and Discharge of Indenture..........................................54
Section 8.02. Option to Effect Legal Defeasance or Covenant Defeasance.........................55
Section 8.03. Legal Defeasance and Discharge...................................................55
Section 8.04. Covenant Defeasance..............................................................55
Section 8.05. Conditions to Legal or Covenant Defeasance.......................................56
Section 8.06. Deposited Money and Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions...................................................57
Section 8.07. Repayment to Issuer..............................................................58
Section 8.08. Reinstatement....................................................................58
ARTICLE 9. AMENDMENT, SUPPLEMENT AND WAIVER..............................................................58
Section 9.01. Without Consent of Holders of Notes..............................................58
Section 9.02. With Consent of Holders of Notes.................................................59
Section 9.03. Compliance with Trust Indenture Act..............................................60
Section 9.04. Revocation and Effect of Consents................................................60
Section 9.05. Notation on or Exchange of Notes.................................................61
Section 9.06. Trustee to Sign Amendments, Etc..................................................61
ARTICLE 10. SECURITY......................................................................................61
Section 10.01. Pledge and Intercreditor Agreements..............................................61
Section 10.02. Recording and Opinions...........................................................62
Section 10.03. Actions to Protect Collateral....................................................63
Section 10.04. Receipt of Funds Under Security Documents........................................63
Section 10.05. Release of Collateral............................................................63
Section 10.06. Intercreditor Agreement..........................................................64
ARTICLE 11. MISCELLANEOUS.................................................................................64
Section 11.01. Trust Indenture Act Controls.....................................................64
Section 11.02. Notices..........................................................................64
Section 11.03. Communication by Holders of Notes with Other Holders of Notes....................65
Section 11.04. Certificate and Opinion as to Conditions Precedent...............................65
Section 11.05. Statements Required in Certificate or Opinion....................................66
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TABLE OF CONTENTS
(CONTINUED)
Page
Section 11.06. Rules by Trustee and Agents......................................................66
Section 11.07. No Personal Liability of Directors, Officers, etc................................66
Section 11.08. Governing Law....................................................................66
Section 11.09. No Adverse Interpretation of Other Agreements....................................66
Section 11.10. Successors.......................................................................67
Section 11.11. Severability.....................................................................67
Section 11.12. Counterpart Originals............................................................67
Section 11.13. Table of Contents, ▇▇▇▇▇▇▇▇, Etc.................................................67
SCHEDULES
Schedule A Unrestricted Subsidiaries
EXHIBITS
Exhibit A Form of Note
Exhibit B Form of Pledge Agreement
Exhibit C Form of Collateral Agency and Intercreditor Agreement
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INDENTURE dated as of June __, 2004 between National Energy & Gas
Transmission, Inc., a Delaware corporation (the "Issuer"), and Wilmington Trust
Company, a Delaware banking corporation (the "Trustee").
RECITALS
WHEREAS, on July 8, 2003, the Issuer (then known as "PG&E National Energy
Group, Inc.") and certain of the Issuer's subsidiaries (collectively the
"Debtors") filed with the Bankruptcy Court (such term and other capitalized
terms used in these recitals without definition having the meanings ascribed to
them in Article I of this Indenture) voluntary petitions for relief under the
Bankruptcy Code, such proceedings (the "Chapter 11 Cases") being jointly
administered under Case No. 03-30459 (PM); and
WHEREAS, the Bankruptcy Court has confirmed the Modified Third Amended Plan
of Reorganization, dated April 28, 2004, of the Issuer, which provides, inter
alia, for the holders of certain claims to receive, in partial satisfaction of
their claims, Tranche A and Tranche B Notes of the Issuer, all as set forth in
the Plan of Reorganization and the Disclosure Statement related thereto; and
WHEREAS, the Plan of Reorganization contemplates that such Tranche B Notes
will be issued pursuant to and governed by an indenture and related
documentation;
NOW, THEREFORE, in consideration of the premises and of the agreements,
provisions and covenants herein contained, the Issuer and the Trustee agree as
follows for the benefit of each other and for the equal and ratable benefit of
the Holders of the Secured Tranche B Term Notes due 2011 to be issued hereunder
pursuant to the Plan of Reorganization (the "Notes"):
ARTICLE 1.
DEFINITIONS AND INCORPORATION
BY REFERENCE
Section 1.01. Definitions.
"Affiliate" of any specified Person means any other Person directly or
indirectly controlling or controlled by or under direct or indirect common
control with such specified Person. For purposes of this definition, "control"
(including, with correlative meanings, the terms "controlling," "controlled by"
and "under common control with"), as used with respect to any Person, shall mean
the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of such Person, whether through the
ownership of voting securities, by agreement or otherwise.
"Agent" means any Registrar, Paying Agent or co-registrar.
"Applicable Procedures" means, with respect to any transfer or exchange of
or for beneficial interests in any Global Note, the rules and procedures of the
Depository that apply to such transfer or exchange.
"Asset Sale" means (i) the sale, lease, conveyance or other disposition of
any assets (excluding any Sale/Leaseback Transaction, the granting of a
Permitted Lien and the transfer or disposition of cash and Cash Equivalents)
other than sales in the ordinary course of business, sales, transfers or other
dispositions in the ordinary course of business of worn out, obsolete or surplus
equipment, licensing of intellectual property in the ordinary course of business
and leasing of premises and related assets in the ordinary course of business
(provided, however, that the sale, lease, conveyance or other disposition of all
or substantially all of the assets of the Issuer and its Restricted Subsidiaries
taken as a whole will be governed by Section 4.15 and/or Article 5 hereof to the
extent, if any, provided therein, and not by Section 4.10 hereof) and (ii) the
sale by the Issuer or any of its Restricted Subsidiaries of Equity Interests in
any Restricted Subsidiary of the Issuer, in the case of either clause (i) or
(ii), whether in a single transaction or a series of related transactions, for
Net Proceeds in excess of $500,000. Notwithstanding anything in this Indenture
to the contrary, none of the following shall be deemed to be an Asset Sale: (i)
a transfer of assets or Equity Interests by the Issuer to a Restricted
Subsidiary or by a Restricted Subsidiary to the Issuer or to another Restricted
Subsidiary; (ii) an issuance of Equity Interests by a Restricted Subsidiary to
the Issuer or to another Restricted Subsidiary; (iii) Swaps; (iv) Restricted
Investments that are permitted by Section 4.07 hereof; (v) any sale of an Equity
Interest in, or Indebtedness or other securities of, an Unrestricted Subsidiary;
(vi) foreclosures on assets or Equity Interests; and (vii) sales, assignments,
transfers or other dispositions of accounts in the ordinary course of business
for purposes of collection.
"Bankruptcy Code" means Title 11, U.S. Code.
"Bankruptcy Court" means the United States Bankruptcy Court for the
District of Maryland, Greenbelt Division, in which the Debtors' Chapter 11 Cases
were jointly administered.
"Bankruptcy Law" means the Bankruptcy Code or any similar federal or state
law for the relief of debtors, as amended from time to time.
"Beneficial Owner" means "beneficial owner" as such term is defined in Rule
13d-3 and Rule 13d-5 under the Exchange Act; provided, however, that a Person
shall not be deemed to have beneficial ownership of securities subject to a
stock purchase agreement, merger agreement, or similar agreement until the
consummation of the transactions contemplated by such agreement.
"Board of Directors" means the Board of Directors of the Issuer or any
authorized committee of the Board of Directors.
"Board Resolution" means a resolution of the Board of Directors.
"Business Day" means any day except a Saturday, Sunday or other day in The
City of New York, or in the city of the principal corporate trust office of the
Trustee, on which banks are authorized to close.
"Capital Stock" means (i) in the case of a corporation, corporate stock,
(ii) in the case of an association or business entity, any and all shares,
interests, participations, rights or other
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equivalents (however designated) of corporate stock, (iii) in the case of a
partnership or limited liability company, partnership or membership interests
(whether general or limited) and (iv) any other interest or participation that
confers on a Person the right to receive a share of the profits and losses of,
or distributions of assets of, the issuing Person.
"Cash" means cash and cash equivalents, including but not limited to bank
deposits, checks and other similar items.
"Cash Equivalents" means (i) United States dollars, (ii) securities issued
or directly and fully guaranteed or insured by the United States of America or
any agency or instrumentality thereof (provided that the full faith and credit
of the United States of America is pledged in support thereof), (iii) time
deposits and certificates of deposit, including eurodollar time deposits, of any
commercial bank organized in the United States having capital and surplus in
excess of $100,000,000, in each case with a maturity date not more than one year
from the date of acquisition, (iv) repurchase obligations with a term of not
more than seven days for underlying securities of the types described in clauses
(i) and (ii) above entered into with any bank meeting the qualifications
specified in clause (iii) above and organized in the United States, (v) direct
obligations issued by any state of the United States of America or any political
subdivision of any state or any public instrumentality thereof maturing within
90 days after the date of acquisition thereof and, at the time of acquisition,
having one of the two highest ratings obtainable from either Standard & Poor's
Ratings Services or ▇▇▇▇▇'▇ Investors Service, Inc. (or, if at any time neither
Standard & Poor's Ratings Services nor ▇▇▇▇▇'▇ Investors Service, Inc. shall be
rating such obligations, then from such other nationally recognized rating
service as shall be designated by the Issuer), (vi) commercial paper issued by
the parent corporation of any commercial bank organized in the United States
having capital and surplus in excess of $100,000,000, and commercial paper
issued by others having one of the two highest ratings obtainable from either
Standard & Poor's Ratings Services or ▇▇▇▇▇'▇ Investors Service, Inc. (or, if at
any time neither Standard & Poor's Ratings Services nor ▇▇▇▇▇'▇ Investors
Service, Inc. shall be rating such obligations, then from such other nationally
recognized rating service as shall be designated by the Issuer) and in each case
maturing within one year after the date of acquisition, (vii) overnight bank
deposits and bankers' acceptances at any commercial bank organized in the United
States having capital and surplus in excess of $100,000,000, (viii) deposits
available for withdrawal on demand with commercial banks organized in the United
States having capital and surplus in excess of $50,000,000 and (ix) investments
in money market funds substantially all of whose assets comprise securities of
the types described in clauses (i) through (viii) above.
"Cash Flow" means, with respect to the Issuer for any period, the sum of
(i) cash dividends and distributions, (ii) cash repayments of intercompany loans
or advances outstanding at the date of this Indenture and (iii) tax payments
made without violation of the provisions of Section 4.11 hereof, in each case
received by the Issuer from any of its Subsidiaries, directly or indirectly, for
such period; provided that the term "Cash Flow" as used in the definition herein
of the term "Ratio of Cash Flow to Fixed Charges" shall refer to "Restricted
Subsidiaries" and not to "Subsidiaries."
"Cash on Hand" means Cash available for use by the Issuer in the operation
and/or winddown of its business, net of any Cash necessary to make Distributions
to holders of
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Administrative Claims, Fee Claims, Secured Claims, Priority Claims and Priority
Tax Claims (or, in the case of those of such Claims that are contingent Claims,
unliquidated Claims or Disputed Claims, to establish appropriate reserves), that
is not subject to any secured claims, interests, Liens or encumbrances other
than any Liens created pursuant to this Indenture or the Tranche A Indenture and
any New Credit Facility (all terms used in this definition that are not defined
herein being used as defined in the Plan).
"Change of Control" means an event whereby (i) any Person or Group (as such
term is defined in Rule 13d-5 of the Exchange Act) of related Persons (other
than a Wholly Owned Restricted Subsidiary or a member of the Initial Control
Group or, in each case, an Affiliate thereof) acquires all or substantially all
of the Issuer's assets (provided that any acquisition of assets or Equity
Interests pursuant to any one or more Principal Asset Sales shall not be deemed
an acquisition of all or substantially all of the Issuer's assets for purposes
of this provision); or (ii) any Person or Group (other than a Wholly Owned
Restricted Subsidiary or a member of the Initial Control Group or, in each case,
an Affiliate thereof) becomes, by way of merger, consolidation, other business
combination or otherwise, the Beneficial Owner of Voting Stock representing more
than 50% of the total voting power entitled to vote in the election of
directors, managers or trustees of the Issuer or such other Person surviving the
transaction; or (iii) during any period of two consecutive years after the
effective date of the Plan, individuals who at the beginning of such period
constituted the Board of Directors of the Issuer (together with any new
directors whose election by such Board of Directors or whose nomination for
election by the stockholders of the Issuer was approved by a vote of at least a
majority of the directors then still in office who were either directors at the
beginning of such period or whose election or nomination was previously so
approved or any new directors who were nominated to serve on behalf of the
Initial Control Group) cease for any reason to constitute a majority of the
Board of Directors of the Issuer then in office.
"Collateral" has the meaning set forth in the Pledge Agreement.
"Commission" or "SEC" means the Securities and Exchange Commission and any
successor agency.
"Consolidated Net Worth" means, with respect to any Person, the value of
the common, partnership or other equity of such Person and its Consolidated
Subsidiaries, as determined on a consolidated basis in accordance with GAAP.
"Consolidated Subsidiary" shall mean with respect to any Person at any date
any Subsidiary or other entity the accounts of which would be consolidated in
accordance with GAAP with those of such Person in its consolidated financial
statements as of such date.
"Corporate Trust Office of the Trustee" shall be at the address of the
Trustee specified in Section 11.02 hereof or such other address as to which the
Trustee may give notice to the Issuer.
"Default" means any event that is or with the passage of time or the giving
of notice or both would be an Event of Default.
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"Definitive Notes" means Notes that are in the form of Note attached hereto
as Exhibit A that do not contain the provisions referred to in footnotes 2 and 3
thereto or the Schedule of Exchanges of Notes attached thereto.
"Depository" means, with respect to the Notes issuable or issued in whole
or in part as Global Notes, the Person specified in Section 2.03 hereof as the
Depository with respect to the Notes, until a successor shall have been
appointed and become such pursuant to the applicable provision of this
Indenture, and, thereafter, "Depository" shall mean or include such successor.
"Disqualified Stock" means any Capital Stock that, by its terms (or by the
terms of any security into which it is convertible or for which it is
exchangeable), or upon the happening of any event, matures or is mandatorily
redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable
at the option of the holder thereof, in whole or in part, on or prior to the
date that is 91 days after the date on which the Notes mature.
"Equity Interests" means Capital Stock and all warrants, options or other
rights to acquire Capital Stock (but excluding any debt security that is
convertible into, or exchangeable for, Capital Stock).
"Excess Cash" means, after deducting the amount necessary to fund the
Litigation Trust referred to in the Plan and all Cash on Hand, all Cash as and
when received by the Issuer from the Issuer's Subsidiaries that are not debtors
in the Chapter 11 Cases, which Cash is in the Issuer's cash management system as
of the effective date of the Plan.
"Excess Cash Flow" means, as of each April 30 and October 31, the Cash Flow
received by the Issuer for the six-month period ended on the preceding December
31 or June 30, as the case may be, net of operating expenses, payments with
respect to Indebtedness and Investments permitted hereunder and less reduction
for reserves established by the Board of Directors in good faith for working
capital, interest, capital expenditures and reorganization, wind-down and other
non-recurring costs and expenses, which amounts, including the amounts of any
such reserves, shall be set forth in an Officers' Certificate delivered to the
Trustee within ninety days after the last day of such six-month period, provided
that Excess Cash Flow shall not include (i) proceeds of Asset Sales or other
sales of assets or (ii) Excess Cash or other amounts reserved or held for
distributions to creditors or claimants pursuant to the Plan; and provided
further, that in the case of each six-month period for which Excess Cash Flow
has been determined hereunder, the Board of Directors shall, at the time that it
determines Excess Cash Flow for the subsequent six-month period, review the
reserves established for the prior six-month period and shall make such
adjustments thereto as it shall determine to be necessary in light of then
existing circumstances, and any such adjustments shall be used for purposes of
calculating Excess Cash Flow for such subsequent six-month period.
"Exchange Act" means the Securities Exchange Act of 1934, as amended.
"Existing Indebtedness" means Indebtedness of the Issuer or any of its
Restricted Subsidiaries (other than Indebtedness incurred pursuant to the Plan)
in existence on the date of this Indenture, after giving effect to the
provisions of the Plan.
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"Fixed Charges" means, with respect to the Issuer for any period, the sum,
without duplication, of (i) the aggregate amount of interest expense and
commitment and other fees with respect to Funded Indebtedness of the Issuer
Scheduled to be Paid for such period, including (A) net costs under Swaps, (B)
capitalized interest paid in cash, (C) the interest portion of any deferred
payment obligation and (D) payments in the nature of interest under Lease
Obligations and (ii) the aggregate amount of all mandatory scheduled fixed
payments (whether designated as payments or prepayments) and scheduled sinking
fund payments with respect to principal of any Funded Indebtedness of the
Issuer, including payments in the nature of principal under Lease Obligations.
"Funded Indebtedness" of a Person means all Indebtedness of such Person
(after intercompany eliminations) other than any Guaranty obligations that are
not reasonably quantifiable under standard accounting practices as of the date
of determination.
"GAAP" means generally accepted accounting principles set forth in the
opinions and pronouncements of the Accounting Principles Board of the American
Institute of Certified Public Accountants and in statements and pronouncements
of the Financial Accounting Standards Board or in such other statements by such
other entity as have been approved by a significant segment of the accounting
profession, which are in effect on the date of this Indenture.
"Global Note" means a Note that contains the provisions referred to in
footnotes 2 and 3 to the form of Note attached hereto as Exhibit A and the
Schedule of Exchanges of Notes attached thereto.
"GTN" means Gas Transmission Northwest Corporation, a California
corporation.
"GTN Entity" means Gas Transmission Corporation and each of its Restricted
Subsidiaries and their respective successors.
"Guaranty" shall mean (a) a guaranty by a Person (other than by endorsement
of negotiable instruments for deposit or collection in the ordinary course of
business), directly or indirectly, in any manner, of any part or all of the
obligations of another Person; or (b) an agreement by a Person, direct or
indirect, contingent or otherwise, and whether or not constituting a guaranty,
the practical effect of which is to assure the payment or performance (or
payment of damages in the event of nonperformance) of any part or all of the
obligations of another Person (other than in respect of operating leases),
whether by (i) the purchase of securities or obligations, (ii) the purchase,
sale or lease of property or the purchase or sale of services primarily for the
purpose of enabling the obligor with respect to such obligation to make any
payment or performance (or payment of damages in the event of nonperformance) of
or on account of any part or all of such obligation, or to assure the obligee of
such obligation against loss, (iii) repayment of amounts drawn by beneficiaries
of letters of credit, (iv) the maintenance of working capital, equity capital,
available cash or other financial statement condition so as to enable the
primary obligor to pay Indebtedness, (v) the provision of equity or other
capital under or in respect of equity or other capital subscription
arrangements, (vi) the supplying of funds to or investing in a Person on account
of all or any part of such Person's obligations or indemnifying or holding
harmless such Person against any part or all of such obligations or (vii)
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the placing of any Lien on property (including, without limitation, accounts and
contract rights) of a Person to secure another Person's Indebtedness.
"Holder" means a Person in whose name a Note is registered.
"Indebtedness" means, with respect to any Person, without duplication, any
indebtedness of such Person in respect of borrowed money or evidenced by bonds,
notes, debentures or similar instruments or letters of credit (or reimbursement
agreements in respect thereof) or bankers' acceptances or representing Lease
Obligations, or arising under any conditional sale or other title retention
agreement with respect to property acquired by such Person (even though the
rights and remedies of the seller or lender under such agreement in the event of
default are limited to repossession or sale of such property), or the balance
deferred and unpaid of the purchase price of any property (except any such
balance that constitutes an accrued expense or trade payable), if and to the
extent that any of the foregoing indebtedness (other than letters of credit)
would appear as a liability upon a balance sheet of such Person prepared in
accordance with GAAP, as well as all Indebtedness of others secured by a Lien on
any asset of such Person (whether or not such Indebtedness is assumed by such
Person) to the extent of the fair market value of such asset where the
Indebtedness so secured is not the Indebtedness of such Person and, to the
extent not otherwise included, the Guaranty by such Person of any Indebtedness
of any other Person.
"Indirect Participant" means a Person who holds a beneficial interest in a
Global Note through a Participant.
"Initial Control Group" means any Person or Group (as such term is defined
in Rule 13d-5 under the Exchange Act) which immediately after the consummation
of the Reorganization is the Beneficial Owner of at least 10% of the outstanding
common stock of the Issuer or any Affiliate of any such Person or Group.
"Insolvency or Liquidation Proceeding" means (i) any insolvency or
bankruptcy case or proceeding, or any receivership, liquidation, reorganization
or other similar case or proceeding, relative to the Issuer or to the creditors
of the Issuer, as such, or to the assets of the Issuer, (ii) any liquidation,
dissolution, reorganization or winding up of the Issuer, whether voluntary or
involuntary and involving insolvency or bankruptcy, or (iii) any assignment for
the benefit of creditors or any other marshalling of assets and liabilities of
the Issuer.
"Intercreditor Agreement" means the Collateral Agency and Intercreditor
Agreement dated as of the date hereof among the Issuer, the Trustee, the Tranche
A Trustee, any Person made a party thereto pursuant to a New Credit Facility and
the collateral agent named in such Collateral Agency and Intercreditor
Agreement, substantially in the form attached hereto as Exhibit C, as the same
may be amended, supplemented or otherwise modified from time to time in
accordance with the provisions hereof and thereof.
"Interest Payment Date" has the meaning set forth in Exhibit A hereto.
"Investment Vehicle" means each Restricted Subsidiary of the Issuer which
is organized solely to acquire, make or hold one or more investments in an
Operating Company or Operating Companies, either directly or indirectly through
one or more other Investment Vehicles.
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"Investments" means, with respect to any Person, all investments by such
Person in other Persons (including Affiliates) in the forms of direct or
indirect loans (including Guaranties of Indebtedness or other obligations but
excluding Guaranties issued in compliance with this Indenture), advances or
capital contributions (excluding advances to officers and employees made in the
ordinary course of business) and purchases or other acquisitions for
consideration of Indebtedness, Equity Interests or other securities, together
with all items that are or would be classified as investments on a balance sheet
prepared in accordance with GAAP. If the Issuer or any Restricted Subsidiary of
the Issuer sells or otherwise disposes of any Equity Interests of any direct or
indirect Restricted Subsidiary of the Issuer such that, after giving effect to
any such sale or disposition, such Person is no longer a Restricted Subsidiary
of the Issuer or another Restricted Subsidiary, the Issuer shall be deemed to
have made an Investment on the date of any such sale or disposition equal to the
fair market value of the Equity Interests of such Subsidiary not sold or
disposed of in an amount determined as provided in subsection (e) of Section
4.07 hereof. A provision in an agreement relating to the purchase or sale of any
of the Issuer's or its Restricted Subsidiaries' assets containing an "earn out"
or providing for an adjustment to the purchase or sale price based on a
financial statement relating to the assets purchased or sold shall not be deemed
to be an "Investment."
"IPP Entity" means (i) National Energy Power Company, LLC and each of its
Restricted Subsidiaries, (ii) Madison Windpower LLC, (iii) Plains End, LLC and
(iv) any Restricted Subsidiary of the Issuer formed, pursuant to the provisions
of an IPP Sale Agreement, to hold Equity Interests of another IPP Entity, and in
each case their respective successors.
"IPP Sale Agreement" means any agreement or instrument to which one or more
Restricted Subsidiaries of the Issuer are party, providing for the sale by a
Restricted Subsidiary of Equity Interests or assets of any of the IPP Entities
or for transactions relating thereto.
"Lease Obligations" means any Indebtedness represented by obligations under
a lease that is required to be capitalized for financial reporting purposes,
with the amount of such Indebtedness to be determined in accordance with GAAP.
"Lien" means, with respect to any asset, any mortgage, lien, pledge,
charge, security interest or encumbrance of any kind in respect of such asset,
whether or not filed, recorded or otherwise perfected under applicable law
(including any conditional sale or other title retention agreement, any lease in
the nature thereof, any option or other agreement to sell or give a security
interest in and any filing of or agreement to give any financing statement under
the Uniform Commercial Code (or equivalent statutes) of any jurisdiction).
"Net Proceeds" means the aggregate cash proceeds received by the Issuer in
respect of an Asset Sale by the Issuer or received by the Issuer from any
Restricted Subsidiary in respect of an Asset Sale by such Restricted Subsidiary
or by any direct or indirect subsidiary thereof (including in each case, without
limitation, any cash received upon the sale, payment or other disposition of any
non-cash consideration received in any Asset Sale and any cash received by the
Issuer upon release or termination of any reserve, escrow or holdback referred
to below), net of the direct costs relating to such Asset Sale (including,
without limitation, legal, accounting and investment banking fees, consent fees
to facilitate such Asset Sale and sales commissions), any relocation expenses
incurred as a result thereof, taxes paid or that may be payable as a result
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thereof (after taking into account any available tax credits or deductions and
any tax-sharing arrangements), any reserve or escrow that may be established in
accordance with GAAP or the terms of any agreement relating to such Asset Sale,
any other reserve or holdback established in good faith by the Board of
Directors of the Issuer or such Restricted Subsidiary on account of purchase
price adjustments or liabilities (including in respect of indemnification) that
may arise out of such transaction, any amount applied or held for application to
the funding of an investment referred to in item (o) of the definition of the
term "Permitted Investments" herein and the amount of any payment of the
outstanding principal of, premium or penalty, if any, and interest on any
indebtedness or obligation that is secured by a Lien on the asset in question or
that is otherwise required to be paid or repaid under the terms thereof;
provided, however, that aggregate cash proceeds shall not (i) include proceeds
of any loan made to a Restricted Subsidiary of the Issuer by or on behalf of any
purchaser of Assets or Equity Interests in accordance with the provisions of an
IPP Sale Agreement or (ii) be deemed to have been received by the Issuer from
any such Subsidiary in respect of an Asset Sale by such Subsidiary unless such
proceeds may be paid to the Issuer without legal or contractual restriction
applicable to such Subsidiary.
"New Credit Facility" means a working capital financing agreement (which
may include provisions for letters of credit) between or among any of the
Issuer, one or more Restricted Subsidiaries of the Issuer and one or more banks
or other financial institutions, including any related notes, guaranties,
collateral documents, instruments and agreements executed in connection
therewith, entered into after the confirmation date of the Plan, in each case as
amended, supplemented or otherwise modified from time to time.
"Non-Recourse Debt" means Indebtedness of any Operating Company or
Investment Vehicle (i) as to which neither the Issuer nor any Restricted
Subsidiary that is not a member of the same Operating Company Group (a) provides
credit support of any kind (including any undertaking, agreement or instrument
that would constitute Indebtedness (but excluding letters of credit referred to
in clause (b) of the definition of the term "Permitted Investments" herein), (b)
is directly or indirectly liable (as a guarantor or otherwise) or (c)
constitutes the lender and (ii) no default in respect of which would permit
(upon notice, lapse of time or both) any holder of any other Indebtedness of the
Issuer or any Restricted Subsidiary that is not a member of the same Operating
Company Group to declare a default on such other Indebtedness or cause the
payment thereof to be accelerated or payable prior to its Stated Maturity.
"Note Custodian" means the Trustee, as custodian with respect to the Notes
issued as Global Notes, or any successor entity thereto.
"Notes" has the meaning set forth in the Recitals to this Indenture and
more particularly means any Notes authenticated and delivered under this
Indenture, including any Secondary Notes.
"Obligations" means any principal, interest, penalties, expenses, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Indebtedness.
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"Officer" means, with respect to any Person, the Chairman of the Board, the
Chief Executive Officer, the President, the Chief Operating Officer, the Chief
Financial Officer, the Principal Accounting Officer, any Vice President, the
Treasurer, any Assistant Treasurer, the Controller or the Secretary of such
Person.
"Officers' Certificate" means a certificate signed on behalf of the Issuer
by two Officers of the Issuer and that meets the requirements of Section 11.05
hereof.
"Operating Company" means any Restricted Subsidiary (a) (i) whose principal
purpose is the acquisition, improvement, installation, design, engineering,
construction, development, completion, financing, maintenance or operation of
all or any part of a project or projects, or any asset related thereto, used in
the business of generating, transmitting, transporting, distributing, producing
or storing electric power, thermal energy, natural gas or other fuel or other
energy-related businesses and (ii) substantially all the assets of which are
limited to those assets that have been or are being or will be financed, or the
operation of which has been or is being or will be financed, in whole or in
part, by Non-Recourse Debt incurred by such Restricted Subsidiary and/or any
Investment Vehicle that is a member of the same Operating Company Group or,
subject to the provisions of Section 4.07 hereof, by contributions or
intercompany loans from the Issuer or any other Restricted Subsidiary, or (b)
which Restricted Subsidiary is a Subsidiary of an entity described in clause (a)
and the business and assets of which are related to the business of such entity
and which does not incur any Indebtedness other than Non-Recourse Debt or
contributions or intercompany loans from an Operating Company or Investment
Vehicle that is a member of the same Operating Company Group or, subject to the
provisions of Section 4.07 hereof, the Issuer or any other Restricted
Subsidiary.
"Operating Company Group", when used with reference to an Operating
Company, means such Operating Company, each Investment Vehicle that owns,
directly or indirectly, Equity Interests of such Operating Company and each
other Operating Company Equity Interests of which are owned, directly or
indirectly, by any such Investment Vehicle.
"Opinion of Counsel" means a written opinion from legal counsel who is
reasonably acceptable to the Trustee and that meets the requirements of Section
11.05 hereof. The counsel may be an employee of or counsel to the Issuer, any
Subsidiary of the Issuer or the Trustee.
"Participant" means, with respect to the Depository, a Person that has an
account with the Depository.
"Permitted Business" means (i) the business of generating, transmitting,
transporting, distributing, producing or storing electric power, thermal energy,
natural gas or other fuel, (ii) the development, acquisition, disposition,
financing and operation of projects and facilities for such purposes and other
businesses related or incidental thereto or that are a reasonable extension
thereof, (iii) ownership of Persons engaged in or assets used in such businesses
and (iv) other businesses engaged in by the Issuer or its Subsidiaries on the
date of this Indenture or similar lines of businesses to those engaged in by the
Issuer or its Subsidiaries on the date of this Indenture, but not including the
business of trading in power, energy or fuel except as necessary or incidental
to the businesses referred to in item (i) above.
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"Permitted Investments" means (a) any Investment in the Issuer or in a
Restricted Subsidiary of the Issuer (other than Investments (i) by the Issuer in
Operating Companies or Investment Vehicles (except as permitted by the following
clause (b)) or (ii) by Operating Companies or Investment Vehicles in other
Operating Companies or Investment Vehicles that are not members of the same
Operating Company Group); (b) any Investment by the Issuer consisting of the
provision by the Issuer of, or the arrangement by the Issuer for the issuance
of, any letter of credit to an Operating Company or Investment Vehicle for use
in its business; (c) any Investment in Cash Equivalents; (d) any Investment by
the Issuer or any Restricted Subsidiary of the Issuer in a Person if as a result
of such Investment (i) such Person becomes a Restricted Subsidiary of the Issuer
or (ii) such Person is merged, consolidated or amalgamated with or into, or
transfers or conveys substantially all of its assets to, or is liquidated into,
the Issuer or a Restricted Subsidiary of the Issuer; (e) any Investment made as
a result of the receipt of non-cash consideration from an Asset Sale that was
made in compliance with Section 4.10 hereof; (f) any Investment to the extent
made in exchange for the issuance of Equity Interests (other than Disqualified
Stock) of the Issuer or a Restricted Subsidiary; (g) obligations or securities
received in connection with any good faith settlement or Insolvency or
Liquidation Proceeding; (h) Swaps entered into in the ordinary course of
business in connection with the operation of the business of the Issuer and its
Restricted Subsidiaries or as required by any Indebtedness issued in compliance
with this Indenture; (i) prepaid expenses and loans or advances to employees and
similar items in the ordinary course of business; (j) endorsements of negotiable
instruments and other similar negotiable documents; (k) transactions with
Affiliates permitted under this Indenture; (l) Investments outstanding as of the
date of this Indenture or required to be made pursuant to an agreement existing
as of the date of this Indenture and by which the Issuer or any of its
Restricted Subsidiaries is bound; (m) investments permitted to be incurred as
Indebtedness under Section 4.09 hereof; (n) investments in the Litigation Trust
provided for in the Plan, subject to any limitations provided for in the Plan;
(o) Investments consisting of acquisitions by an IPP Entity, or by any other
Restricted Subsidiary of the Issuer that is party to an IPP Sale Agreement, of
assets or Equity Interests that were sold or transferred in an Asset Sale
effected pursuant to an IPP Sale Agreement, to the extent provided for in such
Agreement; and (p) other Investments in any Person having an aggregate fair
market value (measured on the date each such Investment was made and without
giving effect to subsequent changes in value), when taken together with all
other Investments made pursuant to this clause (p) that are at the time
outstanding, not to exceed the sum of (A) $5 million and (B) the aggregate net
cash proceeds (or non-cash proceeds when converted into cash) received by the
Issuer and its Restricted Subsidiaries from the sale or disposition of
investments existing as of the date of this Indenture or made pursuant to this
clause (p).
"Permitted Liens" means (i) Liens in favor of the Trustee or the Holders or
otherwise arising under this Indenture, the Notes or the Security Documents;
(ii) Liens in favor of the Tranche A Trustee or the Holders (as such term is
defined in the Tranche A Indenture) or otherwise arising under the Tranche A
Indenture or the Security Documents (as such term is defined in the Tranche A
Indenture), (iii) Liens securing Indebtedness and obligations under a New Credit
Facility; (iv) Liens securing Indebtedness permitted pursuant to any of items
(v), (vi), (ix), (xv) and (xvii) of the second paragraph of Section 4.09 hereof;
(v) Liens in favor of the Issuer or any Restricted Subsidiary; (vi) Liens on
property of a Person existing at the time such Person is merged into or
consolidated with the Issuer or any Restricted Subsidiary of the Issuer,
provided that such Liens do not extend to any assets other than those of the
Person merged into
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or consolidated with the Issuer; (vii) Liens on property existing at the time of
acquisition thereof by the Issuer or any Restricted Subsidiary of the Issuer;
(viii) Liens to secure Indebtedness (including Lease Obligations) permitted by
item (vii) of the second paragraph of Section 4.09 hereof covering only the
assets acquired with such Indebtedness and any improvements or accessions
thereto; (ix) Liens on any asset of the Issuer or any Restricted Subsidiary
incurred or assumed for the purpose of financing all or any part of the cost of
acquiring, constructing or improving such asset, provided that such Lien
attaches contemporaneously with, or within 12 months of, the purchase,
construction or improvement of such asset; (x) Liens existing on the date of
this Indenture; (xi) Liens for taxes, assessments or governmental charges or
claims that are not yet delinquent or that are being contested in good faith by
appropriate proceedings promptly instituted and diligently concluded, provided
that any reserve or other appropriate provision as shall be required in
conformity with GAAP shall have been made therefor; (xii) Liens incurred in
connection with Permitted Refinancing Indebtedness, but only if such Liens
extend to no more assets than the Liens securing the Indebtedness being
refinanced; (xiii) statutory Liens of landlords and carriers', warehousemen's,
mechanics', suppliers', materialmen's, repairmen's or other like Liens
(including contractual landlords' liens) arising in the ordinary course of
business; (xiv) Liens incurred or deposits made in the ordinary course of
business in connection with workers' compensation, unemployment insurance and
other types of social security; (xv) Liens incurred or deposits made to secure
the performance of tenders, bids, leases, statutory obligations, surety and
appeal bonds, government contracts, trade contracts, performance and
return-of-money bonds and other obligations of a like nature incurred in the
ordinary course of business (exclusive of obligations for the payment of
borrowed money); (xvi) easements, rights-of-way, zoning and other restrictions,
covenants, conditions, encroachments and matters of title that would be
disclosed by an accurate survey or inspection and other defects or
irregularities in title and other similar charges or encumbrances not
interfering in any material respect with the business of the Issuer and its
Subsidiaries; (xvii) Liens arising from filing Uniform Commercial Code financing
statements or similar instruments regarding leases (other than true leases and
true consignments); (xviii) Liens arising by or pursuant to operation of law in
connection with judgments or attachments, except to the extent that an Event of
Default occurs and is continuing under Section 6.01(f) hereof by reason of the
entry and lack of discharge of such judgment or attachment; (xix) licenses (with
respect to intellectual property and other property), leases or subleases not
interfering in any material respect with the ordinary conduct of the business of
the Issuer and its Subsidiaries; (xx) Liens which are provided for by the Plan,
including Liens consisting of restrictions on funds of the Issuer held for
distribution to creditors or other Persons pursuant to the Plan; (xxi) Liens
incurred pursuant to or in connection with an IPP Sale Agreement, provided that
such Liens do not attach to assets of the Issuer or of any Restricted Subsidiary
of the Issuer other than the IPP Entity or Entities whose assets or Equity
Interests are the subject of such Agreement or any Restricted Subsidiary that is
the seller of any such Equity Interests; (xxii) Liens insured pursuant to any
tax settlement agreement or arrangement permitted by clause (vii) of Section
4.11 hereof; and (xxiii) Liens incurred in the ordinary course of business of
the Issuer or any Restricted Subsidiary of the Issuer with respect to
obligations that do not exceed $5 million at any one time outstanding and that
are not incurred in connection with the borrowing of money or the obtaining of
advances or credit (other than trade credit in the ordinary course of business).
"Permitted Refinancing Indebtedness" means any Indebtedness of the Issuer
or any of its Restricted Subsidiaries issued in exchange for, or the net
proceeds of which are used to extend,
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refinance, renew, replace, defease or refund, other Indebtedness of the Issuer
or any of its Restricted Subsidiaries incurred or outstanding pursuant to any of
items (i), (viii), (xii), (xvi) of the second paragraph of Section 4.09 hereof;
provided that: (i) the principal amount (or accreted value, if applicable) of
such Permitted Refinancing Indebtedness does not exceed the amount that is the
sum of (i) the principal amount (or accreted value, if applicable), of the
Indebtedness so extended, refinanced, renewed, replaced, defeased or refunded
plus $5 million (except to the extent that any such increase over such principal
amount (or accreted value) is a result of a concurrent incurrence of additional
Indebtedness permitted under this Indenture), plus (ii) prepayment premium (or
any defeasance costs) and accrued interest on such Indebtedness plus (iii) the
amount of reasonable expenses incurred in connection therewith; (ii) such
Permitted Refinancing Indebtedness has a final maturity date later than the
final maturity date of, and has a Weighted Average Life to Maturity equal to or
greater than the Weighted Average Life to Maturity of, the Indebtedness being
extended, refinanced, renewed, replaced, defeased or refunded; (iii) if the
Indebtedness being extended, refinanced, renewed, replaced, defeased or refunded
is subordinated in right of payment to the Notes, such Permitted Refinancing
Indebtedness has a final maturity date later than the final maturity date of,
and is subordinated in right of payment to, the Notes on terms at least as
favorable to the Holders as those contained in the documentation governing the
Indebtedness being extended, refinanced, renewed, replaced, defeased or
refunded; and (iv) such Indebtedness is incurred either by the Issuer or by the
Restricted Subsidiary which is the obligor on the Indebtedness being extended,
refinanced, renewed, replaced, defeased or refunded.
"Permitted Sale-Leaseback Transactions" means Sale/Leaseback Transactions
entered into by an Operating Company in connection with or as part of a
financing permitted pursuant to item (v) of the second paragraph of Section 4.09
hereof.
"Person" means any individual, corporation, partnership, limited liability
company, joint venture, association, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or any
other entity.
"Plan of Reorganization" or "Plan" means the Modified Third Amended Plan of
Reorganization, dated April 28, 2004, of the Issuer, confirmed by the Bankruptcy
Court on May 3, 2004, as the same may be further amended, supplemented or
otherwise modified from time to time, providing for, inter alia, this Indenture.
"Pledge Agreement" means the Pledge Agreement dated as of the date hereof
between the Issuer and the Trustee, substantially in the form attached hereto as
Exhibit B, as the same may be amended, supplemented or otherwise modified from
time to time in accordance with the provisions hereof and thereof.
"Principal Asset Sale" means an Asset Sale consisting of a sale (i) by the
Issuer of Equity Interests of any of the GTN Entities or IPP Entities or (ii) by
a Restricted Subsidiary of the Issuer of Equity Interests or assets of any of
the GTN Entities or IPP Entities.
"Ratio of Cash Flow to Fixed Charges" means, as of the end of each fiscal
quarter of the Issuer, the ratio of (a) Cash Flow of the Issuer for the period
of four consecutive fiscal quarters ending on, or most recently ended prior to,
such date (or, if less, the number of full consecutive
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fiscal quarters that have elapsed since the effective date of the Plan) to (b)
Fixed Charges of the Issuer for such period.
"Reorganization" means the transactions consummated pursuant to the Plan.
"Responsible Officer," when used with respect to the Trustee, means any
officer within the corporate trust department of the Trustee (or any successor
group of the Trustee) or any other officer of the Trustee customarily performing
functions similar to those performed by any such officer and also means, with
respect to a particular corporate trust matter, any other officer to whom such
matter is referred because of such officer's knowledge of and familiarity with
the particular subject.
"Restricted Investment" means an Investment other than a Permitted
Investment.
"Restricted Subsidiary" of a Person means any Subsidiary of the referent
Person that is not an Unrestricted Subsidiary.
"Sale/Leaseback Transaction" means any lease whereby any Person becomes or
remains liable as lessee or as guarantor or other surety of any property,
whether now owned or hereafter acquired, that such Person has sold or
transferred or is to sell or transfer to any other Person (other than any
Subsidiary of such Person), as part of a financing transaction to which such
Person is a party, in contemplation of leasing such property to such Person.
"Scheduled to be Paid" means, with respect to any liability or expense for
any period, the amount of such liability or expense scheduled to be paid during
such period or the amount of such liability or expense that would have been
scheduled to be paid during such period had the payment schedule with respect to
such liability or expense been divided equally into successive periods having a
duration equal to the duration of such period.
"Secondary Notes" has the meaning set forth in Section 2.02 (b) hereof.
"Securities Act" means the Securities Act of 1933, as amended.
"Security Documents" means the Pledge Agreement and the Intercreditor
Agreement and any security instruments, financing statements and other documents
or instruments at any time executed by the Issuer or any Subsidiary thereof to
secure Obligations hereunder or under the Notes or the Security Documents.
"Service Company" means each Subsidiary of the Issuer the business of which
consists principally of providing management, operating or other services, or
employees, to other Subsidiaries of the Issuer.
"Significant Subsidiary" means any Restricted Subsidiary that would be a
"significant subsidiary" as defined in Article 1, Rule 1-02 of Regulation S-X,
promulgated pursuant to the Securities Act, as such Regulation is in effect on
the date of this Indenture.
"Stated Maturity" means, with respect to any installment of interest on or
accreted value or principal of any Indebtedness, the date on which such payment
of interest or principal is due
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or is scheduled to be paid pursuant to the original documentation governing such
Indebtedness and shall not include any contingent obligation to repay, redeem or
purchase any such interest, accreted value or principal prior to the date
originally scheduled for the payment or accretion thereof.
"Subsidiary" means, with respect to any Person, (i) any corporation,
association or other business entity of which more than 50% of the total voting
power of shares of Capital Stock entitled (without regard to the occurrence of
any contingency) to vote in the election of directors, managers or trustees
thereof is at the time owned or controlled, directly or indirectly, by such
Person or one or more of the other Subsidiaries of that Person (or a combination
thereof) and (ii) any partnership (a) the sole general partner or the managing
general partner of which is such Person or a Subsidiary of such Person or (b)
the only general partners of which are such Person or one or more Subsidiaries
of such Person (or any combination thereof).
"Swaps" means, with respect to any Person, payment obligations with respect
to interest rate swaps, currency swaps and similar obligations obligating such
Person to make payments, whether periodically or upon the happening of a
contingency. The amount of the obligation under any Swap shall be the amount
determined in respect thereof as of the end of the then most recently ended
fiscal quarter of such Person, based on the assumption that such Swap had
terminated at the end of such fiscal quarter, and in making such determination,
if any agreement relating to such Swap provides for the netting of amounts
payable by and to such Person thereunder of if any such agreement provides for
the simultaneous payment of amounts by and to such Person, then in each such
case, the amount of such obligation shall be the net amount so determined.
"TIA" means the Trust Indenture Act of 1939 (15 U.S.C. ▇▇.▇▇.
77aaa-77bbbb), as amended and in effect on the date on which this Indenture is
qualified under the TIA, except as provided in Section 9.03 hereof.
"Tranche A Indenture" means the Indenture dated as of the date hereof
between the Issuer and The Bank of New York, as trustee, provided for in the
Plan.
"Tranche A Notes" means the Secured Tranche A Term Notes of the Issuer,
issued pursuant to the Tranche A Indenture.
"Tranche A Trustee" means the trustee under the Tranche A Indenture.
"Trustee" means the party named as such above until a successor replaces it
in accordance with the applicable provisions of this Indenture and thereafter
means the successor serving hereunder.
"United States Government Obligations" means direct obligations of the
United States of America, or any agency or instrumentality thereof, with respect
to the payment of which the full faith and credit of the United States of
America is pledged.
"Unrestricted Subsidiary" means (i) each Subsidiary specified on Schedule A
hereto and (ii) any Subsidiary (other than a GTN Entity or an IPP Entity) that
is designated after the date of this Indenture pursuant to a Board Resolution as
an Unrestricted Subsidiary, but only to the
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extent that such Subsidiary (a) has no Indebtedness other than Non-Recourse
Debt; (b) on the date of such designation is not party to any agreement,
contract, arrangement or understanding with the Issuer or any Restricted
Subsidiary of the Issuer unless the terms of any such agreement, contract,
arrangement or understanding are no less favorable to the Issuer or such
Restricted Subsidiary than those that might be obtained at the time from Persons
who are not Affiliates of the Issuer; (c) is a Person with respect to which
neither the Issuer nor any of its Restricted Subsidiaries has any direct or
indirect obligation (x) to subscribe for additional Equity Interests or (y) to
maintain or preserve such Person's financial condition or to cause such Person
to achieve any specified levels of operating results; and (d) has not guaranteed
or otherwise directly or indirectly provided credit support for any Indebtedness
of the Issuer or any of its Restricted Subsidiaries. Any such designation by the
Board of Directors of the Issuer shall be evidenced to the Trustee by filing
with the Trustee a certified copy of the Board Resolution giving effect to such
designation and an Officers' Certificate certifying that such designation
complied with the foregoing conditions and was permitted by Section 4.07 hereof.
If at any time, any Unrestricted Subsidiary so designated would fail to meet the
foregoing requirements as an Unrestricted Subsidiary, it shall thereafter cease
to be an Unrestricted Subsidiary for purposes of this Indenture, and any
Indebtedness of such Subsidiary shall be deemed to be incurred by a Restricted
Subsidiary of such Issuer as of such date (and, if such Indebtedness is not
permitted to be incurred as of such date under Section 4.09 hereof, the Issuer
shall be in default of such covenant). The Board of Directors of the Issuer may
at any time designate any Unrestricted Subsidiary to be a Restricted Subsidiary,
provided that such designation shall be deemed to be an incurrence of
Indebtedness by a Restricted Subsidiary of the Issuer of any outstanding
Indebtedness of such Unrestricted Subsidiary, and such designation shall only be
permitted if (i) such Indebtedness is permitted under Section 4.09 hereof,
calculated on a pro forma basis as if such designation had occurred at the
beginning of the four-quarter reference period, and (ii) no Default or Event of
Default would be in existence following such designation.
"Voting Stock" of any Person as of any date means the Capital Stock of such
Person that is at the time entitled to vote in the election of the Board of
Directors of such Person.
"Weighted Average Life to Maturity" means, when applied to any Indebtedness
at any date, the number of years obtained by dividing (i) the sum of the
products obtained by multiplying (a) the amount of each then remaining
installment, sinking fund, serial maturity or other required payments of
principal, including payment at final maturity, in respect thereof, by (b) the
number of years (calculated to the nearest one-twelfth) that will elapse between
such date and the making of such payment, by (ii) the then outstanding principal
amount of such Indebtedness.
"Wholly Owned Restricted Subsidiary" of any Person means a Restricted
Subsidiary of such Person, all of the outstanding Capital Stock or other
ownership interests of which (other than directors' qualifying shares) shall at
the time be owned by such Person or by one or more Wholly Owned Restricted
Subsidiaries of such Person.
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Section 1.02. Other Definitions.
Defined
Term in Section
---- ----------
"Affiliate Transaction".............................................. 4.11
"Change of Control Offer"............................................ 4.15
"Chapter 11 Cases"................................................... Recitals
"DTC"................................................................ 2.03
"Debtors"............................................................ Recitals
"Event of Default"................................................... 6.01
"incur".............................................................. 4.09
"Issuer"............................................................. Recitals
"Offer Period"....................................................... 3.10
"Paying Agent"....................................................... 2.03
"Permitted Consideration"............................................ 4.10
"Permitted Debt"..................................................... 4.09
"Purchase Date"...................................................... 3.10
"Purchase Offer"..................................................... 3.10
"Registrar".......................................................... 2.03
Section 1.03. 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 of a Note;
"indenture to be qualified" means this Indenture;
"indenture trustee" or "institutional trustee" means the Trustee; and
"obligor" on the Notes means the Issuer and any successor obligor upon the
Notes.
All other terms used in this Indenture that are defined by the TIA, defined
by TIA reference to another statute or defined by SEC rule under the TIA have
the meanings so assigned to them.
Section 1.04. Rules of Construction.
Unless the context otherwise requires:
(1) a term has the meaning assigned to it;
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(2) an accounting term not otherwise defined has the meaning assigned to it
in accordance with GAAP;
(3) "or" is not exclusive;
(4) words in the singular include the plural, and in the plural include the
singular;
(5) all references in this instrument to designated "Articles", "Sections"
and other subdivisions are to the designated Articles, Sections and
subdivisions of this instrument as originally executed; the words "herein",
"hereof" and "hereunder" and other words of similar import refer to this
Indenture as a whole and not to any particular Article, Section or other
subdivision;
(6) provisions apply to successive events and transactions; and
(7) references to sections of or rules under the Securities Act shall be
deemed to include substitute, replacement or successor sections or rules
adopted by the SEC from time to time.
ARTICLE 2.
THE NOTES
Section 2.01. Form and Dating.
(a) General. The Notes and the Trustee's certificate of authentication
shall be substantially in the form of Exhibit A hereto, which is hereby
incorporated in and expressly made part of this Indenture. The Notes may have
notations, legends or endorsements required by law, stock exchange rule, custom
or usage. Each Note shall be dated the date of its authentication.
The terms and provisions contained in the Notes shall constitute, and are
hereby expressly made, a part of this Indenture, and the Issuer and the Trustee,
by their execution and delivery of this Indenture, expressly agree to such terms
and provisions and to be bound thereby. However, to the extent any provision of
any Note conflicts with the express provisions of this Indenture, the provisions
of this Indenture shall govern and be controlling.
(b) Form of Note. Global Notes shall be substantially in the form of
Exhibit A hereto (including the text referred to in footnotes 2 and 3 thereto
and the Schedule of Exchanges of Notes attached thereto). Definitive Notes shall
be substantially in the form of Exhibit A hereto (but without including the text
referred to in footnotes 2 and 3 thereto or the Schedule of Exchange of Notes
attached thereto). Definitive Notes (other than Secondary Notes) shall be in
denominations of $1,000 and integral multiples thereof, except that Definitive
Notes issued, pursuant to subsection (d) below, in respect of beneficial
interests in a Global Note referred to in clause (ii) of the last sentence of
subsection (c) below may be issued in the denominations referred to in such
clause. Each Global Note shall represent such of the outstanding Notes as shall
be specified therein, and each shall provide that it shall represent the
aggregate principal amount of outstanding Notes from time to time endorsed
thereon and that the aggregate principal amount of outstanding Notes represented
thereby may from time to time be reduced or increased,
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as appropriate, to reflect exchanges and redemptions. Any endorsement of a
Global Note to reflect the amount of any increase or decrease in the aggregate
principal amount of outstanding Notes represented thereby shall be made by the
Trustee or the Note Custodian, at the direction of the Trustee, upon receipt of
and in accordance with written instructions given by the Holder thereof as
required by Section 2.06 hereof.
(c) Book-Entry Provisions. This Section 2.01(c) shall apply only to Global
Notes deposited with the Trustee, as custodian for the Depository. Participants
and Indirect Participants shall have no rights under this Indenture with respect
to any Global Note held on their behalf by the Depository or by the Trustee as
the custodian for the Depository or under such Global Note, and the Depository
shall be treated by the Issuer, the Trustee and any agent of the Issuer or the
Trustee as the absolute owner of such Global Note for all purposes whatsoever.
Notwithstanding the foregoing, nothing herein shall prevent or be deemed to
prevent (i) the Issuer, the Trustee or any agent of the Issuer 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
Participants or Indirect Participants, the Applicable Procedures or the
operation of customary practices of the Depository governing the exercise of the
rights of a holder of a beneficial interest in any Global Note or (ii)
Participants or Indirect Participants from holding beneficial interests in a
Global Note in denominations of $1.00 or integral multiples thereof, provided
that each Note or Notes issued upon any registration of transfer or exchange of
any Note (other than Secondary Notes), or pursuant to Section 2.10, 3.06 or
3.10(g) hereof, shall be issued in the denominations required by Section 2.06
(d) (ix) hereof.
(d) Certificated Securities. The Issuer may initially issue the Notes as
Definitive Notes. However, the initial issuance of Definitive Notes does not
preclude the issuance of Global Notes upon the deposit of such Definitive Notes
with the Trustee, as custodian for the Depository. If at any time the Depository
notifies the Issuer that it is unwilling or unable to continue as Depository or
if at any time the Depository shall no longer be eligible under this Section
2.01, the Issuer shall appoint a successor Depository. If a successor Depository
is not appointed by the Issuer within ninety (90) days after the Issuer receives
such notice or becomes aware of such ineligibility, the Issuer's election that
the Notes be represented by Global Notes shall no longer be effective, and the
Issuer will execute, and the Trustee, upon receipt of written order signed by an
Officer of the Issuer for the authentication and delivery of Definitive Notes,
will authenticate and deliver Definitive Notes, in authorized denominations, in
an aggregate principal amount, and of like terms and tenor, equal to the
principal amount of the Global Notes in exchange for such Global Notes.
The Issuer may at any time and in its sole discretion determine that Notes
shall no longer be represented by Global Notes. In such event, the Issuer will
execute, and the Trustee, upon receipt of an Issuer order for the authentication
and delivery of definitive Notes of the same terms and tenor, will authenticate
and deliver Definitive Notes, in authorized denominations, and in an aggregate
principal amount equal to the principal amount of the Global Notes in exchange
for such Global Notes.
If specified by the Issuer, pursuant to this Section 2.01 with respect to
Global Notes, the Depository may surrender Global Notes in exchange in whole or
in part for Definitive Notes of like terms and tenor on such terms as are
acceptable to the Issuer and the Depository.
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Thereupon, the Issuer shall execute, and the Trustee, upon receipt of an Issuer
order for the authentication and delivery of Definitive Notes, shall
authenticate and deliver, without service charge to the Holders:
(i) to each Person specified by such Depository a new Definitive Note
of the same tenor, in authorized denominations, in an aggregate principal
amount equal to and in exchange for such Person's beneficial interest in
the Global Note; and
(ii) to the Depository a new Global Note in a denomination equal to
the difference, if any, between the principal amount of the surrendered
Global Note and the aggregate principal amount of the Definitive Notes
delivered to Holders pursuant to clause (i) above.
Upon the exchange of a Global Note for Definitive Notes, such Global Note
shall be cancelled by the Trustee or an agent of the Issuer or the Trustee.
Definitive Notes delivered in exchange for a Global Note pursuant to this
Section 2.01(d) shall be registered in such names and in such authorized
denominations as the Depository, pursuant to instructions from its Participants
or otherwise, shall instruct the Trustee or an agent of the Issuer or the
Trustee in writing. The Trustee or such agent shall deliver each such Note to or
as directed by the Persons in whose names such Note is so registered or to the
Depository.
Section 2.02. Execution and Authentication; Payment of Interest by Issuance of
Additional Notes.
(a) An Officer shall sign the Notes for the Issuer by manual or facsimile
signature. If an Officer whose signature is on a Note no longer holds that
office at the time a Note is authenticated, the Note shall nevertheless be
valid.
A Note shall not be valid until authenticated by the manual signature of an
authorized officer of the Trustee. The signature shall be conclusive evidence
that the Note has been authenticated under this Indenture.
The Trustee shall, upon a written order of the Issuer signed by an Officer
thereof, authenticate Notes for original issue up to the aggregate principal
amount stated in paragraph 5 of the Notes. Such order shall specify the
principal amount of the Notes and the date or dates (or the method of
determining the same) on which the Notes are to be authenticated.
The Trustee may appoint an authenticating agent acceptable to the Issuer 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 such agent. An authenticating agent has the
same rights as an Agent to deal with the Issuer or an Affiliate of the Issuer.
(b) On either or both of the first two Interest Payment Dates, in lieu of
payment in whole or in part of interest in cash on the Notes as provided
therein, the Issuer, at is option and in its sole discretion upon five Business
Days' prior notice to the Trustee, may, as hereafter provided, pay interest on
the Notes, in whole or in part, through the issuance of additional Notes
("Secondary Notes") in an aggregate principal amount equal to the amount of
interest payable
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with respect to such Notes at the rate then applicable as a result of the
payment of such interest by the issuance of Secondary Notes. Each issuance of
Secondary Notes in lieu of the payment of interest in cash on the Notes shall be
made pro rata with respect to the outstanding Notes, and the Issuer shall have
the right to aggregate amounts of interest payable in the form of Secondary
Notes to a Holder of outstanding Notes and issue to such Holder a single
Secondary Note in payment thereof. Any Secondary Notes may be deemed a separate
series of Notes if the Issuer deems it necessary to do so in order to comply
with any law or other applicable regulation or requirement, with appropriate
distinguishing designations.
On each Interest Payment Date on which Secondary Notes are to be issued,
the Trustee shall, upon written order of the Issuer, authenticate and deliver
Secondary Notes for original issuance to the Persons in whose name the Notes are
registered at the close of business on the relevant interest record date in the
aggregate principal amount required to pay such interest. Any Secondary Notes so
issued (a) shall be dated the applicable Interest Payment Date, (b) shall bear
interest from and after such date, (c) shall be governed by, and be subject to,
the terms, provisions and conditions of this Indenture and (d) shall entitle the
Holder thereof to the same rights and benefits as Notes previously issued. Any
such Secondary Notes shall be mailed to the Persons entitled thereto at their
addresses appearing in the Note register.
Notwithstanding the foregoing provisions of this subsection (b), the Issuer
shall not issue Secondary Notes in any denomination less than $1.00, and the
principal amount of Secondary Notes shall be rounded down to the nearest $1.00.
All amounts not included in Secondary Notes as a result of such rounding down of
the principal amount thereof shall not carry forward to any subsequent Interest
Payment Date and shall be forever forfeited.
Section 2.03. Registrar and Paying Agent.
The Issuer shall maintain an office or agency where Notes may be presented
for registration of transfer or for exchange ("Registrar") and an office or
agency where Notes may be presented for payment ("Paying Agent"). The Registrar
shall keep a register of the Notes and of their transfer and exchange. The
Issuer may appoint one or more co-registrars and one or more additional paying
agents. The term "Registrar" includes any co-registrar and the term "Paying
Agent" includes any additional paying agent. The Issuer may change any Paying
Agent or Registrar without notice to any Holder. The Issuer shall notify the
Trustee in writing of the name and address of any Agent not a party to this
Indenture. If the Issuer fails to appoint or maintain another entity as
Registrar or Paying Agent, the Trustee shall act as such. The Issuer or any of
its Subsidiaries may act as Paying Agent or Registrar.
The Issuer initially appoints The Depository Trust Company ("DTC") to act
as Depository with respect to the Global Notes.
The Issuer initially appoints the Trustee to act as the Registrar and
Paying Agent and to act as Note Custodian with respect to the Global Notes.
Section 2.04. Paying Agent to Hold Money in Trust.
Not later than 10:00 a.m. (New York City time) on each due date of the
principal of or interest on any of the Notes, the Issuer shall deposit with the
Paying Agent money in
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immediately available funds (or, to the extent permitted by Section 2.02(b)
hereof, Secondary Notes) sufficient to pay such principal or interest so
becoming due. The Issuer shall require any Paying Agent other than the Trustee
to agree in writing that such Paying Agent shall hold in trust for the benefit
of Holders or the Trustee all money and Secondary Notes held by such Paying
Agent for the payment of principal, premium or interest on the Notes, and shall
notify the Trustee of any default by the Issuer in making any such payment.
While any such default continues, the Trustee may require the Paying Agent to
pay all money and deliver all Secondary Notes held by it to the Trustee. The
Issuer at any time may require the Paying Agent to pay all money and deliver all
Secondary Notes held by it to the Trustee. Upon payment over to the Trustee, the
Paying Agent (if other than the Issuer or a Subsidiary) shall have no further
liability for the money or Secondary Notes. If the Issuer or a Subsidiary acts
as Paying Agent, it shall segregate and hold in a separate trust fund for the
benefit of the Holders all money and Secondary Notes held by it as Paying Agent.
Upon any Insolvency or Liquidation Proceeding, the Trustee shall serve as Paying
Agent for the Notes.
Section 2.05. Holder Lists.
The Trustee shall preserve in as current a form as is reasonably
practicable the most recent list available to it of the names and addresses of
all Holders and shall otherwise comply with TIA ss. 312(a). If the Trustee is
not the Registrar, the Issuer shall furnish to the Trustee at least seven
Business Days before each interest payment date and at such other times as the
Trustee may request in writing a list in such form and as of such date as the
Trustee may reasonably require of the names and addresses of the Holders, and
the Issuer shall otherwise comply with TIA ss. 312(a).
Section 2.06. Transfer and Exchange.
(a) Transfer and Exchange. When Notes are presented to the 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 if its requirements for such transactions are
met; provided, however, that any Note presented or surrendered for transfer or
exchange shall be duly endorsed or accompanied by a written instruction of
transfer in form satisfactory to the Registrar and the Trustee duly executed by
the Holder thereof or by such ▇▇▇▇▇▇'s attorney duly authorized in writing. To
permit registrations of transfers and exchanges, the Issuer shall execute and
the Trustee shall authenticate Global Notes and Definitive Notes upon the
Issuer's order or at the Registrar's request.
(b) Global Note Legend. Each Global Note shall bear a legend in
substantially the following form:
"THIS GLOBAL NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS
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GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT TO SECTION
2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO A
SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUER."
(c) Cancellation and/or Adjustment of Global Notes. At such time as all
beneficial interests in Global Notes have been exchanged for Definitive Notes,
redeemed, repurchased or cancelled, all Global Notes shall be returned to or
retained and cancelled by the Trustee in accordance with Section 2.11 hereof. At
any time prior to such cancellation, if any beneficial interest in a Global Note
is exchanged for Definitive Notes, redeemed, repurchased or cancelled, the
principal amount of Notes represented by such Global Note shall be reduced
accordingly, and an endorsement shall be made on such Global Note by the Trustee
or the Note Custodian, at the direction of the Trustee, to reflect such
reduction.
(d) General Provisions Relating to Transfers and Exchanges.
(i) To permit registrations of transfers and exchanges, the Issuer
shall execute and the Trustee shall authenticate Definitive Notes and Global
Notes upon receipt of a written order signed by an Officer of the Issuer or at
the Registrar's written request.
(ii) No service charge shall be made to a holder of a beneficial
interest in a Global Note or a Holder for any registration of transfer or
exchange, but the Issuer may require payment of a sum sufficient to cover any
transfer tax or similar governmental charge payable in connection therewith
(other than any such transfer taxes or similar governmental charge payable upon
exchange or transfer solely pursuant to Section 3.06, 3.10 or 9.05 hereof).
(iii) The Registrar shall not be required to register the transfer of
or exchange any Note selected for redemption in whole or in part, except the
unredeemed portion of any Note being redeemed in part.
(iv) All Definitive Notes and Global Notes issued upon any
registration of transfer or exchange of Definitive Notes or Global Notes shall
be the valid obligations of the Issuer, evidencing the same debt, and entitled
to the same benefits under this Indenture, as the Definitive Notes or Global
Notes surrendered upon such registration of transfer or exchange.
(v) The Issuer shall not be required to issue, to register the
transfer of or to exchange Notes during a period beginning at the opening of
business 15 days before the day of mailing of a notice of redemption of Notes
under Section 3.03 hereof and ending at the close of business on the day of such
mailing, or to register the transfer of or to exchange any Note so selected for
redemption in whole or in part, except the unredeemed portion of any Note being
redeemed in part, or to register the transfer of or to exchange a Note between a
record date and the next succeeding interest payment date.
(vi) Prior to due presentment for the registration of transfer of any
Note, the Trustee, any Agent and the Issuer may deem and treat the Person in
whose name such Note is registered as the absolute owner of such Note for the
purpose of receiving payment of principal of, premium, if any, and interest on
such Note and for all other purposes, subject to the
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provisions of this Indenture and the Notes relating to record dates for the
payment of interest, and neither the Trustee, any Agent nor the Issuer shall be
affected by notice to the contrary.
(vii) The Trustee shall authenticate Definitive Notes and Global Notes
in accordance with the provisions of Section 2.02 hereof.
(viii) All certificates required to be submitted to the Registrar
pursuant to this Section 2.06 to effect a registration of transfer or exchange
may be submitted by facsimile.
(ix) Each Note or Notes issued upon any registration of transfer or
exchange of any Note (other than Secondary Notes), or pursuant to Section 2.10,
3.06 or 3.10(g) hereof, shall be issued in denominations of $1,000 or integral
multiples thereof, except that not more than one (1) new Note so being issued in
respect of the Note being surrendered (the "surrendered Note") may be in a
denomination that is not $1,000 or an integral multiple thereof. Notes (other
than Secondary Notes) may not be surrendered for combination into a Note with a
principal amount that is not $1,000 or an integral multiple thereof.
The Trustee shall have no obligation or duty to monitor, determine or
inquire as to compliance with any restrictions on transfer imposed under this
Indenture or under applicable law with respect to any transfer of any interest
in any Note (including any transfers between or among Participants or beneficial
owners of interests in any Global Note) other than to require delivery of such
certificates and other documentation or evidence as are expressly required by
this Indenture and to examine the same to determine substantial compliance as to
form with the express requirements hereof.
Section 2.07. Replacement Notes.
If any mutilated Note is surrendered to the Trustee, or if the Issuer and
the Trustee receive evidence to their satisfaction of the destruction, loss or
theft of any Note, the Issuer shall issue and the Trustee, upon the written
order of the Issuer signed by an Officer of the Issuer, shall authenticate a
replacement Note if the requirements of this Section 2.07 are met. If required
by the Issuer or the Trustee, an indemnity bond must be supplied by the Holder
that is sufficient in the judgment of the Trustee and the Issuer to protect the
Issuer, the Trustee, any Agent and any authenticating agent from any loss that
any of them may suffer if a Note is replaced. The Issuer may charge for its
expenses in replacing a Note.
Every replacement Note is an additional obligation of the Issuer and shall
be entitled to all of the benefits of this Indenture equally and proportionately
with all other Notes duly issued hereunder.
Section 2.08. Outstanding Notes.
The Notes outstanding at any time are all the Notes authenticated by the
Trustee except those cancelled by it, those delivered to it for cancellation,
those reductions in the interest in a Global Note effected by the Trustee in
accordance with the provisions hereof and those described in this Section 2.08
as not outstanding. Except as set forth in Section 2.09 hereof, a Note does not
cease to be outstanding because the Issuer or an Affiliate of the Issuer holds
such Note.
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If a Note is replaced pursuant to Section 2.07 hereof, it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Note is held by a bona fide purchaser.
If the principal amount of any Note is considered paid under Section 4.01
hereof, it ceases to be outstanding and interest on it ceases to accrue.
If the Paying Agent (other than the Issuer, a Subsidiary or an Affiliate of
any thereof) holds, on a redemption date or maturity date, money sufficient to
pay Notes payable on that date, then on and after that date such Notes shall be
deemed to be no longer outstanding and shall cease to accrue interest.
Section 2.09. Treasury Notes.
In determining whether the Holders of the required principal amount of
Notes have concurred in any direction, waiver or consent, Notes owned by the
Issuer or by any Affiliate of the Issuer shall be considered as though not
outstanding, except that for the purposes of determining whether the Trustee
shall be protected in relying on any such direction, waiver or consent, only
Notes that a Responsible Officer of the Trustee actually knows are so owned
shall be so disregarded. Notes so owned that have been pledged in good faith
shall not be disregarded if the pledgee establishes, to the satisfaction of the
Trustee, the pledgee's right to deliver any such direction, waiver or consent
with respect to the Notes and that the pledgee is not the Issuer, any other
obligor upon the Notes or any Affiliate of the Issuer or of such other obligor.
Section 2.10. Temporary Notes.
Until Definitive Notes are ready for delivery, the Issuer may prepare and
the Trustee shall authenticate temporary Notes upon a written order of the
Issuer signed by an Officer of the Issuer. Temporary Notes shall be
substantially in the form of Definitive Notes but may have variations that the
Issuer considers appropriate for temporary Notes and as shall be reasonably
acceptable to the Trustee. Without unreasonable delay, the Issuer shall prepare
and the Trustee shall authenticate Definitive Notes in exchange for temporary
Notes.
Holders of temporary Notes shall be entitled to all of the benefits of this
Indenture.
Section 2.11. Cancellation.
The Issuer at any time may deliver Notes to the Trustee for cancellation.
The Registrar and Paying Agent shall forward to the Trustee any Notes
surrendered to them for registration of transfer, exchange or payment. The
Trustee and no one else shall cancel all Notes surrendered for registration of
transfer, exchange, payment, replacement or cancellation and shall destroy
cancelled Notes in accordance with its customary procedures. Certification of
destruction shall be delivered to the Issuer. The Issuer may not issue new Notes
to replace Notes that it has paid or that have been delivered to the Trustee for
cancellation.
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Section 2.12. Defaulted Interest.
If the Issuer defaults in a payment of interest on the Notes, it shall pay
the defaulted interest in any lawful manner plus, to the extent lawful, interest
payable on the defaulted interest, to the Persons who are Holders on a
subsequent special record date, in each case at the rate provided in the Notes
and in Section 4.01 hereof. The Issuer shall notify the Trustee in writing of
the amount of defaulted interest proposed to be paid on each Note and the date
of the proposed payment. The Issuer shall fix or cause to be fixed each such
special record date and payment date, provided that no such special record date
shall be less than 10 days prior to the related payment date for such defaulted
interest. At least 15 days before the special record date, the Issuer (or, upon
the written request of the Issuer, the Trustee in the name and at the expense of
the Issuer) shall mail or cause to be mailed to Holders a notice that states the
special record date, the related payment date and the amount of such interest to
be paid.
Section 2.13. Cusip Numbers.
The Issuer in issuing the Notes may use "CUSIP" numbers (if then generally
in use), and, if so, the Trustee shall use "CUSIP" numbers in notices of
redemption as a convenience to Holders; provided, however, that any such notice
may 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 and
that reliance may be placed only on the other identification numbers printed on
the Notes, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Issuer will promptly, and in any event within 10
Business Days, notify the Trustee of any change in the "CUSIP" numbers.
ARTICLE 3.
REDEMPTION
Section 3.01. Notices to Trustee.
If the Issuer elects to redeem Notes pursuant to the optional redemption
provisions of Section 3.07 hereof, the Issuer shall furnish to the Trustee, at
least 30 (or a lesser number acceptable to the Trustee) days but not more than
60 days before a redemption date, an Officers' Certificate setting forth (i) the
paragraph of the Notes and/or Section of this Indenture pursuant to which the
redemption shall occur, (ii) the redemption date, (iii) the principal amount of
Notes to be redeemed and (iv) the redemption price.
Section 3.02. Selection of Notes to Be Redeemed.
If less than all of the Notes are to be redeemed at any time, selection of
Notes for redemption will be made by the Trustee in compliance with the
requirements of the principal national securities exchange or trading system, if
any, on which the Notes are listed or accepted for trading, or, if the Notes are
not so listed or accepted for trading, on a pro rata basis, by lot or by such
method as the Trustee shall deem fair and appropriate and in accordance with
methods generally used at the time of selection by fiduciaries in similar
circumstances. If any Note is to be redeemed in part only, the notice of
redemption that relates to such Note shall state the portion of the principal
amount thereof to be redeemed. A new Note in principal amount equal to the
unredeemed portion thereof will be issued in the name of the Holder thereof upon
cancellation of
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the original Note. Notes called for redemption become due on the date fixed for
redemption. On and after the redemption date, interest ceases to accrue on Notes
or portions thereof called for redemption unless the Issuer defaults in making
such redemption payment.
The Trustee shall promptly notify the Issuer in writing of the Notes
selected for redemption and, in the case of any Note selected for partial
redemption, the principal amount thereof to be redeemed. Notes and portions of
Notes selected shall be in amounts of $1,000 or whole multiples of $1,000,
except that if all of the Notes of a Holder are to be redeemed, the entire
outstanding amount of Notes held by such Holder, even if not a multiple of
$1,000, shall be redeemed. Except as provided in the preceding sentence,
provisions of this Indenture that apply to Notes called for redemption also
apply to portions of Notes called for redemption.
Section 3.03. Notice of Redemption.
At least 30 days (except as otherwise provided in Section 3.09(a) hereof)
but not more than 60 days before a redemption date, the Issuer shall mail or
cause to be mailed, by first class mail, a notice of redemption to each Holder
whose Notes are to be redeemed at its registered address.
The notice shall identify the Notes to be redeemed (including CUSIP
numbers, if any) and shall state:
(a) the redemption date;
(b) the redemption price for the Notes and accrued and unpaid interest, if
any;
(c) if any Note is being redeemed in part, the portion of the principal
amount of such Note to be redeemed and that, after the redemption date upon
surrender of such Note, a new Note or Notes in principal amount equal to the
unredeemed portion shall be issued upon cancellation of the original Note;
(d) the name and address of the Paying Agent;
(e) that Notes called for redemption must be surrendered to the Paying
Agent to collect the redemption price;
(f) that, unless the Issuer defaults in making such redemption payment,
interest on Notes called for redemption ceases to accrue on and after the
redemption date;
(g) the paragraph of the Notes and/or Section of this Indenture pursuant to
which the Notes called for redemption are being redeemed; and
(h) the CUSIP number, if any, of the Notes called for redemption and that
no representation is made as to the correctness or accuracy of the CUSIP number,
if any, listed in such notice or printed on the Notes.
At the Issuer's written request, the Trustee shall give the notice of
redemption in the Issuer's name and at the Issuer's expense; provided, however,
that the Issuer shall have delivered
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to the Trustee, at least 45, or in the case of a redemption pursuant to Section
3.09 hereof, at least 10 (or, in either case, a lesser number acceptable to the
Trustee) days prior to the redemption date, an Officers' Certificate requesting
that the Trustee give such notice and setting forth the information in such
notice required by the preceding paragraph.
Section 3.04. Effect of Notice of Redemption.
Once notice of redemption is mailed in accordance with Section 3.03 hereof,
Notes called for redemption become irrevocably due and payable on the redemption
date at the redemption price plus accrued and unpaid interest to such date. A
notice of redemption may not be conditional. Upon surrender to the Paying Agent
of any of the Notes called for redemption, those Notes shall be paid on the
redemption date at the redemption price, together with accrued and unpaid
interest to such date.
Section 3.05. Deposit of Redemption Price.
On or prior to 10:00 a.m. (New York City time) on the redemption date, the
Issuer shall deposit with the Trustee or with the Paying Agent money sufficient
to pay the redemption price of and accrued and unpaid interest on all Notes to
be redeemed on that date. The Trustee or the Paying Agent shall promptly return
to the Issuer any money deposited with the Trustee or the Paying Agent by the
Issuer in excess of the amounts necessary to pay the redemption price of, and
accrued and unpaid interest on, all Notes to be redeemed.
If the Issuer complies with the provisions of the preceding paragraph, on
and after the redemption date, interest shall cease to accrue on the Notes or
the portions of Notes called for redemption. If a Note is redeemed on or after
an interest record date but on or prior to the related interest payment date,
then any accrued and unpaid interest shall be paid to the Person in whose name
such Note was registered at the close of business on such record date. If any
Note called for redemption shall not be so paid upon surrender for redemption
because of the failure of the Issuer to comply with the preceding paragraph,
interest shall be paid on the unpaid principal, from the redemption date until
such principal is paid, and to the extent lawful on any interest not paid on
such unpaid principal, in each case at the rate provided in the Notes and in
Section 4.01 hereof.
Unless the Issuer shall default in the payment of Notes (and accrued and
unpaid interest) called for redemption, interest on such Notes shall cease to
accrue after the redemption date.
Section 3.06. Notes Redeemed in Part.
Upon surrender of a Note that is redeemed in part, the Issuer shall issue
and, upon receipt of a written order signed by an Officer of the Issuer, the
Trustee shall authenticate for the Holder at the expense of the Issuer, a new
Note equal in principal amount to the unredeemed portion of the Note
surrendered.
Section 3.07. Optional Redemption.
(a) Except as set forth in subsection (b) of this Section 3.07, the Notes
shall not be redeemable at the Issuer's option prior to April 30, 2007.
Thereafter, the Notes shall be
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redeemable at the option of the Issuer, in whole at any time or in part from
time to time, upon not less than 30 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest thereon, if any, to the applicable redemption
date, if redeemed during the twelve-month period beginning on April 30 of the
years indicated below:
YEAR PERCENTAGE
2007 ..................................................................103.50%
2008...................................................................101.75%
2009 and thereafter ...................................................100.00%
(b) Notwithstanding subsection (a) of this Section 3.07, at any time within
75 days after the date as of which the Issuer has knowledge of the occurrence of
a Change of Control, the Issuer may, but shall in no event be required to,
redeem 100% but not less than 100% of the outstanding Notes at a redemption
price equal to 101% of the principal amount of the Notes, plus accrued and
unpaid interest thereon, if any, to the redemption date.
(c) Any redemption pursuant to this Section 3.07 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 hereof.
Section 3.08. Mandatory Redemption Out of Excess Cash Flow.
(a) The Notes are subject to mandatory redemption by the Issuer on April 30
and October 31 of each year (or, if financial statements for the period ended on
the preceding December 31 or June 30, as the case may be, have not been provided
to the Trustee pursuant to Section 4.03 hereof, on the date that is 30 days
after the date of delivery of such financial statements), with the first such
payment to be made on April 30, 2005, out of Excess Cash Flow at a redemption
price equal to 100% of the principal amount of the Notes to be redeemed, plus
accrued and unpaid interest, if any, thereon to the redemption date.
Notwithstanding the foregoing, the Issuer shall not be required to redeem Notes
pursuant to this Section 3.08 on any such date out of Excess Cash Flow that is
less than $1,000,000. Any redemption of Notes pursuant to this Section 3.08
shall be made on a pro rata basis (based on principal amounts outstanding) with
any redemption of Tranche A Notes then required to be made pursuant to Section
3.08 of the Tranche A Indenture.
(b) Any redemption pursuant to this Section 3.08 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 hereof.
Section 3.09. Mandatory Redemption Out of Net Proceeds of Principal Asset Sales.
(a) The Notes are subject to mandatory redemption by the Issuer within 30
days after the receipt by the Issuer of Net Proceeds from any Principal Asset
Sale, after application of such Net Proceeds first to the payment of any unpaid
fees and expenses of the Collateral Agent under the Intercreditor Agreement and
then to the payment of all amounts then required to be paid pursuant to any New
Credit Facility (but without being required hereby to effect a permanent
reduction of the commitment under such facility), second to fund Cash on Hand
and third to the payment of any unpaid fees and expenses of the Trustee
hereunder. The Notes shall be so
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redeemed upon not less than 10 nor more than 20 days' notice at a redemption
price equal to the principal amount thereof to be redeemed, plus accrued and
unpaid interest thereon, if any, to the redemption date. Notwithstanding the
foregoing provisions, (i) if the Issuer receives Net Proceeds from a Principal
Asset Sale on or prior to the Initial Distribution Date (as such term is defined
in the Plan), the date by which the redemption required hereby as a result of
the receipt of such Net Proceeds shall occur shall be 30 days after such receipt
or, if later, the date that is 15 days after the Initial Distribution Date; (ii)
the Issuer shall not be required to redeem Notes pursuant to this Section 3.09
unless it has theretofore redeemed, or redeems concurrently with a redemption of
Notes pursuant to this Section 3.09, all of the outstanding Tranche A Notes
pursuant to and in accordance with the provisions of Section 3.09 of the Tranche
A Indenture; and (iii) the Issuer shall not be required to redeem Notes pursuant
to this Section 3.09 out of Net Proceeds of any Principal Asset Sale (except
following the final distribution of such Net Proceeds) that are received
subsequent to the initial receipt of Net Proceeds from such Asset Sale unless
such subsequently received Net Proceeds, together with all other Net Proceeds
not theretofore applied pursuant to this Section 3.09, exceed $1,000,000.
(b) Any redemption pursuant to this Section 3.09 shall be made pursuant to
the provisions of Sections 3.01 through 3.06 hereof (except, in the case of
Sections 3.01 and 3.03 with respect to notice of redemption, as otherwise
provided in subsection (a) of this Section 3.09).
(c) The Issuer shall not be required to make mandatory redemption payments
(except pursuant to Section 3.08 hereof or this Section 3.09) or sinking fund
payments with respect to the Notes.
Section 3.10. Offer to Purchase Notes.
If the Issuer shall be required to commence an offer to all Holders to
purchase Notes (a "Purchase Offer") pursuant to Section 4.15 hereof, the Issuer
shall follow the procedures specified below.
The Purchase Offer shall remain open for a period of 20 Business Days
following its commencement (the "Offer Period"). No later than five Business
Days after the termination of the Offer Period (the "Purchase Date"), the Issuer
shall purchase all Notes tendered in response to the Purchase Offer. Payment for
any Notes so purchased shall be made in the same manner as interest payments are
made.
If the Purchase Date is on or after an interest record date and on or
before the related interest payment date, any accrued and unpaid interest on the
Notes shall be paid to the Persons in whose names the Notes are registered at
the close of business on such record date, and no additional interest shall be
payable to Holders who tender Notes pursuant to the Purchase Offer.
Upon the commencement of a Purchase Offer, the Issuer shall send, by first
class mail, a notice thereof to each of the Holders, with a copy to the Trustee.
The notice shall contain all instructions and materials necessary to enable such
Holders to tender Notes pursuant to the Purchase Offer. The Purchase Offer shall
be made to all Holders. The notice, which shall govern the terms of the Purchase
Offer, shall state:
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(a) that the Purchase Offer is being made pursuant to this Section 3.10 and
Section 4.15 hereof and the length of time the Purchase Offer shall remain open;
(b) the purchase price and the Purchase Date;
(c) that any Note not tendered or accepted for payment shall continue to
accrue interest;
(d) that, unless the Issuer defaults in making such payment, any Note
accepted for payment pursuant to the Purchase Offer shall cease to accrue
interest on and after the Purchase Date;
(e) that Holders electing to have Notes purchased pursuant to such Purchase
Offer shall be required to surrender such Notes, with the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Notes duly completed, or
transfer by book-entry transfer to the Issuer, a depository, if appointed by the
Issuer, or a Paying Agent at the address specified in the notice prior to the
expiration of the Offer Period;
(f) that Holders shall be entitled to withdraw their election if the
Issuer, the depository or the Paying Agent, as the case may be, receives, not
later than the expiration of the Offer Period, a facsimile transmission or
letter setting forth the name of the Holder, the principal amount of the Note or
Notes the Holder delivered for purchase, the certificate number (in the case of
a Definitive Note) and a statement that such Holder is withdrawing such ▇▇▇▇▇▇'s
election to have such Note or Notes purchased;
(g) that Holders whose Notes were purchased only in part shall be issued
new Notes equal in principal amount to the unpurchased portion of the Notes
surrendered (or transferred by book-entry transfer); and
(h) that the Purchase Offer may terminate if the Issuer elects to redeem
the Notes in accordance with the provisions of Section 3.07(b) of the Indenture.
If the Issuer is required to purchase Notes pursuant to the Purchase Offer:
(i) on or prior to 10:00 a.m. (New York City time) on the Purchase
Date, the Issuer shall irrevocably deposit with the Trustee or the Paying Agent
in immediately available funds the principal amount of the Notes delivered prior
to the expiration of the Offer Period, together with accrued and unpaid interest
thereon (to the extent then required to be paid), to be held for payment in
accordance with the terms of this Section 3.10; and
(ii) on the Purchase Date, the Issuer shall, to the extent lawful, (x)
accept for payment the Notes tendered pursuant to the Purchase Offer, (y)
deliver or cause the Paying Agent or depository, as the case may be, to deliver
to the Trustee Notes so accepted and (z) deliver to the Trustee an Officers'
Certificate stating that such Notes were accepted for payment by the Issuer in
accordance with the terms of this Section 3.10.
If the Issuer is required to purchase Notes pursuant to the Purchase Offer,
the Issuer, the Trustee or the Paying Agent, as the case may be, shall promptly
(but in any case not later than
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three Business Days after the Purchase Date) mail or deliver to each tendering
Holder an amount equal to the purchase price of the Notes tendered by such
Holder and accepted by the Issuer for purchase, plus any accrued and unpaid
interest thereon (to the extent then required to be paid), and the Issuer shall
promptly issue a new Note, and the Trustee shall authenticate and mail or
deliver such new Note to such Holder, equal in principal amount to any
unpurchased portion of such Holder's Note or Notes surrendered. Any Note not so
accepted shall be promptly mailed or delivered by the Issuer to the Holder
thereof. The Issuer shall publicly announce in a newspaper of general
circulation or in a press release provided to a nationally recognized financial
wire service the results of the Purchase Offer.
ARTICLE 4.
COVENANTS
Section 4.01. Payment of Notes.
The Issuer shall pay or cause to be paid the principal of, premium, if any,
and interest on the Notes on the dates and in the manner provided in this
Indenture and in the Notes. Principal, premium, if any, and interest shall be
considered paid on the date due if the Paying Agent, if other than the Issuer or
a Subsidiary, holds as of 10:00 a.m. (New York City time) on the due date money
deposited by the Issuer in immediately available funds (or, to the extent
permitted by Section 2.02(b) hereof, Secondary Notes) and designated for and
sufficient to pay all principal, premium, if any, and interest then due.
The Issuer shall pay interest on overdue principal at the rate equal to 2%
per annum in excess of the then applicable interest rate on the Notes to the
extent lawful; it shall pay interest on overdue installments of interest
(without regard to any applicable grace period) at the same rate to the extent
lawful.
Section 4.02. Maintenance of Office or Agency.
The Issuer shall maintain in the Borough of Manhattan, The City of New
York, an office or agency (which may be an office of the Trustee or an affiliate
of the Trustee or of the Registrar or co-registrar) where Notes may be
surrendered for registration of transfer or for exchange and where notices and
demands to or upon the Issuer in respect of the Notes and this Indenture may be
served. The Issuer 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 Issuer shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the Corporate Trust
Office of the Trustee.
The Issuer 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, however,
that no such designation or rescission shall in any manner relieve the Issuer of
its obligation to maintain an office or agency in the Borough of Manhattan, The
City of New York, for such purposes. The Issuer 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.
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The Issuer hereby designates the Corporate Trust Office of the Trustee as
one such office or agency of the Issuer in accordance with Section 2.03 hereof.
Section 4.03. Reports.
Whether or not required by the rules and regulations of the Commission, so
long as any of the Notes are outstanding, the Issuer shall furnish to the
Trustee, within 15 days of the last day of the time period specified in the
Commission's rules and regulations for filing such report, all quarterly and
annual financial statements and financial information that would be required to
be contained in a report filed with the Commission on Form 10-Q or Form 10-K, as
the case may be, if the Issuer were required to file such reports, including a
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" that describes the financial condition and results of operations of
the Issuer and its Consolidated Subsidiaries, beginning with financial
statements and information as at the end of and for the quarter ending September
30, 2004, and, with respect to annual information only, a report thereon by the
Issuer's independent auditors. The Trustee will provide, at the Issuer's
expense, copies of any such documents to any Holders that request such copies.
The Issuer will also comply with the other provisions of TIA Section 314(a).
The receipt by the Trustee of any such reports or statements pursuant to
this Section 4.03 shall not constitute notice or constructive notice of any
information contained in such reports or statements or determinable from
information contained in such reports or statements, including the Issuer's
compliance with any covenants hereunder (as to which, except for covenants to
make payments on or in respect of the Notes, the Trustee is entitled to rely
exclusively on an Officers' Certificate).
Section 4.04. Compliance Certificate.
(a) The Issuer shall, so long as any of the Notes are outstanding, deliver
to the Trustee, within 120 days after the end of each fiscal year of the Issuer,
an Officers' Certificate (which need not comply with Section 11.05 hereof)
stating that a review of the activities of the Issuer and its Subsidiaries
during the preceding fiscal year has been made under the supervision of the
signing Officers (one of whom shall be the principal executive officer,
principal financial officer or principal accounting officer of the Issuer) with
a view to determining whether the Issuer has kept, observed, performed and
fulfilled its obligations under this Indenture and further stating, as to each
Officer signing such certificate, that to the best of his or her knowledge the
Issuer has kept, observed, performed and fulfilled such obligations and is not
in default in the performance or observance of any of the terms, provisions or
conditions of this Indenture (or, if a Default or Event of Default shall have
occurred, describing all such Defaults or Events of Default of which he or she
may have knowledge and what action, if any, the Issuer is taking or proposes to
take with respect thereto).
(b) The Issuer shall, so long as any of the Notes are outstanding, deliver
to the Trustee, forthwith upon any Officer becoming aware of any Default or
Event of Default, an Officers' Certificate specifying such Default or Event of
Default and what action, if any, the Issuer is taking or proposes to take with
respect thereto.
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Section 4.05. Taxes.
The Issuer shall pay, and shall cause each of its Subsidiaries to pay,
prior to delinquency, all material taxes, assessments and governmental levies,
except such as are contested in good faith and by appropriate proceedings or
where the failure to effect such payment is not adverse in any material respect
to the Holders of the Notes.
Section 4.06. Stay, Extension and Usury Laws.
The Issuer covenants (to the extent that it may lawfully do so) that it
shall not at any time insist upon, plead or in any manner whatsoever claim or
take the benefit or advantage of any stay, extension or usury law wherever
enacted, now or at any time hereafter in force, that would reasonably be
expected to affect the covenants or the performance by the Issuer of this
Indenture; and the Issuer (to the extent that it may lawfully do so) hereby
expressly waives all benefit or advantage of any such law and covenants that it
shall not, by resort to any such law, hinder, delay or impede the execution of
any power herein granted to the Trustee, but shall suffer and permit the
execution of every such power as though no such law had been enacted.
Section 4.07. Dividends; Restricted Investments.
(a) The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, (i) in the case of the Issuer, declare
or pay any dividend, or in the case of the Issuer or any of its Restricted
Subsidiaries, make any other payment or distribution on account of the Issuer's
Equity Interests or to the direct or indirect holders of the Issuer's Equity
Interests in their capacity as such (other than dividends or distributions
payable in additional Equity Interests (other than Disqualified Stock) of the
Issuer), (ii) purchase, redeem or otherwise acquire or retire for value
(including, without limitation, in connection with any merger or consolidation
involving the Issuer) any Equity Interests of the Issuer, except for purchases
and acquisitions referred to in any of items (i), (ii) and (iii) of subsection
(c) below, or (iii) make any payment on or with respect to, or purchase, redeem,
defease or otherwise acquire or retire for value, any Indebtedness of the Issuer
that is subordinated to the Notes (provided that the Notes shall not be deemed
to be subordinated for this purpose), except a payment of principal or interest
at Stated Maturity.
(b) The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, make any Restricted Investment unless
at the time of and after giving effect to such Restricted Investment:
(1) no Default or Event of Default shall have occurred and be
continuing or would occur as a consequence thereof; and
(2) such Restricted Investment, together with the aggregate amount of
all other Restricted Investment made by the Issuer and its Restricted
Subsidiaries during the same fiscal year (excluding Restricted Investments
permitted by any of the clauses contained in subsection (c) below), is less
than the sum of (x) $5 million and (y) to the extent that any Restricted
Investment that was made after the date of this Indenture is sold for cash
or otherwise liquidated or repaid for cash, the aggregate amount received
in cash with respect thereto (less the cost of disposition, if any),
including, without
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limitation, any cash dividends or distributions, and any cash dividends or
distributions received from any Unrestricted Subsidiary.
(c) The foregoing provisions shall not prohibit (i) the redemption,
repurchase, retirement, defeasance or other acquisition of any subordinated
Indebtedness or Equity Interests of the Issuer in exchange for, or out of the
net cash proceeds of, the substantially concurrent sale or issuance (other than
to a Restricted Subsidiary of the Issuer) of Equity Interests of the Issuer or
any Restricted Subsidiary (other than any Disqualified Stock); (ii) the
repurchase, redemption or other acquisition or retirement for value of any
Equity Interests of the Issuer or any Restricted Subsidiary of the Issuer held
by any employee of the Issuer (or any of its Restricted Subsidiaries) pursuant
to any equity subscription agreement, stock option agreement or similar plan or
agreement adopted or approved by the Board of Directors (provided that the
aggregate price paid for all such repurchased, redeemed, acquired or retired
Equity Interests shall not exceed $5 million in any twelve-month period and no
Default or Event of Default shall have occurred and be continuing immediately
after such transaction) or upon the termination of such person's employment;
(iii) the acquisition by the Issuer or any of its Restricted Subsidiaries of
shares of common stock of the Issuer pursuant to any odd-lot tender offer or
other program for the reduction of holdings of less than 1,000 shares of common
stock; (iv) Investments received by the Issuer or any of its Restricted
Subsidiaries as non-cash consideration from Asset Sales to the extent permitted
by Section 4.10 hereof; or (v) any payments made pursuant to, or transactions
contemplated by, the Plan, including payments to be made to the Issuer to allow
the Issuer to make distributions to creditors or other claimants.
(d) The Board of Directors may designate any Restricted Subsidiary (other
than any GTN Entity or IPP Entity) to be an Unrestricted Subsidiary if such
designation would not cause a Default. For purposes of making such
determination, all outstanding Investments by the Issuer and its Restricted
Subsidiaries (except to the extent repaid in cash) in the Subsidiary so
designated shall be deemed to be Restricted Investments at the time of such
designation and shall be included for purposes of calculating the aggregate
amount of Restricted Investments under clause (3) of subsection (b) above. All
such outstanding Investments shall be deemed to constitute Investments in an
amount equal to the fair market value of such Investments at the time of such
designation. Such designation shall only be permitted if such Restricted
Investment would be permitted at such time and if such Restricted Subsidiary
otherwise meets the definition of an Unrestricted Subsidiary.
(e) The amount of any Restricted Investment (other than cash) shall be the
fair market value on the date of the Restricted Investment of the asset(s) or
securities proposed to be transferred or issued by the Issuer or such Restricted
Subsidiary, as the case may be, pursuant to the Restricted Investment. The fair
market value of any individual or series of related non-cash Restricted
Investments (other than in the Reorganization) shall be determined by the Board
of Directors, whose resolution with respect thereto shall be delivered to the
Trustee. In connection with each Restricted Investment, the Issuer shall deliver
to the Trustee, prior to or within 60 days of the making of such Restricted
Investment, an Officers' Certificate stating that such Restricted Investment is
permitted under this Indenture and setting forth the basis upon which the
calculations required by this Section 4.07 were computed.
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Section 4.08. Dividend and Other Payment Restrictions Affecting Subsidiaries.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create or otherwise cause to exist or
become effective after the date of this Indenture any encumbrance or restriction
on the ability of any Restricted Subsidiary to (i)(a) pay dividends or make any
other distributions to the Issuer or any of its Restricted Subsidiaries on its
Capital Stock or (b) pay any indebtedness owed to the Issuer or any of its
Restricted Subsidiaries, (ii) make loans or advances to the Issuer or any of its
Restricted Subsidiaries or (iii) transfer any of its properties or assets to the
Issuer or any of its Restricted Subsidiaries, except for such encumbrances or
restrictions existing under or by reason of (a) Existing Indebtedness, (b) any
New Credit Facility (provided that any such restrictions contained therein are
substantially no more restrictive when taken as a whole that those contained in
this Indenture), (c) this Indenture and the Notes or the Tranche A Indenture and
the Tranche A Notes, (d) applicable law, (e) any instrument governing
Indebtedness or Capital Stock of a Person acquired by the Issuer or any of its
Restricted Subsidiaries as in effect at the time of such acquisition (except to
the extent that such Indebtedness was incurred in connection with or in
contemplation of such acquisition), which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person, other than
the Person and its Subsidiaries, or the property or assets of the Person and its
Subsidiaries, so acquired, (f) customary non-assignment or net worth provisions,
and other customary provisions, in leases or licenses entered into in the
ordinary course of business, (g) purchase money obligations for property
acquired that impose restrictions of the nature described in clause (iii) above
on the property so acquired, (h) Permitted Refinancing Indebtedness, provided
that the restrictions contained in the agreements governing such Permitted
Refinancing Indebtedness are substantially no more restrictive when taken as a
whole than those contained in the agreements governing the Indebtedness being
refinanced, (i) Indebtedness incurred pursuant to item (xii) of the second
paragraph of Section 4.09 hereof, (j) any instrument or agreement governing
Indebtedness permitted to be incurred under this Indenture, which is secured by
a Lien permitted to be incurred under this Indenture, (k) any instrument or
agreement governing Indebtedness or obligations of a Restricted Subsidiary to
the extent that the Board of Directors determines that such encumbrances or
restrictions generally protect or enhance the ability of such Subsidiary to make
funds available to the Issuer, (l) IPP Sale Agreements and other contracts for
Asset Sales or other sales of assets or Equity Interests, including, without
limitation, customary restrictions with respect to a Restricted Subsidiary with
respect to the issuance pursuant to an agreement that has been entered into for
the sale or disposition of all or substantially all of the Capital Stock or
assets of such Restricted Subsidiary (m) any agreement between GTN and holders
of its 6.62% Senior Notes due 2012, provided that such restrictions terminate
upon any sale or transfer of all or substantially all of the common stock or
assets of GTN, or (n) customary provisions in joint venture agreements or other
similar agreements.
Section 4.09. Incurrence of Indebtedness.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, issue, assume, guaranty
or otherwise become directly or indirectly liable, contingently or otherwise,
with respect to (collectively "incur") any Indebtedness, and the Issuer shall
not, and shall not permit any of its Restricted Subsidiaries to, issue any
Disqualified Stock; provided, however, that the Issuer and its Restricted
Subsidiaries may incur Indebtedness (and
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such Indebtedness may be incurred pursuant to this paragraph without regard, in
the case of any particular category of Indebtedness, to any limitation set forth
with respect to Indebtedness of such category in any of items (i) through
(xviii) set forth below in this Section 4.09) or issue shares of Disqualified
Stock if:
(i) no Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such incurrence or
issuance; and
(ii) after giving effect to such incurrence or issuance, the Ratio of
Cash Flow to Fixed Charges of the Issuer would not be less than 1.5:1
(calculated on a pro forma basis to include such Indebtedness and related
cash flows as of the end of the most recent fiscal quarter of the Issuer
with respect to which financial statements of the Issuer have been
furnished to the Trustee pursuant to Section 4.03 hereof.)
The provisions of the first paragraph of this Section 4.09 will not apply
to the incurrence of any of the following items of Indebtedness (collectively
"Permitted Debt"):
(i) the incurrence by the Issuer or any of its Restricted Subsidiaries
of Indebtedness under one or more New Credit Facilities, and the issuance
of letters of credit thereunder from time to time, in an aggregate
principal or stated amount outstanding at any time not to exceed $60
million;
(ii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of Existing Indebtedness;
(iii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of Indebtedness pursuant to the terms and provisions, or in
connection with the implementation, of the Plan;
(iv) the incurrence by the Issuer of Indebtedness represented by the
Notes and the Tranche A Notes;
(v) the incurrence of Non-Recourse Debt by any Operating Company or
Investment Vehicle;
(vi) Permitted Sale/Leaseback Transactions;
(vii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of Lease Obligations under leases for equipment or other
personal property not to exceed $10 million in aggregate principal or
stated amount outstanding at any time;
(viii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of Permitted Refinancing Indebtedness;
(ix) Indebtedness incurred by the Issuer or any of its Restricted
Subsidiaries in respect of surety bonds, performance or bid bonds or
letters of credit issued in the ordinary course of business, including,
without limitation, those in respect of workers'
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compensation claims or self-insurance, in an aggregate amount outstanding
at any time not to exceed $25 million;
(x) the incurrence by the Issuer or any of its Restricted Subsidiaries
of intercompany Indebtedness between or among the Issuer and any of its
Restricted Subsidiaries (subject to the provisions of clauses (i) and (ii)
of item (a) of the definition of the term "Permitted Investments" herein),
provided that such Indebtedness is expressly subordinated to the prior
payment in full in cash of all Obligations with respect to the Notes;
(xi) the Guaranty by the Issuer or any of its Restricted Subsidiaries
of Indebtedness of the Issuer or a Restricted Subsidiary of the Issuer
(other than a Guaranty by the Issuer of Indebtedness of an Operating
Company or an Investment Vehicle or a Guaranty by a Restricted Subsidiary
of Indebtedness of an Operating Company or an Investment Vehicle that is
not a member of the same Operating Company Group as the guaranteeing
Subsidiary) that was permitted by this Indenture to be incurred;
(xii) Indebtedness of any Restricted Subsidiary of the Issuer existing
at the time such Person becomes a Restricted Subsidiary of the Issuer
(except for any such Indebtedness incurred in contemplation of or to
finance the acquisition of such Subsidiary);
(xiii) Indebtedness under any Swap;
(xiv) the incurrence by the Issuer or any of its Restricted
Subsidiaries of Indebtedness under short-term overdraft lines of credit or
similar arrangements entered into in the ordinary course of business, in
each case associated with the Issuer's cash management program;
(xv) the incurrence by Service Companies of Indebtedness in respect of
credit card obligations or services incurred in the ordinary course of
business;
(xvi) the incurrence by an IPP Entity, or by any other Restricted
Subsidiary of the Issuer that is the seller of Equity Interests of any such
IPP Entity, in each case pursuant to or in connection with an IPP Sale
Agreement, of Indebtedness which the Board of Directors has determined is
necessary or appropriate for the purpose of effectuating such Asset Sale;
(xvii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of Indebtedness to finance insurance premiums; and
(xviii) the incurrence by the Issuer or any of its Restricted
Subsidiaries of additional Indebtedness, in an aggregate principal amount
(or accreted value, if applicable) at any time outstanding not to exceed $5
million.
For purposes of determining compliance with this Section 4.09, if an item
of Indebtedness meets the criteria of more than one of the categories of
Permitted Debt described in clauses (i) through (xviii) above or is entitled to
be incurred pursuant to the first paragraph of this
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Section 4.09, the Issuer may, in its sole discretion, classify such item of
Indebtedness in any manner that complies with this Section 4.09, and such item
of Indebtedness will be treated as having been incurred pursuant to one or more
of such clauses and/or pursuant to the first paragraph hereof in accordance with
such classification. Neither the accrual of interest, nor the accretion of
accreted value, will be deemed to be an incurrence of Indebtedness for purposes
of this Section 4.09.
Section 4.10. Asset Sales.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, consummate an Asset Sale unless (i) the Issuer (or the
Restricted Subsidiary, as the case may be) receives consideration at the time of
such Asset Sale at least equal to the fair market value (evidenced by an
Officers' Certificate delivered to the Trustee and a Board Resolution) of the
assets or Equity Interests issued or sold or otherwise disposed of, (ii) at
least 75% of the consideration therefor received by the Issuer or such
Restricted Subsidiary is in the form of (A) cash, (B) assets useful in a
Permitted Business not to exceed $10 million in the aggregate over the life of
the Notes and/or (C) Equity Interests representing a controlling interest in a
Permitted Business not to exceed $10 million in the aggregate over the life of
the Notes (collectively the "Permitted Consideration"); provided that the amount
of (x) any liabilities (as shown on the Issuer's or such Restricted Subsidiary's
most recent balance sheet) of the Issuer or any Restricted Subsidiary as of the
date prior to the date of consummation of such transaction that are assumed by
the transferee of any such assets and (y) any securities, notes or other
obligations received by the Issuer or any such Restricted Subsidiary from such
transferee that are convertible within 90 days by the Issuer or such Restricted
Subsidiary into Permitted Consideration, shall be deemed to be Permitted
Consideration for purposes of this provision; and provided further, that the 75%
limitation referred to above shall not apply to any Asset Sale in which the
Permitted Consideration portion of the consideration received therefor is equal
to or greater than what the net after-tax proceeds would have been had such
Asset Sale complied with the aforementioned 75% limitation and (iii) the Net
Proceeds of such Asset Sale are applied, or set aside for application, pursuant
to, and as and to the extent required by, Section 3.09 hereof or the last
paragraph of this Section 4.10, as the case may be.
Pending application of Net Proceeds from an Asset Sale pursuant to Section
3.09 hereof or the last paragraph of this Section 4.10, as the case may be, the
Issuer may apply such Net Proceeds, at its option, (a) to repay Indebtedness
outstanding under any New Credit Facility (but without being required hereby to
effect a permanent reduction of the commitment under such facility) or (b) to
Permitted Investments.
The Issuer shall use commercially reasonably efforts to direct the seller
pursuant to each Principal Asset Sale to transfer or cause to be transferred the
Net Proceeds of such Principal Asset Sale to the Issuer.
During the period ending on the first anniversary of the date of this
Indenture, the Issuer shall deliver, or cause to be delivered, within 30 days
after its receipt thereof from time to time, Net Proceeds of any Asset Sale that
is not a Principal Asset Sale to the disbursing agent of the Issuer pursuant to
the Plan, for distribution to Class 3 claimants in accordance with the
provisions of the Plan.
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Section 4.11. Transactions with Affiliates.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, make any payment to, or sell, lease,
transfer or otherwise dispose of any of its properties or assets to, or purchase
any property or assets from, or enter into or make or amend any transaction,
contract, agreement, understanding, loan, advance or Guaranty with, or for the
benefit of, any Affiliate (each of the foregoing, an "Affiliate Transaction"),
unless (i) such Affiliate Transaction is set forth in writing and is on terms
that are no less favorable to the Issuer or the relevant Restricted Subsidiary
than those that would have been obtained in a comparable transaction by the
Issuer or such Subsidiary with an unrelated Person and (ii) the Issuer delivers
to the Trustee (a) with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate consideration of at least $5
million but less than $10 million, a resolution of the Board of Directors set
forth in an Officers' Certificate certifying that such Affiliate Transaction
complies with clause (i) above and that such Affiliate Transaction has been
approved by a majority of the members of the Board of Directors and (b) with
respect to any Affiliate Transaction or series of related Affiliate Transactions
involving aggregate consideration of $10 million or more, an opinion as to the
fairness to the Holders of such Affiliate Transaction from a financial point of
view issued by an accounting, appraisal or investment banking firm of national
standing; provided that the following shall not be deemed Affiliate
Transactions:
(i) prepaid expenses and loans or advances to employees and similar
items in the ordinary course of business;
(ii) purchases (and sales) of inventory and services in the ordinary
course of business on terms that are customary in the industry or
consistent with past practices;
(iii) fees, compensation or employee benefit arrangements (including
any grants of securities under stock option or similar plans or other
employee benefit plans) paid to, and indemnity provided for and on behalf
of, directors, officers or employees of the Issuer or any Subsidiary of the
Issuer after the date of this Indenture;
(iv) transactions pursuant to agreements or arrangements in effect on
the date of this Indenture, including amendments thereto after such date,
provided that the terms of any such amendment are not, in the aggregate,
less favorable to the Issuer or any Restricted Subsidiary, as applicable,
than the terms of such agreement prior to such amendment;
(v) any employment agreement (including customary benefits thereunder)
entered into by the Issuer or any of its Subsidiaries in the ordinary
course of business and consistent with the current market practice or the
past practice of the Issuer or such Subsidiary;
(vi) transactions between or among the Issuer and/or its Restricted
Subsidiaries;
(vii) tax sharing agreements or arrangements (including tax
settlements) between or among the Issuer and one or more Restricted
Subsidiaries, on the one hand, and one or more Unrestricted Subsidiaries or
other Affiliates, on the other hand, provided
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that any such agreement or arrangement shall have been approved by the
Board of Directors;
(viii) Restricted Investments that are permitted by the provisions of
Section 4.07 hereof; and
(ix) transactions contemplated by the Plan or the related Disclosure
Statement, including, without limitation, transactions with the Litigation
Trust provided for in the Plan.
Section 4.12. Liens.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, directly or indirectly, create, incur, assume or suffer to
exist or become effective any Lien on any asset now owned or hereafter acquired
by the Issuer or that Restricted Subsidiary, or any income or profits therefrom
or assign or convey any right to receive income therefrom, except Permitted
Liens.
Section 4.13. Line of Business.
The Issuer shall not, and shall not permit any of its Restricted
Subsidiaries to, engage in any business other than Permitted Businesses, except
to such extent as would not be material to the Issuer and its Restricted
Subsidiaries taken as a whole.
Section 4.14. Corporate Existence.
Subject to Article 5 hereof, the Issuer shall do or cause to be done all
things necessary to preserve and keep in full force and effect (i) its corporate
existence, and the corporate, partnership or other existence of each of the
Restricted Subsidiaries, in accordance with the respective organizational
documents (as the same may be amended from time to time) of the Issuer or any
such Restricted Subsidiary and (ii) the rights (charter and statutory), licenses
and franchises of the Issuer and its Restricted Subsidiaries; provided, however,
that the Issuer shall not be required to preserve any such right, license or
franchise, or the corporate, partnership or other existence of any of its
Restricted Subsidiaries, if either (i) the Issuer shall determine that the
preservation thereof is no longer desirable in the conduct of the business of
the Issuer and its Restricted Subsidiaries, taken as a whole, and that the loss
thereof is not adverse in any material respect to the Holders of the Notes; or
(ii) the Plan provided for the termination, dissolution, abandonment or disposal
thereof.
Section 4.15. Offer to Purchase upon a Change of Control.
Upon the occurrence of a Change of Control of which the Issuer has
knowledge, each Holder shall have the right to require the Issuer to purchase
all or any part (equal to $1,000 or an integral multiple thereof) of such
Holder's Notes pursuant to the offer described below (the "Change of Control
Offer") at an offer price in cash equal to 101% of the aggregate principal
amount thereof to the date of purchase. Within 30 days after the date as of
which the Issuer has knowledge of the occurrence of a Change of Control, the
Issuer shall mail a notice to each Holder describing the transaction or
transactions that constituted the Change of Control and offering to purchase
Notes on the date specified in such notice, which notice shall comply with
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Section 3.10 hereof. The Issuer shall comply with the requirements of 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 connection with the
purchase of the Notes as a result of the Change of Control.
Notwithstanding the foregoing provisions, the Issuer shall not be required
(i) to make a Change of Control Offer if prior to the date as of which the
Issuer would otherwise be required to mail such notice the Issuer has given or
caused to be given a notice of redemption of the Notes pursuant to Section
3.07(b) hereof or (ii) to purchase Notes pursuant to any such notice of a Change
of Control Offer if the Issuer shall redeem the Notes pursuant to such Section.
The Change of Control provisions described in this Section 4.15 shall be
applicable notwithstanding any other provisions of this Indenture, other than
Section 3.10 hereof, which Section 3.10 shall govern the procedures used in
connection with a Change of Control Offer.
The Issuer shall not be required to make a Change of Control Offer upon a
Change of Control if a third party makes the Change of Control Offer in the
manner, at the times and otherwise in compliance with the requirements set forth
in this Indenture applicable to a Change of Control Offer made by the Issuer and
purchases all Notes validly tendered and not withdrawn under such Change of
Control Offer.
Section 4.16. Limitation on Issuances and Sales of Capital Stock of Restricted
Subsidiaries.
The Issuer (i) shall not, and shall not permit any Restricted Subsidiary of
the Issuer to, transfer, convey, sell, lease or otherwise dispose of any Capital
Stock of any Restricted Subsidiary of the Issuer to any Person (other than the
Issuer or a Restricted Subsidiary of the Issuer), unless (a) such transfer,
conveyance, sale, lease or other disposition is of all the Capital Stock of such
Restricted Subsidiary (provided that minority interests in any such Capital
Stock may be retained if necessary, in the determination of the Board of
Directors, to facilitate such transfer, conveyance, sale, lease or other
disposition), and (b) the cash Net Proceeds from such transfer, conveyance,
sale, lease or other disposition are applied in accordance with any applicable
provisions of Section 3.09 or Section 4.10 hereof, and (ii) shall not permit any
Restricted Subsidiary of the Issuer to issue any of its Equity Interests (other
than, if necessary, shares of its Capital Stock constituting directors'
qualifying shares) to any Person other than to the Issuer or a Restricted
Subsidiary of the Issuer; provided, however, that the foregoing restrictions
shall not apply to transfers, conveyances, sales, leases or other dispositions
(collectively "dispositions") of any Capital Stock of any Restricted Subsidiary
that have a fair market value at the time of such disposition of less than $5
million.
Section 4.17. Payments for Consent.
Neither the Issuer nor any of its Restricted Subsidiaries shall, directly
or indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise, to any Holder of any Note for or as an inducement to
any consent, waiver or amendment of any of the terms or provisions of this
Indenture or the Notes unless such consideration is offered to be paid or is
paid
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to all Holders of the Notes that consent, waive or agree to amend in the time
frame set forth in the solicitation documents relating to such consent, waiver
or agreement.
ARTICLE 5.
SUCCESSORS
Section 5.01. Merger, Consolidation or Sale of Assets.
The Issuer shall not consolidate or merge with or into (whether or not the
Issuer is the surviving corporation), or sell, assign, transfer, lease, convey
or otherwise dispose of all or substantially all of its properties or assets in
one or more related transactions, to another Person unless (i) the Issuer is the
surviving corporation or the Person formed by or surviving any such
consolidation or merger (if other than the Issuer) or to which such sale,
assignment, transfer, lease, conveyance or other disposition shall have been
made is organized and existing under the laws of the United States, any state
thereof or the District of Columbia; (ii) the Person formed by or surviving any
such consolidation or merger (if other than such Issuer), or the Person to which
such sale, assignment, transfer, lease, conveyance or other disposition shall
have been made, assumes all the obligations of the Issuer under the Notes and
this Indenture pursuant to a supplemental indenture in form reasonably
satisfactory to the Trustee; (iii) immediately after such transaction, no
Default or Event of Default exists; and (iv) except in the case of a merger of
the Issuer with or into one of its Wholly Owned Restricted Subsidiaries, the
Issuer or the Person formed by or surviving any such consolidation or merger (if
other than the Issuer), or to which such sale, assignment, transfer, lease,
conveyance or other disposition shall have been made, shall, at the time of such
transaction and after giving pro forma effect thereto as if such transaction had
occurred at the beginning of the applicable four-quarter period, have a
Consolidated Net Worth in an amount which is not less than the Consolidated Net
Worth of the Issuer immediately prior to such transaction. Notwithstanding the
foregoing clauses (iii) and (iv), (a) any Restricted Subsidiary may consolidate
with, merge into or transfer all or part of its properties and assets to the
Issuer and (b) the Issuer may merge with an Affiliate incorporated solely for
the purpose of reincorporating the Issuer in another jurisdiction. In the case
of a sale, assignment, lease, transfer, conveyance or other disposition of all
or substantially all of the assets of the Issuer, upon the assumption provided
for in clause (ii) above, the Issuer shall be discharged from all further
liability and obligation under this Indenture.
Prior to the proposed transaction, the Issuer shall deliver to the Trustee
an Officers' Certificate and an Opinion of Counsel, each of which shall state
that such consolidation, merger or transfer and such supplemental indenture
comply with this Article 5 and that all conditions precedent herein provided for
relating to such transaction have been complied with.
Section 5.02. Successor Corporation Substituted.
Upon any consolidation or merger, or any sale, assignment, transfer, lease,
conveyance or other disposition of all or substantially all of the assets of the
Issuer in accordance with Section 5.01 hereof, the successor Person formed by
such consolidation or into or with which the Issuer is merged or to which such
sale, assignment, transfer, lease, conveyance or other disposition is made shall
succeed to, and be substituted for (so that from and after the date of such
consolidation, merger, sale, lease, conveyance or other disposition, the
provisions of this
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Indenture referring to the "Issuer" shall refer instead to such successor and
not to the Issuer), and may exercise every right and power of, the Issuer under
this Indenture with the same effect as if such successor Person had been named
as the Issuer herein; provided, however, that the predecessor Issuer shall not
be relieved from the obligation to pay the principal of and premium and interest
on the Notes except in the case of a sale of all or substantially all of the
Issuer's assets as provided in the last sentence of the first paragraph of
Section 5.01 hereof.
Section 5.03. Exclusion.
The foregoing provisions of this Article 5 shall not apply to any Principal
Asset Sale or Principal Asset Sales.
ARTICLE 6.
DEFAULTS AND REMEDIES
Section 6.01. Events of Default.
An "Event of Default" occurs if:
(a) the Issuer defaults for 30 days in the payment when due of interest on
the Notes;
(b) the Issuer defaults in payment when due of the principal of or premium,
if any, on the Notes;
(c) the Issuer fails, and such failure continues for 30 days after notice
from the Trustee, or from the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding, to comply with the Issuer's obligations to
be performed pursuant to Section 4.15 or Article 5 hereof;
(d) the Issuer fails, and such failure continues for 45 days after notice
from the Trustee, or from the Holders of at least 25% in aggregate principal
amount of the Notes then outstanding, to comply with any of its other agreements
in this Indenture, the Notes or the Security Documents; or any of the
representations and warranties made by the Issuer in the Pledge Agreement or the
Intercreditor Agreement shall have been untrue in any material respect when
made;
(e) (i) an event of default occurs under the New Credit Facility entered
into in connection with the implementation of the Plan, or under any other New
Credit Facility under which Indebtedness outstanding, together with any
additional amount that may be borrowed thereunder, aggregate at the time of
determination hereunder at least $10 million in principal amount, and such event
of default continues for 30 days; or (ii) the Issuer defaults under any
mortgage, indenture or instrument under which there may be issued or by which
there may be secured or evidenced any Indebtedness for money borrowed by the
Issuer or any of its Restricted Subsidiaries (or the payment of which is
Guarantied by the Issuer or any of its Restricted Subsidiaries) (other than, in
each such case, Non-Recourse Debt) or Indebtedness referred to in item (xvi) of
the second paragraph of Section 4.09 hereof), whether such Indebtedness or
Guaranty now exists or is created after the date of this Indenture (but not
including Indebtedness referred to in clause (i) of this subsection (e)), which
default referred to in this clause (ii) is
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caused by a failure to pay principal at final maturity or results in the
acceleration of such Indebtedness prior to its Stated Maturity and, in each
case, the principal amount of any such Indebtedness, together with the principal
amount of any other such Indebtedness the Stated Maturity of which has been so
accelerated, aggregates $10 million or more;
(f) the Issuer or any of its Significant Subsidiaries, or any group of
Subsidiaries that, taken together, would constitute a Significant Subsidiary,
fails to pay final judgments (not subject to appeal) aggregating in excess of
$10 million, which judgments are not paid, discharged or stayed for a period of
45 days after the same have become final;
(g) the Issuer or any of its Significant Subsidiaries or any group of
Subsidiaries that, taken as a whole, would constitute a Significant Subsidiary
pursuant to or within the meaning of Bankruptcy Law:
(i) commences a voluntary case;
(ii) consents to the entry of an order for relief against it in an
involuntary case;
(iii) consents to the appointment of a custodian of it or for all or
substantially all of its property;
(iv) makes a general assignment for the benefit of its creditors; or
(v) admits in writing its inability to pay its debts as they become
due;
(h) a court of competent jurisdiction enters an order or decree under any
Bankruptcy Law that:
(i) is for relief against the Issuer or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary in an involuntary case;
(ii) appoints a custodian of the Issuer or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary or for all or substantially all of the
property of the Issuer or any of its Significant Subsidiaries or any group
of Subsidiaries that, taken as a whole, would constitute a Significant
Subsidiary; or
(iii) orders the liquidation of the Issuer or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary;
and the order or decree remains unstayed and in effect for 60 consecutive
days; or
(iv) the Trustee, for the benefit of the Holders, fails or ceases to
have a valid and perfected Lien on any Collateral, subject only to
Permitted Liens.
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Section 6.02. Acceleration.
If any Event of Default occurs and is continuing, the Trustee may, and upon
the direction of the Holders of at least 25% in aggregate principal amount of
the then outstanding Notes shall, declare all the Notes to be due and payable
immediately; provided, however, that in the event of an acceleration based upon
an Event of Default provided for in Section 6.01(e) above, such declaration of
acceleration shall be automatically annulled if the holders of the other
Indebtedness referred to in clause (i) therein have waived the event of default
referred to therein or the holders of the other Indebtedness that is the subject
of acceleration as referred to in clause (ii) thereof have rescinded the
declaration of acceleration in respect of such Indebtedness. Notwithstanding the
foregoing, in the case of an Event of Default provided for in Section 6.01 (g)
above with respect to the Issuer or in clause (i), (ii) or (iii) of Section
6.01(h) above with respect to the Issuer, all outstanding Notes will become due
and payable without further action or notice. Holders of the Notes may not
enforce this Indenture or the Notes except as provided in this Indenture.
Subject to the limitations set forth in Section 6.05 hereof, Holders of a
majority in aggregate principal amount of the then outstanding Notes may direct
the Trustee in its exercise of any trust or power.
Section 6.03. Other Remedies.
If an Event of Default occurs and is continuing, the Trustee may pursue any
available remedy to collect the payment of principal, premium, if any, and
interest on the Notes or to enforce the performance of any provision of the
Notes, this Indenture or the Security Documents, subject to any applicable
provisions of the Intercreditor Agreement.
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. A delay or omission
by the Trustee or any Holder of a Note in exercising any right or remedy
accruing upon an Event of Default shall not impair the right or remedy or
constitute a waiver of or acquiescence in the Event of Default. All remedies are
cumulative to the extent permitted by law.
Section 6.04. Waiver of Past Defaults.
Holders of not less than a majority in aggregate principal amount of the
then outstanding Notes by written notice to the Trustee may on behalf of the
Holders of all of the Notes waive an existing Default or Event of Default and
its consequences hereunder, except (i) a continuing Default or Event of Default
in the payment of the principal of or premium or interest on the Notes (provided
that the Holders of at least a majority in aggregate principal amount of the
Notes may rescind an acceleration and its consequences, including any related
payment default that resulted from such acceleration), and (ii) a default with
respect to a provision that under Section 9.02 hereof cannot be amended without
the consent of each Holder affected. Upon any such waiver, such Default shall
cease to exist, and any Event of Default arising therefrom shall be deemed to
have been cured for every purpose of this Indenture; but no such waiver shall
extend to any subsequent or other Default or impair any right consequent
thereon.
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Section 6.05. Control by Majority.
Holders of a majority in aggregate principal amount of the then outstanding
Notes may direct the time, method and place of conducting any proceeding for
exercising any remedy available to the Trustee, or exercising any trust or power
conferred on it, under this Indenture, the Notes, the Security Documents or
otherwise. However, the Trustee may refuse to follow any direction that
conflicts with law or this Indenture or that the Trustee determines may be
unduly prejudicial to the rights of other Holders or that may involve the
Trustee in personal liability and may take any other action it deems proper that
is not inconsistent with any such direction received from such Holders of the
Notes. In addition, prior to taking any action hereunder, the Trustee shall be
entitled to indemnification from the Holders on terms reasonably satisfactory to
the Trustee against all losses and expenses arising from taking or not taking
such action.
Section 6.06. Limitation on Suits.
A Holder of a Note may pursue a remedy with respect to this Indenture or
the Notes only if:
(a) the Holder of a Note gives to the Trustee written notice of a
continuing Event of Default;
(b) the Holders of at least 25% in aggregate principal amount of the then
outstanding Notes make a written request to the Trustee to pursue the remedy;
(c) such Holder or Holders offer and, if requested, provide to the Trustee
indemnity reasonably satisfactory to the Trustee against any loss, liability or
expense;
(d) the Trustee does not comply with the request within 60 days after
receipt of the request and the offer and, if requested, the provision of
indemnity; and
(e) during such 60-day period the Holders of a majority in aggregate
principal amount of the then outstanding Notes do not give the Trustee a
direction inconsistent with the request.
A Holder of a Note may not use this Indenture to prejudice the rights of another
Holder of a Note or to obtain a preference or priority over another Holder of a
Note.
Section 6.07. Rights of Holders of Notes to Receive Payment.
Notwithstanding any other provision of this Indenture, the right of any
Holder of a Note to receive payment of principal, premium and interest on the
Notes, on or after the respective due dates expressed in the Notes, or to bring
suit for the enforcement of any such payment on or after such respective dates,
shall not be impaired or affected without the consent of such Holder.
Section 6.08. Collection Suit by Trustee.
If an Event of Default provided for in Section 6.01(a) or (b) occurs and is
continuing, the Trustee is authorized to recover judgment in its own name and as
trustee of an express trust
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against the Issuer for the whole amount of principal of, premium and interest
remaining unpaid on the Notes and interest on overdue principal and, to the
extent lawful, interest and such further amount as shall be sufficient to cover
the costs and expenses of collection, including the reasonable compensation,
expenses, disbursements and advances of the Trustee, its agents and counsel.
Section 6.09. Trustee May File Proofs of Claim.
The Trustee is authorized to file such proofs of claim and other papers or
documents as may be necessary or advisable in order to have the claims of the
Trustee (including any claim for the reasonable compensation, expenses,
disbursements and advances of the Trustee, its agents and counsel) and the
Holders of the Notes allowed in any judicial proceedings relative to the Issuer
(or any other obligor upon the Notes), its creditors or its property and shall
be entitled and empowered to collect, receive and distribute any money or other
property payable or deliverable on any such claims, and any custodian in any
such judicial proceeding is hereby authorized by each Holder to 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 hereof. To the extent that the payment of any such
compensation, expenses, disbursements and advances of the Trustee, its agents
and counsel, and any other amounts due the Trustee under Section 7.07 hereof,
out of the estate in any such proceeding shall be denied for any reason, payment
of the same shall be secured by a Lien on, and shall be paid out of, any and all
distributions, dividends, money, securities and other properties that the
Holders may be entitled to receive in such proceeding whether in liquidation or
under any plan of reorganization or arrangement or otherwise. Nothing herein
contained shall be deemed to authorize the Trustee to authorize or consent to or
accept or adopt on behalf of any Holder any plan of reorganization, arrangement,
adjustment or composition affecting the Notes or the rights of any Holder or to
authorize the Trustee to vote in respect of the claim of any Holder in any such
proceeding.
Section 6.10. Priorities.
If the Trustee collects any money pursuant to this Article 6, it shall,
subject to applicable provisions of the Security Documents, pay out the money in
the following order:
First: to the Trustee, its agents and counsel for amounts due under Section
7.07 hereof, including payment of all reasonable compensation, expense and
liabilities incurred, and all advances made, by the Trustee and the costs and
expenses of collection;
Second: to Holders for amounts due and unpaid on the Notes for principal,
premium and interest, ratably, without preference or priority of any kind,
according to the amounts due and payable on the Notes for principal, premium and
interest, respectively; and
Third: to the Issuer or to such party as a court of competent jurisdiction
shall direct.
The Trustee 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 in its discretion may require the filing by any party litigant
in the suit of an undertaking to pay the costs of the suit, and the court in its
discretion may assess reasonable costs, including reasonable attorneys' fees and
expenses, 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 of a
Note pursuant to Section 6.07 hereof or a suit by Holders of more than 10% in
aggregate principal amount of the then outstanding Notes.
ARTICLE 7.
TRUSTEE
Section 7.01. Duties of Trustee.
(a) If an Event of Default has occurred and is continuing, the Trustee
shall exercise such of the rights and powers vested in it by this Indenture, and
use the same degree of care and skill in its exercise of such rights and powers,
as a prudent person would exercise or use under the circumstances in the conduct
of such person's own affairs.
(b) Except during the continuance of an Event of Default:
(i) the duties of the Trustee shall be determined solely by the
express provisions of this Indenture, and the Trustee need perform only
those duties that are specifically set forth in this Indenture and no
others, and no implied covenants or obligations shall be read into this
Indenture against the Trustee; and
(ii) in the absence of bad faith on its part, the Trustee may
conclusively rely, as to the truth of the statements and the correctness of
the opinions expressed therein, on certificates or opinions furnished to
the Trustee and conforming to the requirements of this Indenture. However,
the Trustee shall be under a duty to examine any such certificates or
opinions to determine whether or not they conform to the requirements of
this Indenture (but need not confirm or investigate the accuracy of
mathematical calculations or other facts stated therein).
(c) The Trustee may not be relieved from liability for its own negligent
action, its own negligent failure to act or its own willful misconduct, except
that:
(i) this paragraph does not limit the effect of paragraph (b) of this
Section;
(ii) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer, unless the Trustee was negligent in
ascertaining the pertinent facts; and
(iii) the Trustee shall not be liable with respect to any action it
takes or omits to take in good faith in accordance with a direction
received by it pursuant to Section 6.05 hereof.
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(d) Whether or not therein expressly so provided, every provision of this
Indenture that in any way relates to the Trustee is subject to paragraphs (a),
(b), (c), and (e) of this Section 7.01 and Section 7.02.
(e) No provision of this Indenture shall require the Trustee to expend or
risk its own funds or incur any liability. The Trustee shall be under no
obligation to exercise any of its rights and powers under this Indenture at the
request of any Holders, unless such Holders shall have offered to the Trustee
security and indemnity satisfactory to it against any loss, liability or
expense.
(f) The Trustee shall not (i) be liable for interest on any money received
by it or (ii) be required to invest any such moneys, except in either case as
the Trustee may agree in writing with the Issuer. Money held in trust by the
Trustee need not be segregated from other funds except to the extent required by
law or by an agreement in writing with the Issuer.
(g) The Trustee shall not be bound to make any investigation into facts or
matters stated in any resolution, certificate, statement, instrument, opinion,
report, notice, request, direction, consent, order, bond, debenture or other
paper or document, but the Trustee in its discretion may make such further
inquiry into such facts or matters as it may see fit. If the Trustee shall
determine to make such further inquiry, it shall be entitled to examine books,
records and premises of the Issuer, personally or by agent or attorney.
(h) In no event shall the Trustee be liable for (i) any indirect, special,
punitive or consequential loss or damage of any kind whatsoever, including but
not limited to lost profits, even if the Trustee has been advised of the
likelihood of such loss or damage and regardless of the form of action, or (ii)
any failure or delay in the performance of its obligations hereunder because of
circumstances beyond its control, including but not limited to acts of God,
flood, war (whether declared or undeclared), terrorism, fire, riot, embargo or
governmental action, including any laws, ordinances, regulations or governmental
action which delay, restrict or prohibit the performance by the Trustee of its
services to be provided pursuant to this Indenture.
Section 7.02. Rights of Trustee.
(a) The Trustee may conclusively rely on any document believed by it to be
genuine and to have been signed or presented by the proper Person. The Trustee
may in its discretion, but need not, investigate any fact or matter stated in
the document.
(b) Before the Trustee acts or refrains from acting, it may require an
Officers' Certificate or an Opinion of Counsel or both. The Trustee shall not be
liable for any action it takes or omits to take in good faith in reliance on
such Officers' Certificate or Opinion of Counsel. The Trustee may consult with
counsel of its selection and the advice of such counsel or any Opinion of
Counsel shall be full and complete authorization and protection from liability
in respect of any action taken, suffered or omitted by it hereunder in good
faith and in reliance thereon.
(c) The Trustee may act through its attorneys and agents and shall not be
responsible for the misconduct or negligence of any agent appointed by it with
due care.
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(d) The Trustee shall not be liable for any action it takes or omits to
take in good faith that it believes to be authorized or within the rights or
powers conferred upon it by this Indenture; provided that the Trustee's conduct
does not constitute willful misconduct or negligence.
(e) Unless otherwise specifically provided in this Indenture, any demand,
request, direction or notice from the Issuer shall be sufficient if signed by an
Officer of the Issuer.
(f) The Trustee shall be under no obligation to exercise any of the rights
or powers vested in it by this Indenture at the request or direction of any of
the Holders unless such Holders shall have offered to the Trustee reasonable
security or indemnity against the costs, expenses and liabilities that might be
incurred by it in compliance with such request or direction.
(g) The Trustee shall not be deemed to have notice of any Default or Event
of Default unless a Responsible Officer of the Trustee has actual knowledge
thereof or unless written notice of any event that is in fact such a Default or
Event of Default is received by the Trustee at the Corporate Trust Office of the
Trustee, and such notice references the Notes and this Indenture.
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 Issuer or any Affiliate of the
Issuer with the same rights it would have if it were not Trustee. However, in
the event that the Trustee acquires any conflicting interest it must eliminate
such conflict within 90 days, apply to the SEC for permission to continue as
trustee or resign, if necessary. Any Agent may do the same with like rights and
duties. The Trustee is also subject to Sections 7.10 and 7.11 hereof.
Section 7.04. Trustee's Disclaimer.
The Trustee shall not be responsible for and makes no representation as to
the validity or adequacy of this Indenture or the Notes, it shall not be
accountable for the Issuer's use of any proceeds from the Notes or any money
paid to the Issuer or upon the Issuer's direction under any provision of this
Indenture, it shall not be responsible for the use or application of any money
received by any Paying Agent other than the Trustee and it shall not be
responsible for any statement or recital herein or any statement in the Notes or
any other document in connection with the issuance of the Notes or pursuant to
this Indenture other than its certificate of authentication.
Section 7.05. Notice of Defaults.
If a Default or Event of Default occurs and is continuing and is known to
the Trustee, the Trustee shall mail to Holders a notice of the Default or Event
of Default within 30 days after it occurs. Except in the case of a Default or
Event of Default in payment of principal of, premium, if any, or interest on any
Note, the Trustee may withhold the notice if and so long as a committee of its
Responsible Officers in good faith determines that withholding the notice is in
the interest of the Holders of the Notes.
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Section 7.06. Reports by Trustee to Holders of the Notes.
Within 60 days after each April 15 beginning with the April 15 following
the date of this Indenture, and for so long as Notes remain outstanding, the
Trustee shall mail to the Holders of the Notes a brief report dated as of such
reporting date that complies with TIA ss. 313(a) (but if no event described in
TIA ss. 313(a) has occurred within the twelve months preceding the reporting
date, no report need be transmitted). The Trustee also shall comply with TIA ss.
313(b)(2). The Trustee shall also transmit by mail all reports as required by
TIA ss. 313(c).
A copy of each report at the time of its mailing to the Holders shall be
mailed to the Issuer and filed with the SEC and each stock exchange, if any, on
which the Notes are listed in accordance with TIA ss. 313(d). The Issuer shall
promptly, and in any event within 10 Business Days, notify the Trustee when the
Notes are listed on any stock exchange.
Section 7.07. Compensation and Indemnity.
The Issuer shall pay to the Trustee from time to time such compensation as
the Trustee and the Issuer shall from time to time agree in writing for its
acceptance of this Indenture and services hereunder. The Trustee's compensation
shall not be limited by any law on compensation of a trustee of an express
trust. The Issuer shall reimburse the Trustee promptly upon request for all
reasonable disbursements, advances and expenses incurred or made by it in
addition to the compensation for its services. Such expenses shall include the
reasonable compensation, disbursements and expenses of the Trustee's agents and
counsel.
The Issuer shall indemnify the Trustee against any and all losses,
liabilities, damages, claims or expenses (including reasonable attorneys' fees
or taxes (other than taxes based on the income of the Trustee)) incurred by it
arising out of or in connection with the acceptance or administration of this
Indenture and the performance of its duties under this Indenture, including the
costs and expenses of enforcing this Indenture against the Issuer (including
this Section 7.07) and defending itself against any claim (whether asserted by
the Issuer, any Holder or any other Person) or liability in connection with the
exercise or performance of any of its powers or duties hereunder, except to the
extent any such loss, liability or expense may be attributable to its
negligence, willful misconduct or bad faith. The Trustee shall notify the Issuer
promptly of any claim for which it may seek indemnity. Failure by the Trustee to
so notify the Issuer shall not relieve the Issuer of its obligations hereunder.
The Issuer shall defend the claim and the Trustee shall cooperate in the
defense. The Trustee may have separate counsel, and the Issuer shall pay the
reasonable fees and expenses of such counsel. The Issuer need not pay for any
settlement made without its consent, which consent shall not be unreasonably
withheld.
The obligations of the Issuer under this Section 7.07 shall survive the
satisfaction and discharge of this Indenture.
To secure the payment obligations of the Issuer in this Section, the
Trustee shall have a Lien prior to the claims of the Holders of the Notes on all
money or property held or collected by the Trustee, except that held in trust to
pay principal and interest on particular Notes. Such Lien shall survive the
satisfaction and discharge of this Indenture.
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When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.01(g) hereof or clause (i), (ii) or (iii) of
Section 6.01(h) hereof occurs, the expenses and the compensation for the
services (including the fees and expenses of its agents and counsel) are
intended to constitute expenses of administration under any Bankruptcy Law.
The Trustee shall comply with the provisions of TIA ss. 313(b)(2) to the
extent applicable.
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 and be discharged from the trust hereby
created by so notifying the Issuer in writing. The Holders of a majority in
principal amount of the then outstanding Notes may remove the Trustee by so
notifying the Trustee and the Issuer in writing. The Issuer may remove the
Trustee without prior notice and without liability to the Issuer by notifying
the Trustee in writing if:
(a) the Trustee fails to comply with Section 7.10 hereof;
(b) the Trustee is adjudged a bankrupt or an insolvent or an order for
relief is entered with respect to the Trustee under any Bankruptcy Law;
(c) a custodian or public officer takes charge of the Trustee or its
property; or
(d) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the office
of Trustee for any reason, the Issuer 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 then outstanding Notes may appoint a
successor Trustee to replace the successor Trustee appointed by the Issuer.
If a successor ▇▇▇▇▇▇▇ does not take office within 60 days after the
retiring Trustee resigns or is removed, the retiring Trustee, the Issuer or the
Holders of at least 10% in principal amount of the then outstanding Notes may
petition, at the expense of the Issuer, any court of competent jurisdiction for
the appointment of a successor Trustee.
If the Trustee, after written request by any Holder of a Note who has been
a Holder of a Note for at least six months, fails to comply with Section 7.10,
such Holder of a Note may petition any court of competent jurisdiction for the
removal of the Trustee and the appointment of a successor Trustee.
A successor Trustee shall deliver a written acceptance of its appointment
to the retiring Trustee and to the Issuer. Thereupon, the resignation or removal
of the retiring Trustee shall become effective, and the successor Trustee shall
have all the rights, powers and duties of the Trustee under this Indenture. The
successor Trustee shall mail a notice of its succession to
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Holders of the Notes. The retiring Trustee shall promptly transfer all property
held by it as Trustee to the successor Trustee, if all sums owing to the Trustee
hereunder have been paid and subject to the Lien provided for in Section 7.07
hereof. Notwithstanding replacement of the Trustee pursuant to this Section
7.08, the Issuer's obligations under Section 7.07 hereof shall continue for the
benefit of the retiring Trustee.
Section 7.09. Successor Trustee by ▇▇▇▇▇▇, Etc.
If the Trustee consolidates, merges or converts into, or transfers all or
substantially all of its corporate trust business to, another corporation, the
successor corporation without any further act shall be the successor Trustee.
Section 7.10. Eligibility; Disqualification.
There shall at all times be a Trustee hereunder that is a corporation
organized and doing business under the laws of the United States of America or
of any state thereof that is authorized under such laws to exercise corporate
trustee power, that is subject to supervision or examination by federal or state
authorities and that has a combined capital and surplus of at least $100 million
as set forth in its most recent published annual report of condition.
This Indenture shall always have a Trustee that satisfies the requirements
of TIA ss. 310(a)(1), (2) and (5). The Trustee is subject to TIA ss. 310(b).
Section 7.11. Preferential Collection of Claims Against Issuer.
The Trustee is subject to TIA ss. 311(a), excluding any creditor
relationship listed in TIA ss. 311(b). A Trustee that has resigned or been
removed shall be subject to TIA ss. 311(a) to the extent indicated therein.
ARTICLE 8.
DISCHARGE OF INDENTURE;
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.01. Satisfaction and Discharge of Indenture.
When (i) all outstanding Notes theretofore authenticated and issued have
been delivered (other than destroyed, lost or stolen Notes that have been
replaced or paid) to the Trustee for cancellation and the Issuer has paid all
sums payable by the Issuer hereunder or (ii) (x) all of the outstanding Notes
not previously canceled or delivered to the Trustee for cancellation shall have
become due and payable, including upon notice of redemption under arrangements
satisfactory to the Trustee, and (y) the Issuer shall have deposited with the
Trustee, in trust, cash in U.S. dollars in an amount sufficient to pay the
principal of, premium, if any, and interest on all of the Notes (other than
destroyed, lost or stolen Notes that have been replaced or paid) not previously
canceled or delivered to the Trustee for cancellation, on the date such payments
are due to such date of maturity or redemption, as the case may be, and if, in
the case of either clause (i) or (ii), the Issuer shall also pay or cause to be
paid all other sums payable hereunder by the Issuer, then this Indenture shall
cease to be of further effect (except as to (1) remaining rights of registration
of transfer, substitution and exchange, (2) rights hereunder of Holders to
receive payments of
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principal of, premium, if any, and interest on the Notes and the other rights,
duties and obligations of Holders as beneficiaries hereof with respect to the
amounts so deposited with the Trustee and (3) the rights, obligations and
immunities of the Trustee hereunder), and the Trustee, on demand of the Issuer
accompanied by an Officers' Certificate and an Opinion of Counsel as provided in
Section 11.05 hereof and at the cost and expense of the Issuer, shall execute
proper instruments acknowledging satisfaction of and discharging this Indenture.
In addition, the Issuer may satisfy its obligations under this Indenture as
provided in Section 8.02 hereof.
Section 8.02. Option to Effect Legal Defeasance or Covenant Defeasance.
The Issuer may, at the option of its Board of Directors evidenced by a
resolution set forth in an Officers' Certificate, at any time, elect to have
either Section 8.03 or 8.04 hereof applied to all outstanding Notes upon
compliance with the conditions set forth below in this Article 8.
Section 8.03. Legal Defeasance and Discharge.
Upon the Issuer's exercise under Section 8.02 hereof of the option
applicable to this Section 8.03, the Issuer shall, subject to the satisfaction
of the conditions set forth in Section 8.05 hereof, be deemed to have been
discharged from its obligations with respect to all outstanding Notes on the
date the conditions set forth below are satisfied (hereinafter, "Legal
Defeasance"). For this purpose, Legal Defeasance means that the Issuer shall be
deemed to have paid and discharged the entire Indebtedness represented by the
outstanding Notes, which shall thereafter be deemed to be "outstanding" only for
the purposes of Section 8.06 hereof and the other Sections of this Indenture
referred to in (a) and (b) below, and to have satisfied all of its other
obligations under the Notes and this Indenture (and the Trustee, on demand of
and at the expense of the Issuer, shall execute proper instruments acknowledging
the same), except for the following provisions, which shall survive until
otherwise terminated or discharged hereunder or until the Notes have been paid
in full: (a) the rights of Holders of outstanding Notes to receive solely from
the trust fund described in Section 8.06 hereof, and as more fully set forth in
such Section, payments in respect of the principal of, premium, if any, and
interest on such Notes when such payments are due, (b) the Issuer's obligations
with respect to such Notes under Article 2 and Section 4.02 hereof, (c) the
rights, powers, trusts, duties and immunities of the Trustee hereunder and the
Issuer's obligations in connection therewith and (d) this Article 8. Subject to
compliance with this Article 8, the Issuer may exercise its option under this
Section 8.03 notwithstanding the prior exercise of its option under Section 8.04
hereof.
Section 8.04. Covenant Defeasance.
Upon the Issuer's exercise under Section 8.02 hereof of the option
applicable to this Section 8.04, the Issuer shall, subject to the satisfaction
of the conditions set forth in Section 8.05 hereof, be released from its
obligations under the covenants set forth in Article 4 hereof except for
Sections 4.01 and 4.02 and, to the extent required by law, 4.04, and, with
respect to the outstanding Notes on and after the date the conditions set forth
in Section 8.05 are satisfied (hereinafter, "Covenant Defeasance"), and the
Notes shall thereafter be deemed not "outstanding" for the purposes of any
direction, waiver, consent or declaration or act of Holders
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(and the consequences of any thereof) in connection with such covenants, but
shall continue to be deemed "outstanding" for all other purposes hereunder (it
being understood that such Notes shall not be deemed outstanding for accounting
purposes). For this purpose, Covenant Defeasance means that, with respect to the
outstanding Notes, the Issuer may omit to comply with and shall have no
liability in respect of any term, condition or limitation set forth in any such
covenant, whether directly or indirectly, by reason of any reference elsewhere
herein to any such covenant or by reason of any reference in any such covenant
to any other provision herein or in any other document, and such omission to
comply shall not constitute a Default or an Event of Default under Section 6.01
hereof, but, except as specified above, the remainder of this Indenture and such
Notes shall be unaffected thereby. In addition, upon the Issuer's exercise under
Section 8.02 hereof of the option applicable to this Section 8.04, subject to
the satisfaction of the conditions set forth in Section 8.05 hereof, Sections
6.01(c) through (h) hereof (but, in the case of Sections 6.01(g) and (h), with
respect only to Significant Subsidiaries) shall not constitute Events of
Default.
Section 8.05. Conditions to Legal or Covenant Defeasance.
The following shall be the conditions to the application of either Section
8.03 or 8.04 hereof to the outstanding Notes. In order to exercise either Legal
Defeasance or Covenant Defeasance:
(a) the Issuer must irrevocably deposit with the Trustee, in trust, for the
benefit of the Holders, cash in United States dollars, non-callable United
States Government Obligations or a combination thereof in such amounts as shall
be 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 the principal of, premium, if any, and interest on the
outstanding Notes on the stated date for payment thereof or on the applicable
redemption date, as the case may be, and the Issuer must specify whether the
Notes are being defeased to maturity or to a particular redemption date;
(b) in the case of an election under Section 8.03 hereof, the Issuer shall
have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that (I) the Issuer has received
from, or there has been published by, the Internal Revenue Service a ruling or
(II) since the date of this Indenture, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based thereon
such Opinion of Counsel shall confirm that, the Holders of the outstanding Notes
shall not recognize income, gain or loss for federal income tax purposes as a
result of such Legal Defeasance and shall be subject to federal income tax on
the same amounts, in the same manner and at the same times as would have been
the case if such Legal Defeasance had not occurred;
(c) in the case of an election under Section 8.04 hereof, the Issuer shall
have delivered to the Trustee an Opinion of Counsel in the United States
reasonably acceptable to the Trustee confirming that the Holders of the
outstanding Notes shall not recognize income, gain or loss for federal income
tax purposes as a result of such Covenant Defeasance and shall be subject to
federal income tax on the same amounts, in the same manner and at the same times
as would have been the case if such Covenant Defeasance had not occurred;
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(d) no Default or Event of Default shall occur under Section 6.01(g) or
6.01(h) hereof at any time in the period ending on the 91st day after the date
of deposit;
(e) such Legal Defeasance or Covenant Defeasance shall not result in a
breach or violation of, or constitute a default under, any material agreement or
instrument to which the Issuer or any of its Restricted Subsidiaries is a party
or by which the Issuer or any of its Restricted Subsidiaries is bound;
(f) on the 123rd day following the deposit, the trust funds shall not be
subject to the effect of any applicable bankruptcy, insolvency, reorganization
or similar laws affecting creditors' rights generally;
(g) the Issuer shall have delivered to the Trustee an Officers' Certificate
stating that the deposit was not made by the Issuer with the intent of
preferring the Holders over any other creditors of the Issuer or with the intent
of defeating, hindering, delaying or defrauding any other creditors of the
Issuer; and
(h) the Issuer shall have delivered to the Trustee an Officers' Certificate
and an Opinion of Counsel, each stating that all conditions precedent provided
for or relating to the Legal Defeasance or the Covenant Defeasance have been
complied with.
Section 8.06. Deposited Money and Government Obligations to Be Held in Trust;
Other Miscellaneous Provisions.
Subject to Section 8.07 hereof, all money and United States Government
Obligations (including the proceeds thereof) deposited with the Trustee (or
other qualifying trustee, collectively for purposes of this Section 8.06, the
"Trustee") pursuant to Section 8.05 hereof in respect of the outstanding Notes
shall be held in trust and applied by the Trustee, in accordance with the
provisions of such Notes and this Indenture, to the payment, either directly or
through any Paying Agent (including the Issuer acting as Paying Agent) as the
Trustee may determine, to the Holders of such Notes of all sums due and to
become due thereon in respect of principal, premium, if any, and interest, but
such money need not be segregated from other funds except to the extent required
by law.
The Issuer shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the cash or securities deposited
pursuant to Section 8.05 hereof or the principal and interest received in
respect thereof other than any such tax, fee or other charge which by law is for
the account of the Holders of the outstanding Notes.
Anything in this Article 8 to the contrary notwithstanding, the Trustee
shall deliver or pay to the Issuer from time to time upon the request of the
Issuer any money or securities held by it as provided in Section 8.05 hereof
which, in the opinion of a nationally recognized firm of independent public
accountants expressed in a written certification thereof delivered to the
Trustee (which may be the opinion delivered under Section 8.05(a) hereof), are
in excess of the amount thereof that would then be required to be deposited to
effect an equivalent Legal Defeasance or Covenant Defeasance.
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Section 8.07. Repayment to Issuer.
The Trustee and the Paying Agent shall promptly pay to the Issuer upon
written request any excess money or securities held by them at any time.
The Trustee and the Paying Agent shall pay to the Issuer upon written
request any money held by them for the payment of principal, premium or interest
that remains unclaimed for two years after the date upon which such payment
shall have become due; provided, however, that the Issuer shall have either
caused notice of such payment to be mailed to each Holder of the Notes entitled
thereto no less than 30 days prior to such repayment or within such period shall
have published such notice in a financial newspaper of widespread circulation
published in The City of New York, including, without limitation, The Wall
Street Journal. After payment to the Issuer, Holders of the Notes entitled to
the money must look to the Issuer for payment as general creditors unless an
applicable abandoned property law designates another Person, and all liability
of the Trustee and such Paying Agent with respect to such money shall cease.
Section 8.08. Reinstatement.
If the Trustee or Paying Agent is unable to apply any money or United
States Government Obligations in accordance with Section 8.03 or 8.04, 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, then the Issuer's obligations under this
Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 8.03 or 8.04, as the case may be, until such time
as the Trustee or Paying Agent is permitted to apply all such money or United
States Government Obligations in accordance with Section 8.03 or 8.04, as the
case may be; provided, however, that if the Issuer has made any payment of
interest on or principal or premium of any Notes because of the reinstatement of
its obligations, the Issuer shall be subrogated to the rights of the Holders of
such Notes to receive such payment from the money or United States Government
Obligations held by the Trustee or Paying Agent.
ARTICLE 9.
AMENDMENT, SUPPLEMENT AND WAIVER
Section 9.01. Without Consent of Holders of Notes.
Notwithstanding the provisions of Section 9.02 hereof, the Issuer and the
Trustee may amend or supplement this Indenture, the Notes or any of the Security
Documents without the consent of any Holder:
(a) to cure any ambiguity, defect or inconsistency;
(b) to provide for uncertificated Notes in addition to or in place of
certificated Notes in a manner that does not materially adversely affect any
Holder;
(c) to provide for the assumption of the Issuer's obligations to the
Holders by a successor to the Issuer pursuant to Article 5 hereof;
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(d) to make changes in the Security Documents determined by the Issuer to
be necessary or appropriate in connection with the execution and delivery by the
Issuer of the initial New Credit Facility, provided that no such change shall
terminate the Lien on any of the Collateral provided for in the Pledge
Agreement, subordinate such Lien to the Lien of any other Person, other than
Liens securing Indebtedness and obligations under the New Credit Facility, or
otherwise materially and adversely affect such Lien;
(e) to make any change that would provide any additional rights or benefits
to the Holders or that does not adversely affect the legal rights hereunder or
thereunder of any Holder; or
(f) to comply with requirements of the SEC in order to effect or maintain
the qualification of this Indenture under the TIA.
Upon the request of the Issuer accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture or other
such amendment, and upon receipt by the Trustee of the documents described in
Section 7.02 hereof, the Trustee shall join with the Issuer in the execution of
any amended or supplemental Indenture or other such amendment authorized or
permitted by the terms of this Indenture, but the Trustee shall not be obligated
to enter into such amended or supplemental Indenture or other such amendment
that affects its own rights, duties or immunities under this Indenture or
otherwise.
Section 9.02. With Consent of Holders of Notes.
Except as provided below in this Section 9.02, the Issuer and the Trustee
may amend or supplement this Indenture, the Notes or any of the Security
Documents with the consent of the Holders of at least a majority in aggregate
principal amount of the Notes then outstanding (including consents obtained in
connection with a tender offer or exchange offer for, or purchase of, Notes),
and, with such consent and subject to Sections 6.04 and 6.07 hereof, may waive
any existing Default or Event of Default (other than a Default or Event of
Default in the payment of the principal of, premium, if any, or interest on the
Notes, except a payment default resulting from an acceleration that has been
rescinded) or compliance with any provision of this Indenture, the Notes or the
Security Documents.
Upon the request of the Issuer accompanied by a Board Resolution
authorizing the execution of any such amended or supplemental Indenture or other
such amendment, and upon the filing with the Trustee of evidence satisfactory to
the Trustee of the consent of the Holders as aforesaid, and upon receipt by the
Trustee of the documents described in Section 7.02 hereof, the Trustee shall
join with the Issuer in the execution of such amended or supplemental Indenture
or other such amendment unless such amended or supplemental Indenture or other
such amendment affects the Trustee's own rights, duties or immunities under this
Indenture or otherwise, in which case the Trustee may in its discretion, but
shall not be obligated to, enter into such amended or supplemental Indenture or
other such amendment.
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.
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After an amendment, supplement or waiver under this Section becomes
effective, the Issuer shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Issuer to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such amended or supplemental Indenture
or waiver.
Notwithstanding the foregoing, without the consent of each Holder affected,
an amendment or waiver under this Section 9.02 may not (with respect to any
Notes held by a non-consenting Holder):
(a) reduce the principal amount of Notes whose Holders must consent to an
amendment, supplement or waiver;
(b) reduce the principal of or change the fixed maturity of any Note or
alter or waive any of the provisions with respect to the redemption of the Notes
(provided that this subsection (b) shall not be deemed to apply to any
alteration of or waiver with respect to the definition of the term "Excess Cash
Flow" or the term "Net Proceeds" (or any other defined terms used in such
definitions) contained in Section 1.01 hereof);
(c) reduce the rate of or extend the time for payment of interest,
including default interest, on any Note;
(d) make any Note payable in money other than that stated in the Notes;
(e) make any change in the provisions of this Indenture governing waivers
of past Defaults or the rights of Holders to receive payments of principal of,
premium, if any, or interest on the Notes; or
(f) provide for the release of any material Pledged Equity Interests (as
such term is defined in the Pledge Agreement) except in accordance with the
terms of the Security Documents.
Section 9.03. Compliance with Trust Indenture Act.
Every amendment or supplement to this Indenture or the Notes shall be set
forth in an amended or supplemental Indenture that complies with the TIA as then
in effect.
Section 9.04. Revocation and Effect of Consents.
Until an amendment, supplement or waiver becomes effective, a consent to it
by a Holder is a continuing consent by the Holder and every subsequent Holder or
portion of a Note that evidences the same debt as the consenting Holder's Note,
even if notation of the consent is not made on any Note. However, any such
Holder of a Note or subsequent Holder may revoke the consent as to its Note if
the Trustee receives written notice of revocation before the date the amendment,
supplement or waiver becomes effective. An amendment, supplement or waiver
becomes effective on receipt by the Trustee of written consents from the Holders
of the requisite percentage in principal amount of the outstanding Notes in
accordance with its terms and thereafter binds every Holder.
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The Issuer may, but shall not be obligated to, fix a record date for the
purpose of determining the Holders of Notes 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 of Notes 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 of such Notes after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
Section 9.05. Notation on or Exchange of Notes.
The Trustee may place an appropriate notation about an amendment,
supplement or waiver on any Note thereafter authenticated. The Issuer in
exchange for all Notes may issue, and the Trustee shall, upon receipt of written
instructions signed by an Officer of the Issuer, authenticate, new Notes that
reflect the amendment, supplement or waiver.
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 9.06. Trustee to Sign Amendments, Etc.
The Trustee shall sign any amended or supplemental Indenture authorized
pursuant to this Article 9 if the amendment or supplement does not adversely
affect the rights, duties, liabilities or immunities of the Trustee. The Issuer
may not sign an amendment or supplemental Indenture until the Board of Directors
approves it. In executing any amended or supplemental indenture, the Trustee
shall be entitled to receive and (subject to Section 7.01 hereof) shall be fully
protected in relying conclusively upon an Officers' Certificate and an Opinion
of Counsel stating that the execution of such amended or supplemental indenture
is authorized or permitted by this Indenture.
ARTICLE 10.
SECURITY
Section 10.01. Pledge and Intercreditor Agreements.
(a) In order to secure the due and punctual payment of the principal of,
premium, if any, and interest on the Notes when and as the same shall become due
and payable, whether on an interest payment date, at maturity, by acceleration,
purchase hereunder, redemption or otherwise and interest on the overdue
principal of, premium, if any, and (to the extent permitted by law) interest, on
the Notes and performance of all of the other obligations of the Issuer to the
Holders or the Trustee under this Indenture, the Notes and the Pledge Agreement,
the Issuer and the Trustee shall, concurrently with the initial issuance of the
Notes, enter into the Pledge Agreement, pursuant to which the Issuer will pledge
and grant to the Trustee a security interest in all of the right, title and
interest of the Issuer in, to and under the Collateral referred to therein for
the equal and ratable benefit and security of the Holders of the Notes, without
preference, priority or distinction of any thereof over any other by reason of
difference in time of issuance, sale or otherwise, and for the Trustee or any
other agent for such Holders to the extent provided in this Indenture and in the
Security Documents. At the time the Pledge Agreement is executed
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and delivered, the Issuer will have full right, power and lawful authority to
pledge and grant a security interest in the property constituting the
Collateral, in the manner and form done, or intended to be done, in this
Indenture and the Pledge Agreement, free and clear of all Liens whatsoever,
except Permitted Liens, and except to the extent otherwise provided therein and
herein, (i) will forever warrant and defend the title to the same against the
claims of all other Persons whatsoever, (ii) will execute, acknowledge and
deliver to the Trustee such further assignments, transfers, assurances or other
instruments as the Trustee may reasonably request and (iii) will do or cause to
be done all such acts and things as may be necessary or proper, or as may be
reasonably requested by the Trustee, to assure and confirm to the Trustee the
perfection and priority of the security interests in the Collateral contemplated
by the Pledge Agreement, all subject to the provisions of the Intercreditor
Agreement, so as to render the same available for the security and benefit of
this Indenture and of the Notes, according to the intent and purposes herein
expressed.
(b) Each Holder, by accepting a Note, (i) consents and agrees to all of the
terms and provisions of the Security Documents, as the same may be amended from
time to time in accordance with the provisions thereof and of this Indenture and
be in effect from time to time, (ii) authorizes and directs the Trustee to enter
into the Security Documents and to act as the secured party under the Pledge
Agreement and the Junior Secured Creditor under the Intercreditor Agreement and
(iii) authorizes and directs each of the Tranche A and Tranche B Trustee to act
as collateral agent under the Intercreditor Agreement as and to the extent
provided therein; provided, however, that if any provision of the Security
Documents limits, qualifies or conflicts with the duties imposed by the TIA,
when applicable, the TIA shall control.
Section 10.02. Recording and Opinions.
(a) The Issuer will, at its own expense, register, record and file or
rerecord, refile and renew the Security Documents, this Indenture and all
amendments or supplements thereto in such manner and in such place or places, if
any, as may be required by law in order fully to preserve and protect the Liens
of the Security Documents on all of the Collateral and to effectuate and
preserve the perfection and priority of the security intended to be created and
maintained hereby and thereby.
(b) The Issuer will furnish to the Trustee on the first day of April (or if
such day is not a Business Day, on the next day that is a Business Day) in each
year, beginning with the year 2005, an Opinion of Counsel dated as of such date,
either:
(i) (A) stating that, in the opinion of such counsel, all action has
been taken with respect to the recording, registering, filing,
re-recording, re-registering and re-filing of all supplemental indentures,
financing statements, continuation statements or other instruments as is
necessary to maintain and perfect the Lien of the Security Documents and
reciting with respect to the security interests in the Collateral the
details of such action or referring to prior Opinions of Counsel in which
such details are given and (B) stating that, in the opinion of such
counsel, based on relevant laws as in effect on the date of such Opinion of
Counsel, all financing statements and continuation statements have been
executed and filed that are necessary as of such date and during the
succeeding 12 months fully to preserve, perfect and protect, to the extent
such protection and
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preservation are possible by filing, the rights of the Holders and the
Trustee hereunder and under the Security Documents with respect to the
security interests in the Collateral; or
(ii) stating that, in the opinion of such counsel, no such action is
necessary to maintain and perfect such Liens and maintain the priority of
such Liens in the Collateral.
(c) The Issuer will otherwise comply with the provisions of TIA Section
314(b).
Section 10.03. Actions to Protect Collateral.
In addition to and subject to the provisions of Article VII hereof and of
the Security Documents, the Trustee shall have power to institute and maintain
such suits and proceedings as the Trustee reasonably may deem expedient to
prevent any impairment of the Collateral or of the perfection, status or
priority of the Liens in the Collateral intended by the Security Documents to be
created and maintained or to preserve or protect its interests and the interests
of the Holders in the Collateral.
If an advance of funds shall at any time be required for the preservation
or maintenance of any Collateral, then, upon three Business Days' notice to the
Issuer, the Trustee shall be entitled (but shall not be obligated) to make such
advance. Each such advance shall be reimbursed, with interest from the date such
advance was made (at the rate then borne by the Notes), by the Issuer, upon
demand of the Trustee. Any funds advanced by the Trustee pursuant to this
Section 10.03 for the preservation and maintenance of Collateral shall be
secured obligations hereunder, secured by the security interest in the
Collateral pursuant to the Security Documents.
Section 10.04. Receipt of Funds Under Security Documents.
The Trustee is authorized to receive any funds for the benefit of the
Holders distributed under the Security Documents and to make distributions of
such funds to the Holders according to the provisions of this Indenture and the
Security Documents.
Section 10.05. Release of Collateral.
Collateral may be released from the Lien of the Pledge Agreement in
accordance with the provisions of the Pledge Agreement and any applicable
provisions of any of the other Security Documents. The Trustee and each of the
Holders acknowledges that a release of Collateral or Liens strictly in
accordance with the terms of the Pledge Agreement and any applicable provisions
of any of the other Security Documents will not be deemed for any purpose to be
an impairment of such Liens in contravention of the terms hereof or of the
Security Documents.
To the extent applicable, the Issuer shall cause TIA Section 314(d) to be
complied with. Any certificate or opinion required by TIA Section 314(d) may be
made by any Officer of the Issuer, provided that, to the extent required by TIA
Section 314(d), any such certificate or opinion shall be made by an "independent
appraiser" or other "expert" (as such terms are set forth in TIA Section
314(d)).
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Section 10.06. Intercreditor Agreement.
The rights of the Trustee hereunder and under the Pledge Agreement with
respect to the Collateral are subject to the terms of the Intercreditor
Agreement, and in the event of any conflict or inconsistency between the
provisions of this Indenture or the Pledge Agreement and the provisions of the
Intercreditor Agreement, the provisions of the Intercreditor Agreement shall
control.
ARTICLE 11.
MISCELLANEOUS
Section 11.01. Trust Indenture Act Controls.
If any provision of this Indenture limits, qualifies or conflicts with the
duties imposed by TIA ss. 318(c), the imposed duties shall control.
Section 11.02. Notices.
Any notice or communication by the Issuer or the Trustee to the other is
duly given if in writing and delivered in person or mailed by first class mail
(registered or certified, return receipt requested), telecopier or overnight air
courier promising next Business Day delivery to the other's address:
If to the Issuer:
National Energy & Gas Transmission, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Chief Financial Officer
With a copy to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, III
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and:
If to the Trustee:
Wilmington Trust Company
▇▇▇▇▇▇ Square North
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
The Issuer or the Trustee, by notice to the other, may designate additional
or different addresses for subsequent notices or communications.
All notices and communications (other than those sent to Holders) shall be
deemed to have been duly given: at the time delivered by hand, if personally
delivered; five (5) Business Days after being deposited in the mail, postage
prepaid, if mailed; when receipt acknowledged, if telecopied; and the next
Business Day after timely delivery to the courier, if sent by overnight air
courier promising next Business Day delivery.
Any notice or communication to a Holder shall be mailed by first class mail
or by overnight air courier promising next Business Day delivery to the Holder's
address shown on the register kept by the Registrar. Any notice or communication
shall also be so mailed to any Person described in TIA ss. 313(c), to the extent
required by the TIA. Failure to mail a notice or communication to a Holder or
any defect in it shall not affect its sufficiency with respect to other Holders.
If a notice or communication is mailed in the manner provided above within
the time prescribed, it is duly given, whether or not the addressee receives it.
If the Issuer mails a notice or communication to Holders, it shall mail a
copy to the Trustee and each Agent at the same time.
Section 11.03. Communication by Holders of Notes with Other Holders of Notes.
Holders may communicate pursuant to TIA ss. 312(b) with other Holders with
respect to their rights under this Indenture or the Notes. The Issuer, the
Trustee, the Registrar and anyone else shall have the protection of TIA ss.
312(c).
Section 11.04. Certificate and Opinion as to Conditions Precedent.
Upon any request or application by the Issuer to the Trustee to take any
action under this Indenture (other than the initial issuance of the Notes), the
Issuer shall furnish to the Trustee:
(a) an Officers' Certificate in form and substance reasonably satisfactory
to the Trustee (which shall include the statements set forth in Section 11.05
hereof) stating that, in the opinion of the signers, all conditions precedent
and covenants, if any, provided for in this Indenture relating to the proposed
action have been satisfied; and
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(b) an Opinion of Counsel in form and substance reasonably satisfactory to
the Trustee (which shall include the statements set forth in Section 11.05
hereof) stating that, in the opinion of such counsel, all such conditions
precedent and covenants have been satisfied.
Section 11.05. Statements Required in Certificate or Opinion.
Each certificate or opinion with respect to compliance with a condition or
covenant provided for in this Indenture (other than a certificate provided
pursuant to TIA ss. 314(a)(4)) shall comply with the provisions of TIA ss.
314(e) and shall include:
(a) a statement that the Person making such certificate or opinion has read
such covenant or condition;
(b) a brief statement as to the nature and scope of the examination or
investigation upon which the statements or opinions contained in such
certificate or opinion are based;
(c) a statement that, in the opinion of such Person, he or she has made
such examination or investigation as is necessary to enable him or her to
express an informed opinion as to whether or not such covenant or condition has
been satisfied; and
(d) a statement as to whether or not, in the opinion of such Person, such
condition or covenant has been satisfied.
Section 11.06. Rules by Trustee and Agents.
The Trustee may make reasonable rules for action by or at a meeting of
Holders. The Registrar or Paying Agent may make reasonable rules and set
reasonable requirements for its functions.
Section 11.07. No Personal Liability of Directors, Officers, etc.
No director, officer, employee, partner, member, manager, incorporator or
stockholder of the Issuer or any of its Subsidiaries, as such, shall have any
liability for any obligations of the Issuer under the Notes, this Indenture or
the Security Documents 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 issuance of the Notes.
Section 11.08. Governing Law.
THE INTERNAL LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE
GENERAL OBLIGATIONS LAW) SHALL GOVERN AND BE USED TO CONSTRUE THIS INDENTURE AND
THE NOTES.
Section 11.09. No Adverse Interpretation of Other Agreements.
This Indenture may not be used to interpret any other indenture, loan or
debt agreement of the Issuer or its Subsidiaries or of any other Person. Any
such indenture, loan or debt agreement may not be used to interpret this
Indenture.
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Section 11.10. Successors.
All covenants and agreements of the Issuer in this Indenture and the Notes
shall bind its successors and assigns. All covenants and agreements of the
Trustee in this Indenture shall bind its successors and assigns.
Section 11.11. Severability.
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, and
in lieu of such invalid, illegal or unenforceable provision, a new provision
shall be inserted as similar in terms and commercial effect to such invalid,
illegal or unenforceable provision as may be possible and be valid, legal and
enforceable.
Section 11.12. Counterpart Originals.
The parties may sign any number of copies of this Indenture. Each signed
copy shall be an original, but all of them together represent the same
agreement.
Section 11.13. 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 of this Indenture and shall in no way
modify or restrict any of the terms or provisions hereof.
[The next page is the signature page]
-67-
SIGNATURES
Dated as of June __________, 2004
Issuer:
NATIONAL ENERGY & GAS TRANSMISSION, INC.
By:
----------------------------
Name:
Title:
Trustee:
WILMINGTON TRUST COMPANY
By:
----------------------------
Name:
Title:
[ACKNOWLEDGMENTS TO BE ADDED]
SCHEDULE A
UNRESTRICTED SUBSIDIARIES
USGen New England, Inc.
First Massachusetts Land Company, LLC
USGen Services Company, LLC
Lake Road Generating Company, L.P.
Lake Road Trust, Ltd.
Peach IV Power LLC
Black Hawk Power Corporation
La Paloma Power, LLC
La Paloma Generating Company, LLC
GenHoldings I, LLC
Osprey Power Corporation
Magnolia Power Corporation
Millennium Power Partners, L.P.
New Millenium Generating Company, LLC
Black Hawk Power Corporation
Peach I Power Corporation
Athens Generating Company, L.P.
New Athens Generating Company, LLC
Harquahala Power Corporation
Harquahala Generating Company, LLC
New Harquahala Generating Company, LLC
Covert Power Corporation
Covert Generating Company, LLC
New Covert Generating Company, LLC
Attala Power Corporation
Attala Generating Company, LLC
Attala Energy Company, LLC
NEGT Energy Trading Holdings, LLC
NEGT Energy Trading Holdings Corporation
NEGT Energy Trading - Gas Corporation
▇▇▇▇▇▇▇▇ Energy Management, Ltd. (Canada)
Virtual Credit Services, LLC
NEGT ET Investments Corporation
NEGT Energy Trading - Power, L.P.
NEGT ET Synfuel 166, LLC
NEGT ET Synfuel #2, LLC
NEGT International, Inc.
NEGT International Development Holdings, LLC
Gannet Power Corporation
Rocksavage Services I, Inc.
PG&E Overseas Holdings I, Ltd. (Cayman Islands)
PG&E Overseas Holdings II, Ltd. (Malaysia)
PG&E Corporation Australian Holdings Pty Ltd. (Australia)
PG&E Energy Trading Australia Pty Ltd. (Australia)
PG&E Corporation Australia Pty Ltd. (Australia)
Quantum Ventures
Energy Services Ventures, Inc.
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇▇, Inc.
Altresco, Inc.
Berkshire Feedline Acquisition, L.P.
Berkshire Pittsfield, Inc.
Buckeye Power Corporation
Citrus Generating Company, L.P.
Colstrip Energy Limited Partnership
▇▇▇▇▇▇'▇ ▇▇▇▇ Power Corporation
DPR, Inc.
Eucalyptus Power Corporation
Fellows Generating Company, L.P.
First Oregon Land Corporation
Gas Transmission Holdings Corporation
Gator Generating Company, ▇.▇.
▇▇▇▇▇ Power Corporation
J ▇▇▇▇▇▇▇▇ Associates, Inc.
J ▇▇▇▇▇▇▇▇ Pittsfield, Inc.
JMC Altresco, Inc.
Loon Power Corporation
▇▇▇▇▇ Generating Company
-2-
Merlin Power Corporation NEGT
Acquisition Company, LLC
NEGT Overseas, Inc.
Okeelanta Power Limited Partnership
Pacific Gas Transmission International, Inc.
Pelican Power Corporation
Pittsfield Partners, Inc.
Spruce Power Corporation
Spruce Limited Partnership
-3-
EXHIBIT A
(Face of Secured Tranche B Term Note)
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF
1933, AS AMENDED (THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED
OR OTHERWISE TRANSFERRED EXCEPT PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT
OR IN ACCORDANCE WITH AN APPLICABLE EXEMPTION FROM THE REGISTRATION REQUIREMENTS
OF THE SECURITIES ACT (SUBJECT TO THE DELIVERY OF SUCH EVIDENCE, IF ANY, AS MAY
BE REQUIRED UNDER THE INDENTURE PURSUANT TO WHICH THIS NOTE IS ISSUED) AND IN
ACCORDANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES
OR ANY OTHER JURISDICTION.(1)
Secured Tranche B Term Note due 2011
No. __ $____________________
CUSIP NO. 63580R AB 2
NATIONAL ENERGY & GAS TRANSMISSION, INC.
promises to pay to _________, or registered assigns, the principal sum of
_______________ Dollars ($______________) as set forth on the reverse hereof.
Interest Payment Dates: April 30 and October 31
Record Dates: April 15 and October 15
Dated: -------------------
NATIONAL ENERGY & GAS TRANSMISSION, INC.
By:
--------------------
This is one of the Secured
Tranche B Term Notes referred to in
the within-mentioned Indenture:
WILMINGTON TRUST COMPANY
as Trustee
By:
-------------------------
(Authorized Signatory)
---------------
(1) This legend should be imprinted only on Notes issued to Persons deemed to be
"underwriters" and ineligible to benefit from the Bankruptcy Code Section 1145
exceptions to the Securities Act registration requirements.
(Back of Note)
Secured Tranche B Term Note due 2011
THIS GLOBAL NOTE IS HELD BY THE DEPOSITORY (AS DEFINED IN THE INDENTURE
GOVERNING THIS NOTE) OR ITS NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL
OWNERS HEREOF AND IS NOT TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES
EXCEPT THAT (I) THE TRUSTEE MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED
PURSUANT TO SECTION 2.06 OF THE INDENTURE, (II) THIS GLOBAL NOTE MAY BE
EXCHANGED IN WHOLE BUT NOT IN PART PURSUANT TO SECTION 2.06(a) OF THE INDENTURE,
(III) THIS GLOBAL NOTE MAY BE DELIVERED TO THE TRUSTEE FOR CANCELLATION PURSUANT
TO SECTION 2.11 OF THE INDENTURE AND (IV) THIS GLOBAL NOTE MAY BE TRANSFERRED TO
A SUCCESSOR DEPOSITORY WITH THE PRIOR WRITTEN CONSENT OF THE ISSUER.(2)
Capitalized terms used herein shall have the meanings assigned to them in
the Indenture referred to below unless otherwise indicated.
1. PRINCIPAL. National Energy & Gas Transmission, Inc., a Delaware corporation,
or its successors (the "Issuer"), promises to pay the principal sum of ______
Dollars ($________) [or such other principal amount as shall be set forth in the
Schedule of Exchanges of Notes attached hereto(3)] on April 30, 2011.
This Note is also subject to redemption as set forth in paragraphs 6, 7 and
8 of this Note.
2. INTEREST. The Issuer promises to pay interest in cash on the principal amount
of this Note at a rate per annum equal to seven percent (7%), provided that, on
either or both of the first two Interest Payment Dates, in lieu of payment in
whole or in part of interest in cash on the Notes, the Issuer at its option may
pay interest on the Notes, in whole or in part, at a rate per annum equal to
nine percent (9%), through the issuance of additional Notes ("Secondary Notes")
in an aggregate principal amount equal to the amount of interest with respect to
such Notes at the rate then applicable as a result of the payment of such
interest by the issuance of Secondary Notes. All amounts not included in
Secondary Notes as a result of the rounding down to the nearest $1.00 of the
principal amount thereof, as provided in the Indenture, shall not carry forward
to a subsequent Interest Payment Date and shall be forever forfeited. The Issuer
will pay interest in United States dollars (except in the case of payment of
interest by the issuance of Secondary Notes as aforesaid) semiannually in
arrears on the last day of each April and October, commencing on October 31,
2004, or if any such day is not a Business Day, on the next succeeding Business
Day (each an "Interest Payment 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 date of issuance; provided, however, that if there is no existing
Default or Event of Default in the payment of interest, and if this Note is
authenticated between a record date referred to on the face hereof and the next
succeeding Interest Payment Date, interest shall accrue from such next
succeeding Interest Payment Date, except in the case of the original issuance of
the Notes
----------------
(2) This paragraph should be included only if the Note is issued as a Global
Note.
(3) The bracketed language should be included only if the Note is issued as a
Global Note.
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pursuant to the Plan, in which case interest shall accrue from the Effective
Date of the Plan. The Issuer shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue principal at a
rate equal to 2% per annum in excess of the then applicable interest rate on the
Notes to the extent lawful; it shall pay interest (including post-petition
interest in any proceeding under any Bankruptcy Law) on overdue installments of
interest (without regard to any applicable grace period) at the same rate to the
extent lawful. Notwithstanding the foregoing provisions, interest on the Notes
shall not exceed the maximum rate permitted by law.
3. METHOD OF PAYMENT. The Issuer will pay interest on the Notes (except
defaulted interest), if any, to the Persons who are registered Holders at the
close of business on the April 15 or October 15 next preceding the Interest
Payment Date, even if such Notes are cancelled after such record date and on or
before such Interest Payment Date, except as provided in Section 2.12 of the
Indenture with respect to defaulted interest. The Notes shall be payable as to
principal, premium, if any, and interest at the office or agency of the Issuer
maintained for such purpose within or without The City of New York, or, at the
option of the Issuer, payment of interest may be made by check mailed to the
Holders at their addresses set forth in the register of Holders; provided that
payment by wire transfer of immediately available funds shall be required with
respect to principal of, premium, if any, and interest (except interest being
paid by the issuance of Secondary Notes) on all Global Notes and all other Notes
the Holders of which shall have provided written wire transfer instructions to
the Issuer or the Paying Agent. Such payment shall be in such coin or currency
of the United States of America as at the time of payment is legal tender for
the payment of public and private debts, except in the case of interest being
paid by the issuance of Secondary Notes.
4. PAYING AGENT AND REGISTRAR. Initially, Wilmington Trust Company, the Trustee
under the Indenture, shall act as Paying Agent and Registrar. The Issuer may
change any Paying Agent or Registrar without notice to any Holder. The Issuer or
any of its Subsidiaries may act in any such capacity.
5. INDENTURE. The Issuer issued the Notes under an Indenture dated as of June
__, 2004 (the "Indenture") between the Issuer and the Trustee. The terms of the
Notes include those stated in the Indenture and those made a part of the
Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S.C.
▇▇.▇▇. 77aaa-77bbbb) (the "TIA"). The Notes are subject to all such terms, and
Holders are referred to the Indenture and such Act for a statement of such
terms. The Notes are limited to $500,000,000 (plus the principal amount of any
Secondary Notes) in aggregate principal amount, except as otherwise provided in
the Indenture.
6. OPTIONAL REDEMPTION.
(a) Except as set forth in subparagraph (b) below, the Notes shall not be
redeemable at the Issuer's option prior to April 30, 2007. Thereafter, the Notes
shall be redeemable at the option of the Issuer, in whole at any time or in part
from time to time, upon not less than 30 nor more than 60 days' notice, at the
redemption prices (expressed as percentages of principal amount) set forth below
plus accrued and unpaid interest thereon, if any, to the applicable redemption
date, if redeemed during the twelve-month period beginning on April 30 of the
years indicated below:
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PERCENTAGE
YEAR
2007 ..................................................................103.50%
2008 ..................................................................101.75%
2009 and thereafter ...................................................100.00%
(b) Notwithstanding foregoing, at any time within 75 days after the date as
of which the Issuer has knowledge of the occurrence of a Change of Control, the
Issuer may, but shall in no event be required to, redeem 100% but not less than
100% of the outstanding Notes at a redemption price equal to 101% of the
principal amount of the Notes, plus accrued and unpaid interest thereon, if any,
to the redemption date.
7. REDEMPTION OUT OF EXCESS CASH FLOW. The Notes are subject to mandatory
redemption by the Issuer on April 30 and October 31 of each year (or, if
financial statements for the period ended on the preceding December 31 or June
30, as the case may be, have not been provided to the Trustee pursuant to
Section 4.03 of the Indenture, on the date that is 30 days after the date of
delivery of such financial statements), with the first such payment to be made
on April 30, 2005 out of Excess Cash Flow at a redemption price equal to 100% of
the principal amount of the Notes to be redeemed, plus accrued and unpaid
interest, if any, thereon to the redemption date. Notwithstanding the foregoing,
the Issuer shall not be required to redeem Notes pursuant to this paragraph 7 on
any such date out of Excess Cash Flow that is less than $1,000,000. Any
redemption of Notes pursuant to this paragraph 7 shall be made on a pro rata
basis (based on principal amounts outstanding) with any redemption of Tranche A
Notes then required to be made pursuant to Section 3.08 of the Tranche A
Indenture.
8. REDEMPTION OUT OF NET PROCEEDS OF PRINCIPAL ASSET SALES. The Notes are
subject to mandatory redemption by the Issuer within 30 days after the receipt
by the Issuer of Net Proceeds from any Principal Asset Sale, after application
of such Net Proceeds first to the payment of any unpaid fees and expenses of the
Collateral Agent under the Intercreditor Agreement and then to the payment of
all amounts then required to be paid pursuant to any New Credit Facility (but
without being required hereby to effect a permanent reduction of the commitment
under such facility), second to fund Cash on Hand and third to the payment of
any unpaid fees and expenses of the Trustee under the Indenture. The Notes shall
be so redeemed upon not less than 10 or more than 20 days' notice at a
redemption price equal to the principal amount thereof to be redeemed, plus
accrued and unpaid interest thereon, if any, to the redemption date.
Notwithstanding the foregoing provisions, (i) if the Issuer receives Net
Proceeds from a Principal Asset Sale on or prior to the Initial Distribution
Date (as such term is defined in the Plan), the date by which the redemption
required hereby as a result of the receipt of such Net Proceeds shall occur
shall be 30 days after such receipt or, if later, the date that is 15 days after
the Initial Distribution Date; (ii) the Issuer shall not redeem Notes pursuant
to this paragraph 8 unless it has theretofore redeemed, or redeems concurrently
with a redemption of Notes pursuant to this paragraph 8, all of the outstanding
Tranche A Notes pursuant to and in accordance with the provisions of Section
3.09 of the Tranche A Indenture; and (iii) the Issuer shall not be required to
redeem Notes pursuant to this paragraph 8 out of Net Proceeds of any Principal
Asset Sale (except following the final distribution of such Net Proceeds) that
are received subsequent to the initial receipt of Net Proceeds from such Asset
Sale unless such
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subsequently received Net Proceeds, together with all other Net Proceeds not
theretofore applied pursuant to this paragraph 8, exceed $1,000,000.
The Issuer shall not be required to make mandatory redemption payments
(except pursuant to paragraph 7 above or this paragraph 8) or sinking fund
payments with respect to the Notes.
9. NOTICE OF REDEMPTION. Except as otherwise provided in paragraph 8 above,
notice of redemption shall be mailed at least 30 days but not more than 60 days
before the redemption date to each Holder whose Notes are to be redeemed at its
registered address. Notes in denominations larger than $1,000 may be redeemed in
part but only in whole multiples of $1,000, unless all of the Notes held by a
Holder are to be redeemed. On and after the redemption date, interest, if any,
ceases to accrue on the Notes or portions thereof called for redemption, unless
the Issuer defaults in making such redemption payment.
10. PURCHASE AT OPTION OF HOLDER. Upon the occurrence of a Change of Control of
which the Issuer has knowledge, each Holder shall have the right to require the
Issuer to purchase all or any part (equal to $1,000 or an integral multiple
thereof) of such Holder's Notes pursuant to the offer described below (the
"Change of Control Offer") at an offer price in cash equal to 101% of the
aggregate principal amount thereof to the date of purchase. Within 30 days after
the date as of which the Issuer has knowledge of the occurrence of a Change of
Control, the Issuer shall mail a notice to each Holder describing the
transaction or transactions that constituted the Change of Control and offering
to purchase Notes on the date specified in such notice. The notice shall contain
all instructions and information necessary to enable Holders to tender Notes
pursuant to the Change of Control Offer, pursuant to the procedures required by
the Indenture.
Notwithstanding the foregoing provisions, the Issuer shall not be required
(i) to make a Change of Control Offer if prior to the date as of which the
Issuer would otherwise be required to mail such notice the Issuer has given or
caused to be given a notice of redemption of the Notes pursuant to subparagraph
(b) of paragraph 6 above or (ii) to purchase Notes pursuant to any such notice
of a Change of Control Offer if the Issuer shall redeem the Notes pursuant to
such subparagraph. The Issuer shall not be required to make a Change of Control
Offer upon a Change of Control if a third party makes the Change of Control
Offer in the manner, at the times and otherwise in compliance with the
requirements set forth in the Indenture applicable to a Change of Control Offer
made by the Issuer and purchases all Notes validly tendered and not withdrawn
under such Change of Control Offer.
11. DENOMINATIONS, TRANSFER, EXCHANGE. The Notes are in registered form without
coupons. The transfer of the Notes may be registered and the Notes may be
exchanged as provided in the Indenture. The Registrar and the Trustee may
require a Holder, among other things, to furnish appropriate endorsements and
transfer documents, and the Issuer may require a Holder to pay any taxes and
fees required by law or permitted by the Indenture. The Issuer need not exchange
or register the transfer of any Note or portion of a Note selected for
redemption, except for the unredeemed portion of any Note being redeemed in
part. Also, it need not exchange or register the transfer of any Notes for a
period of 15 days before the mailing of a notice of redemption of Notes or
during the period between a record date and the corresponding
A-5
Interest Payment Date. Definitive Notes (other than Secondary Notes) shall be in
denominations of $1,000 and integral multiples thereof, except as otherwise
permitted pursuant to Section 2.01(b) or 2.06(d)(ix) of the Indenture. Nothing
in the Indenture or the Notes shall prevent or be deemed to prevent Participants
or Indirect Participants from holding beneficial interests in a Global Note in
denominations of $1.00 or integral multiples thereof, provided that each Note or
Notes issued upon any registration of transfer or exchange of any Note (other
than Secondary Notes), or pursuant to Section 2.10, Section 3.06 or 3.10(g) of
the Indenture, shall be issued in denominations of $1,000 or integral multiples
thereof, except that not more than one (1) new Note so being issued in respect
of the Note being surrendered (the "surrendered Note") may be in a denomination
that is not $1,000 or an integral multiple thereof. Notes (other than Secondary
Notes) may not be surrendered for combination into a Note with a principal
amount that is not $1,000 or an integral multiple thereof.
12. PERSONS DEEMED OWNERS. The registered Holder of a Note may be treated as its
owner for all purposes, subject to the provisions of the Indenture and the Notes
relating to record dates for the payment of interest.
13. AMENDMENT, SUPPLEMENT AND WAIVER. Subject to the following paragraphs, the
Indenture and 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
(including consents obtained in connection with a tender offer or exchange offer
for the Notes), and any existing Default or Event of Default (other than a
Default or Event of Default in the payment of the principal of, premium, if any,
or interest on the Notes, except a payment default resulting from an
acceleration that has been rescinded) or compliance with any provision of the
Indenture or the Notes may be waived with the consent of the Holders of a
majority in principal amount of the then outstanding Notes (including consents
obtained in connection with a tender offer or exchange offer for the Notes).
Without the consent of any Holder, the Issuer and the Trustee may amend or
supplement the Indenture or the Notes to cure any ambiguity, defect or
inconsistency; to provide for uncertificated Notes in addition to or in place of
certificated Notes; to provide for the assumption and discharge of the Issuer's
obligations to Holders in the case of a merger or consolidation pursuant to
Article 5 of the Indenture; to make changes in the Security Documents determined
by the Issuer to be necessary or appropriate in connection with the execution
and delivery by the Issuer of the initial New Credit Facility, subject to
certain limitations set forth in the Indenture; to make any change that would
provide any additional rights or benefits to the Holders or that does not
adversely affect the legal rights under the Indenture of any such Holder; or to
comply with requirements of the Commission in order to effect or maintain the
qualification of the Indenture under the TIA.
14. DEFAULTS AND REMEDIES. Events of Default include (i) default for 30 days in
the payment when due of interest on the Notes; (ii) default in payment when due
of the principal of or premium, if any, on the Notes; (iii) failure of the
Issuer for 30 days after notice to comply with Section 4.15 or Article 5 of the
Indenture; (iv) failure of the Issuer for 45 days after notice to comply with
any of its other agreements in the Indenture, the Notes or the Security
Documents; or any of the representations and warranties made by the Issuer in
the Pledge Agreement or the Intercreditor Agreement shall have been untrue in
any material respect when made; (v) (x)
A-6
default under the New Credit Facility entered into in connection with the
implementation of the Plan, or under any other New Credit Facility under which
Indebtedness outstanding, together with any additional amount that may be
borrowed thereunder, aggregate at the time of determination at least $10 million
in principal amount, and such event of default continues for thirty 30 days; or
(y) default under any mortgage, indenture or instrument under which there may be
issued or by which there may be secured or evidenced any Indebtedness for money
borrowed by the Issuer or any of its Restricted Subsidiaries (or the payment of
which is Guarantied by the Issuer or any of its Restricted Subsidiaries) (other
than, in each such case, Non-Recourse Debt), or Indebtedness referred to in item
(xvi) of the second paragraph of Section 4.09 of the Indenture), whether such
Indebtedness or Guaranty now exists or is created after the date of the
Indenture (but not including Indebtedness referred to in clause (x) of this
paragraph 14), which default referred to in this clause (y) is caused by a
failure to pay principal at final maturity or results in the acceleration of
such Indebtedness prior to its Stated Maturity and, in each case, the principal
amount of any such Indebtedness, together with the principal amount of any other
such Indebtedness the Stated Maturity of which has been so accelerated,
aggregates $10 million or more; (vi) failure by the Issuer or its Significant
Subsidiaries to pay final judgments (not subject to appeal) aggregating in
excess of $10 million, which judgments are not paid, discharged or stayed for a
period of 45 days after the same have become final; or (vii) certain events of
bankruptcy or insolvency with respect to the Issuer or any of its Significant
Subsidiaries or any group of Subsidiaries that, taken as a whole, would
constitute a Significant Subsidiary, or failure of the Trustee to have a valid
and perfected Lien on any Collateral, subject only to Permitted Liens.
15. INTERCREDITOR AGREEMENT. This Note is subject to the terms of the
Intercreditor Agreement, and in the event of any conflict or inconsistency
between the provisions of this Note and the provisions of the Intercreditor
Agreement, the provisions of the Intercreditor Agreement shall control.
16. TRUSTEE DEALINGS WITH THE ISSUER. The Trustee, in its individual or any
other capacity, may make loans to, accept deposits from and perform services for
the Issuer, its Subsidiaries or Affiliates, and may otherwise deal with the
Issuer, its Subsidiaries or Affiliates, as if it were not the Trustee.
17. NO RECOURSE AGAINST OTHERS. No director, officer, employee, partner, member,
manager, incorporator or stockholder of the Issuer or any of its Subsidiaries or
Affiliates, as such, shall have any liability for any obligations of the Issuer
under the Notes, the Indenture or the Security Documents, 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 issuance of the Notes.
18. AUTHENTICATION. This Note shall not be valid until authenticated by the
manual signature of the Trustee or an authenticating agent.
19. 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).
A-7
20. CUSIP NUMBERS. Pursuant to a recommendation promulgated by the Committee on
Uniform Security Identification Procedures, the Issuer has caused CUSIP numbers
to be printed on the Notes, and the Trustee may use CUSIP numbers in notices of
redemption as a convenience to the Holders. No representation is made as to the
accuracy of such numbers either as printed on the Notes or as contained in any
notice of redemption, and reliance may be placed only on the other
identification numbers placed thereon.
The Issuer shall furnish to any Holder upon written request and without
charge a copy of the Indenture. Requests may be made to:
National Energy & Gas Transmission, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Secretary
[Balance of page intentionally remains blank]
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ASSIGNMENT FORM
To assign this Note, fill in the form below: (I) or (we) assign and
transfer this Note to
--------------------------------------------------------------------------------
(Insert assignee's Soc. Sec. or Tax I.D. No.)
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
(Print or type assignee's name, address and zip code)
and irrevocably appoint --------------------------------------------------------
to transfer this Note on the books of the Issuer. The agent may substitute
another to act for it.
--------------------------------------------------------------------------------
Date:
-----------------------
Your Signature:
--------------------------------------------
(Sign exactly as your name appears on the face of this Note)
Signature Guarantee*:
* Signature must be guaranteed by an eligible guarantor institution within
the meaning of Securities and Exchange Commission Rule 17Ad-15 (including
banks, stock brokers, savings and loan associations, national securities
exchanges, registered securities associations, clearing agencies and credit
unions) with membership or participation in an approved signature guarantee
medallion program if this Note is to be delivered other than to, and in the
name of, the registered holder.
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OPTION OF HOLDER TO ELECT PURCHASE
If you want to elect to have this Note purchased by the Issuer pursuant to
Section 4.15 of the Indenture, check the following box. [ ]
If you want to elect to have only part of the Note purchased by the Issuer
pursuant to Section 4.15 of the Indenture, state the amount you elect to have
purchased:
$
--------------
Date: Your Signature:
-------------------- --------------------------------
(Sign exactly as your name appears on the Note)
Tax Identification No.:
------------------------
Signature Guarantee.*
* Signature must be guaranteed by an eligible guarantor institution within
the meaning of Securities and Exchange Commission Rule 17Ad-15 (including
banks, stock brokers, savings and loan associations, national securities
exchanges, registered securities associations, clearing agencies and credit
unions) with membership or participation in an approved signature guarantee
medallion program if this Note is to be delivered other than to, and in the
name of, the registered holder.
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SCHEDULE OF EXCHANGES OF NOTES(4)
THE FOLLOWING EXCHANGES OF A PART OF THIS GLOBAL NOTE FOR
OTHER NOTES HAVE BEEN MADE:
--------------------------------------------------------------------------------------------------------------
Principal Amount of
Amount of decrease in Amount of increase in this Global Note Signature of authorized
Principal Amount of Principal Amount of following such signatory of Trustee or
Date of Exchange this Global Note this Global Note decrease (or increase) Note Custodian
---------------- ---------------- ---------------- ---------------------- --------------
--------------------------------------------------------------------------------------------------------------
--------------
(4) This should be included only if the Note is issued as a Global Note.
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DRAFT AS OF 06.21.04
EXHIBIT B
---------
********************************************************************************
NATIONAL ENERGY & GAS TRANSMISSION, INC.
and
WILMINGTON TRUST COMPANY,
as Trustee
PLEDGE AGREEMENT
Dated as of ___, 2004
SECURED TRANCHE B TERM NOTES DUE 2011
********************************************************************************
TABLE OF CONTENTS
Page
Section 1. Definitions........................................................................................1
Section 2. Representations and Warranties.....................................................................3
Section 3. Security Interest..................................................................................6
3.01 Grant of Security Interest.........................................................................6
3.02 Company Remains Liable.............................................................................7
Section 4. Certain Covenants and Agreements...................................................................7
Section 5. Declaration of Trust; Other Provisions Concerning the Collateral..................................11
5.01 Declaration and Acceptance of Trust...............................................................11
5.02 Right to Make Advances............................................................................12
5.03 Release of Collateral.............................................................................12
5.04 Purchaser Protected...............................................................................13
5.05 Powers Exercisable by Receiver or Trustee.........................................................13
Section 6. ▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇, Etc..........................................................................13
Section 7. Trust Moneys......................................................................................14
7.01 Trust Moneys......................................................................................14
7.02 Withdrawal of Certain Trust Moneys................................................................15
7.03 Application of Trust Moneys upon Event of Default.................................................15
Section 8. Remedies, Etc.....................................................................................15
8.01 Event of Default..................................................................................15
8.02 Deficiency........................................................................................17
8.03 Removals, Etc.....................................................................................17
8.04 Private Sale......................................................................................17
8.05 Termination.......................................................................................17
Section 9. The Trustee's Appointment as Attorney-in-Fact.....................................................18
9.01 Appointment as Attorney-in-Fact...................................................................18
Section 10. Intercreditor Agreement...........................................................................19
10.01 Intercreditor Agreement Controls..................................................................19
Section 11. Certain Provisions with respect to Remedies; Marshaling Pledged Equity Interest...................19
Section 12. Security Interest Absolute........................................................................20
Section 13. Miscellaneous.....................................................................................22
13.01 No Waiver.........................................................................................22
i
13.02 Notices...........................................................................................22
13.03 Expenses..........................................................................................22
13.04 Amendments, Etc...................................................................................22
13.05 Successors and Assigns............................................................................22
13.06 Captions..........................................................................................23
13.07 Counterparts......................................................................................23
13.08 Governing Law.....................................................................................23
13.09 SUBMISSION TO JURISDICTION; SERVICE OF PROCESS....................................................23
JURY TRIAL........................................................................................23
13.10 Reinstatement.....................................................................................24
13.11 Severability......................................................................................24
13.12 No Limitation upon Indenture; Provisions for Benefit of Trustee...................................24
SCHEDULE A Issuers
SCHEDULE B Pledged Equity Interests
SCHEDULE C Filings
EXHIBIT A Form of Pledge Supplement
EXHIBIT B Form of Irrevocable Proxy
EXHIBIT C Form of Partnership/Limited Liability
Company/Stock/Trust Power
ii
PLEDGE AGREEMENT
PLEDGE AGREEMENT dated as of __________, 2004 (this "Agreement") between
NATIONAL ENERGY & GAS TRANSMISSION, INC., a Delaware corporation (the
"Company"), and WILMINGTON TRUST COMPANY, a Delaware banking corporation, as
trustee under the within-mentioned Indenture.
Pursuant to an Indenture dated as of the date hereof (as the same may be
amended, supplemented or otherwise modified and in effect from time to time, the
"Indenture") between the Company and Wilmington Trust Company, as trustee (the
"Trustee"), the Company has authorized the issuance of up to $500,000,000
principal amount of its Secured Tranche B Term Notes due 2011 (the "Notes").
Pursuant to an Indenture dated as of the date hereof (as the same may be
amended, supplemented or otherwise modified and in effect from time to time, the
"Tranche A Indenture") between the Company and The Bank of New York, as trustee
(the "Tranche A Trustee"), the Company has authorized the issuance of up to
$500,000,000 principal amount of its Secured Tranche A Term Notes due 2011 (the
"Tranche A Notes").
To induce the holders of the Notes to accept such Notes upon their issuance
under the Indenture, the Company has agreed to pledge and grant a security
interest in the Collateral (as hereinafter defined) as security for the Secured
Obligations (as hereafter defined).
Concurrently with the execution and delivery of this Agreement, the Company
is entering into a Pledge Agreement with the Tranche A Trustee pursuant to which
the Company agrees to pledge and grant a security interest in the Collateral as
security for the Secured Obligations (as such term is defined in the Tranche A
Pledge Agreement, as defined below) (such Pledge Agreement, as the same may be
amended, supplemented or otherwise modified and in effect form time to time, the
"Tranche A Pledge Agreement").
Concurrently with the execution and delivery of this Agreement, the Company
is entering into a Collateral Agency and Intercreditor Agreement (as such term
is defined in the Indenture), which provides for, among other things, the
relative priorities of the pledges and security interests created pursuant to
this Agreement and the Tranche A Pledge Agreement and the pledges and security
interests securing certain other obligations of the Company.
Accordingly, in consideration of the foregoing and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
Section 1. Definitions. Terms used but not defined herein have the
respective meanings assigned to such terms in the Indenture. In addition, as
used herein:
"Collateral" has the meaning ascribed thereto in Section 3.01 hereof.
"Collateral Agent" has the meaning set forth in the Intercreditor
Agreement.
"Deposited Funds" has the meaning ascribed thereto in Section 5.03 hereof.
"Issuers" means (i) the Persons identified on Schedule A hereto and (ii)
any other Person (x) incorporated or formed as a Restricted Subsidiary of the
Company, or that first became a Restricted Subsidiary of the Company, after the
date hereof and (y) that has total assets as of the last day of any fiscal
quarter of the Company with a fair market value (determined in good faith by the
Board of Directors) in excess of $500,000, provided that a Restricted Subsidiary
of the Company incorporated or formed after the date hereof pursuant to or in
connection with a transaction provided for in an IPP Sale Agreement shall not be
an Issuer for purposes of this Agreement, provided further that any Restricted
Subsidiary referred to in this proviso shall become an Issuer for purposes of
this Agreement if, as a result of any change in or the termination of such IPP
Sale Agreement, such Subsidiary shall have no further role in the transactions
provided for in such Agreement.
"Pledge Supplement" means any supplement to this Agreement in substantially
the form of Exhibit A hereto.
"Pledged Equity Interests" means all Pledged Stock, Pledged LLC Interests,
Pledged Partnership Interests and Pledged Trust Interests.
"Pledged LLC Interests" means all interests in any Issuer that is a limited
liability company, including, without limitation, all limited liability company
interests listed on Schedule B hereto (as such schedule may be amended or
supplemented from time to time) and the certificates representing such limited
liability company interests and any interest of the Company in entries on the
books and records of such limited liability company in respect of such interests
and all dividends, distributions, cash, warrants, rights, options, instruments,
securities and other property or proceeds from time to time received, receivable
or otherwise distributed in respect of or in exchange for any or all of such
limited liability company interests, together with all voting rights and powers
and other incidents of ownership appertaining to such limited liability company
interests.
"Pledged Partnership Interests" means all interests in any Issuer that is a
general partnership, limited partnership, limited liability partnership or other
partnership, including, without limitation, all partnership interests listed on
Schedule B hereto (as such schedule may be amended or supplemented from time to
time) and the certificates representing such partnership interests and any
interest of the Company in entries on the books and records of such partnership
in respect of such interests and all dividends, distributions, cash, warrants,
rights, options, instruments, securities and other property or proceeds from
time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such partnership interests, together with all voting
rights and powers and other incidents of ownership appertaining to such
partnership interests.
"Pledged Stock" means all shares of capital stock of any Issuer that is a
corporation, including, without limitation, all shares of capital stock
described on Schedule B hereto (as such schedule may be amended or supplemented
from time to time), and the certificates representing such shares and any
interest of the Company in entries on the books of such corporation in respect
of such shares and all dividends, distributions, cash, warrants, rights,
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options, instruments, securities and other property or proceeds from time to
time received, receivable or otherwise distributed in respect of or in exchange
for any or all of such shares, together with all voting rights and powers and
other incidents of ownership appertaining to such shares.
"Pledged Trust Interests" means all interests in any Issuer that is a
Delaware business trust or other trust, including, without limitation, all trust
interests listed on Schedule B hereto (as such schedule may be amended or
supplemented from time to time), but not including any trust established
pursuant to the Plan, and the certificates representing such trust interests and
any interest of the Company in entries on the books and records of such trust in
respect of such interests and all dividends, distributions, cash, warrants,
rights, options, instruments, securities and other property or proceeds from
time to time received, receivable or otherwise distributed in respect of or in
exchange for any or all of such trust interests, together with all voting rights
and powers and other incidents of ownership appertaining to such trust
interests.
"Secured Obligations" means, collectively, (i) all present and future
obligations of the Company under the Indenture and the Notes, including in
respect of the principal of, and interest (including interest accruing after the
occurrence and continuance of any Default, whether or not a claim for
post-filing or post-petition interest is allowed or allowable under applicable
law following the institution of any Insolvency or Liquidation Proceeding) and
premium, if any, on, the Notes, purchase price of the Notes, fees, reimbursement
and indemnification obligations (including fees and expenses of the Trustee
payable under the Indenture and the Security Documents) and all other amounts
outstanding under the Indenture or the Notes (including all such amounts which
would become due but for the operation of the automatic stay under Section
362(a) of the United States Bankruptcy Code or the operation of Sections 502(b)
and 506(b) of the United States Bankruptcy Code), and (ii) all present and
future obligations of the Company under this Agreement or the other Security
Documents, in each case as the same may be amended, supplemented or otherwise
modified and in effect from time to time.
"Trust Moneys" means all cash or cash equivalents received by the Trustee
hereunder in respect of the Collateral (i) in exchange for the release of
Collateral from the Lien of this Agreement, (ii) as proceeds of any sale or
other disposition of all or any part of the Collateral by or on behalf of the
Trustee or any collection, recovery, receipt, appropriation or other realization
of or from all or any part of the Collateral pursuant to this Agreement or the
other Security Documents or otherwise or (iii) otherwise as security for the
Secured Obligations.
"Uniform Commercial Code" or "UCC" means the Uniform Commercial Code as in
effect from time to time in any jurisdiction whose law governs the document in
which such term is used and/or the rights thereunder.
Section 2. Representations and Warranties. The Company represents and
warrants to the Trustee that:
(a) Organization, Etc. The Company is (i) a corporation duly organized
and validly existing and in good standing under the laws of the State of
Delaware and has full power and authority, and holds all requisite
governmental licenses, permits and other approvals, necessary to enter into
and perform its
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obligations under this Agreement, (ii) duly qualified to do business and in
good standing in each other jurisdiction where the character of its
properties or the nature of its activities makes such qualification
necessary and (iii) has the requisite power and authority to own the
Pledged Equity Interests.
(b) Due Authorization, Non-Contravention, Etc. The execution, delivery
and performance by the Company of this Agreement and the transactions
contemplated thereby have been duly authorized by all necessary corporate
action on the part of the Company and do not contravene any contractual
restriction, court decree or order or law or governmental regulation, in
each case binding on the Company.
(c) Governmental Approvals, Etc. No authorization or approval or other
action by, and no notice to or filing with, any governmental authority is
required for the grant by the Company of the security interest granted
hereby or the due execution, delivery or performance by the Company of this
Agreement other than (i) filings and recordings in respect of the Liens
created hereunder, (ii) those that have been, or on the date of this
Agreement will be, duly obtained or made and will be in full force and
effect, (iii) those required under applicable securities laws in connection
with a disposition of Collateral and (iv) those necessary in connection
with any transaction contemplated by Section 4(k) hereof.
(d) Validity, Etc. This Agreement constitutes the legal, valid and
binding obligation of the Company, enforceable against it in accordance
with its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally or by general principles of equity.
(e) Ownership. The Company is the sole legal, record and beneficial
owner of the Collateral existing on the date hereof in which it purports to
grant a security interest pursuant to Section 3.01 hereof, and no Lien
exists or will exist upon such Collateral at any time (and no right or
option to acquire the same exists or will exist in favor of any other
Person), except for Permitted Liens. No effective financing statement or
other instrument similar in effect covering all or any part of the Pledged
Equity Interests and made or consented to by the Company, or of which the
Company otherwise has knowledge, is on file in any recording office, except
such as may have been filed in favor of the Trustee, the Tranche B Trustee,
any lender or agent under a New Credit Facility or the Collateral Agent.
(f) Pledged Equity Interests. The Pledged Equity Interests identified
on Schedule B hereto constitute, on the date hereof, all of the issued and
outstanding shares of capital stock or other ownership interests of any
class or character of the Issuers identified on Schedule A hereto, and
Schedule B correctly sets forth, as at the date hereof, the information
called for by such Schedule with respect to all such Pledged Equity
Interests. There are no outstanding voting
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agreements with respect to any Pledged Equity Interests. The Issuers do not
have outstanding (i) any securities convertible into or exchangeable for
their Equity Interests, or (ii) any rights to subscribe for or to purchase,
or any options, warrants or other rights to acquire, Equity Interests or
securities convertible into or exchangeable or exercisable for Equity
Interests, and there are no agreements, arrangements or understandings to
which the Company is a party providing for the issuance (contingent or
otherwise) of, or any calls, commitments or claims of any character
relating to, any Equity Interests.
(g) Perfection and Priority. The security interest granted pursuant to
this Agreement will constitute a valid and continuing perfected security
interest in favor of the Trustee, for the ratable benefit of the Holders,
in the Collateral existing as of the date hereof for which perfection is
governed by the Uniform Commercial Code upon (i) the completion of the
filings and other actions specified on Schedule C hereto (which have been
delivered to the Trustee in completed form) and (ii) proof of the delivery
to the Trustee of each Security Certificate described in Section 2(i)
below, in each case together with an executed irrevocable proxy (in the
form of Exhibit B hereto) and an undated partnership/limited liability
company/stock/trust power executed in blank (in the form of Exhibit C
hereto). Such security interest will be prior to all other Liens on the
Collateral except for Permitted Liens which have priority over the Lien of
this Agreement by operation of law or otherwise as permitted under the
Indenture or the Intercreditor Agreement.
(h) Chief Executive Office. On the date hereof, the location of the
Company's chief executive office, where the Company maintains its records
relating to the Pledged Equity Interests, is ▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇.
(i) Governed by Article 8. Each of the Pledged Equity Interests
existing as of the date hereof is represented by a Security Certificate (as
defined in Section 8-102(a)(16) of the UCC) in registered form (the
transfer of which may be registered upon books maintained by the Issuer
thereof) and by its terms (as evidenced by a legend attached to such
Security Certificate and, in the case of an Issuer that is a partnership or
a limited liability company, in the organizational documents pursuant to
which such Equity Interest is issued) provides that it is a security
governed by Article 8 of the UCC.
(j) No Defense; Total Pledged Equity Interests The Pledged Equity
Interests are not subject to any defense, offset or counterclaim, nor, to
the knowledge of the Company, has any of the foregoing been asserted or
alleged against it by any Person. There are no certificates, instruments,
documents or other writings (other than the organizational documents of the
Issuers) of any Issuer which evidence any Pledged Equity Interests of such
Issuer other than the Security Certificates evidencing the Pledged Equity
Interests, the originals of which are being delivered to the Trustee on the
date hereof.
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Section 3. Security Interest.
3.01 Grant of Security Interest. As collateral security for the payment in
full and performance when due (whether at stated maturity, by acceleration or
otherwise) of the Secured Obligations, the Company hereby assigns, conveys,
mortgages, pledges, hypothecates, transfers and grants to the Trustee, for the
ratable benefit of the Holders, as hereinafter provided, a continuing lien on
and continuing security interest in all of the Company's right, title and
interest in, to and under to the following property, whether now owned by the
Company or hereafter acquired and whether now existing or hereafter coming into
existence (collectively the "Collateral"):
(a) all Pledged Equity Interests;
(b) all shares, securities, moneys or property representing a dividend
on any of the Pledged Equity Interests, or representing a distribution or
return of capital upon or in respect of the Pledged Equity Interests, or
resulting from a split-up, combination, reclassification or other like
change of the Pledged Equity Interests or otherwise received in exchange
therefor;
(c) without limiting the general applicability of subsections (a) and
(b) above, in the event of any consolidation or merger in which any Issuer
is not the surviving entity, all ownership interests held by the Company of
any class or character in the successor entity formed by or resulting from
such consolidation or merger;
(d) all payments due or to become due to the Company in respect of
such Pledged Equity Interests, whether under the constitutive documents of
any Issuer or otherwise;
(e) all of the Company's claims, rights, powers, privileges,
authority, options, security interests, liens and remedies, if any, under
the constitutive documents of any Issuer or at law or otherwise, in each
case in respect of such Pledged Equity Interests;
(f) all of the Company's rights under the constitutive documents of
any Issuer or at law to exercise and enforce every right, power, remedy,
authority, option and privilege of the Company relating to the Pledged
Equity Interests, including any power to terminate, cancel or modify the
constitutive documents of any Issuer, to execute any instruments and to
take any and all other action on behalf of and in the name of any Issuer in
respect of the Pledged Equity Interests and to make determinations, to
exercise any election (including, but not limited to, election of remedies)
or option or to give or receive any notice, consent, amendment, waiver or
approval in respect thereof, together with full power and authority to
demand, receive, enforce, collect or receipt for any of the foregoing or
for any Pledged Equity Interests, to enforce or execute any checks, or
other instruments or orders, to file any claims and to take any action in
connection with any of the foregoing;
(g) all interests in substitution for or in addition to any of the
foregoing, any certificates representing or evidencing such interests and
all cash, securities, distributions and other property at any time and from
time to time received, receivable or otherwise distributed in respect of or
in exchange for any or all of the foregoing; and
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(h) all proceeds of and to any of the property described in any of
subsections (a) through (g) above (including all Trust Moneys) and, to the
extent related to any property described in any such subsection or such
proceeds, all books and other papers in the possession or under the control
of the Company, including, without limitation, proceeds as defined in
Section 9-102(a)(64) of the Uniform Commercial Code, including whatever is
received upon any sale, exchange, collection or other disposition of any of
the Collateral, and any property into which any of the Collateral is
converted, whether cash or noncash proceeds, and any and all other amounts
paid or payable under or in connection with any of the Collateral.
3.02 Company Remains Liable. Anything contained herein to the contrary
notwithstanding:
(a) The Company shall remain liable under any partnership agreement or
limited liability company agreement relating to any Pledged Partnership
Interest or Pledged LLC Interest or any other agreement of the Company
relating to the Collateral, to the extent set forth herein or therein, to
perform all of its duties and obligations thereunder to the same extent as
if this Agreement had not been executed;
(b) the exercise by the Trustee of any of its rights hereunder shall
not release the Company from any of its duties or obligations under any
such agreement; and
(c) neither the Trustee nor any Holder, nor any purchaser at a
foreclosure sale under this Agreement, shall have any obligation or
liability under any partnership agreement or limited liability company
agreement relating to any Pledged Partnership Interest or Pledged LLC
Interest or any other agreement of the Company relating to the Collateral
by reason of this Agreement, nor shall the Trustee or any Holder or any
such purchaser be obligated to perform any of the obligations or duties of
the Company thereunder or to take any action to collect or enforce any
claim for payment thereunder.
Section 4. Certain Covenants and Agreements. The Company hereby
covenants and agrees that:
(a) without the prior written consent of the Trustee, it shall not
vote or consent or take any other action to: (i) amend or terminate any
partnership agreement, limited liability company agreement, certificate of
incorporation, by-laws or other constitutive documents of any Issuer in any
way that changes the rights of the Company with respect to any Pledged
Equity Interests or adversely affects the validity, perfection or priority
of the Trustee's security interest therein and, without limiting the
foregoing, no such amendment or termination shall be made unless the
Company provides at least 30 days' prior written notice of such proposed
amendment or termination to the Trustee, (ii) permit any issuer of any
Pledged Equity Interest to issue to any Person other than the Company any
additional stock, partnership interests, limited liability company
interests or other equity interests of any nature or to issue securities
convertible into or granting the right of
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purchase or exchange for any stock or other equity interest of any nature
of such Issuer, (iii) other than as permitted under the Indenture or this
Agreement, permit any Issuer to dispose of all or a material portion of its
assets or (iv) waive any default under or breach of any terms, in each case
which would adversely affect the validity, perfection or priority of the
Trustee's security interest hereunder, of any constitutive document
relating to the issuer of any Pledged Equity Interest;
(b) without the prior written consent of the Trustee, it shall not
permit any Issuer to merge or consolidate unless (i) at least 10 days'
prior written notice thereof is provided to the Trustee and (ii) all the
outstanding capital stock or other equity interests of the surviving or
resulting corporation, limited liability company, partnership or other
entity is, upon such merger or consolidation, pledged hereunder and no
cash, securities or other property is distributed in respect of the
outstanding equity interests of any other constituent Person;
(c) in the event that it acquires rights in any Pledged Equity
Interests after the date hereof, it shall (A) cause each such Pledged
Equity Interest to be represented by a Security Certificate (as defined in
Section 8-102(a)(16) of the UCC) in registered form (the transfer of which
may be registered upon books maintained by the Issuer thereof), and such
Security Certificate shall by its terms (as evidenced by a legend attached
to such Security Certificate and, in the case of an Issuer that is a
partnership or a limited liability company, in the organizational documents
pursuant to which such Equity Interest is issued) expressly provide that it
is a security governed by Article 8 of the UCC, (B) deliver to the Trustee
such Security Certificates and file appropriate financing statements that
are necessary to perfect the security interest granted in such Pledged
Equity Interests and (C) deliver to the Trustee a completed Pledge
Supplement with respect to such Pledged Equity Interests; notwithstanding
the foregoing, except in the case of a transaction contemplated by Section
4(k) hereof, the security interest of the Trustee shall attach to all
Pledged Equity Interest immediately upon the Company's acquisition of
rights therein and shall not be affected by the failure of the Company to
deliver any such supplement;
(d) in the event that the Company receives any dividends, interest or
distributions on any Pledged Equity Interests, or any securities or other
property upon the merger, consolidation, liquidation or dissolution of any
Issuer, then (a) such dividends, interest or distributions and securities
or other property shall be included in the definition of Collateral
without, except in the case of a transaction contemplated by Section 4(k)
hereof, further action and (b) the Company shall immediately take all
steps, if any, necessary or advisable to ensure the validity, perfection,
priority and, if applicable, control of the Trustee over the same, and
pending any such action the Company shall be deemed to hold such dividends,
interest, distributions, securities or other property in trust for the
benefit of the Trustee and shall segregate the same from all other property
of the Company; notwithstanding the foregoing, (1) so long as no Event of
Default shall have occurred and be continuing, the Company shall have the
right to retain and utilize in its business all ordinary cash dividends and
distributions paid in the normal course of the business of the applicable
Issuer; and (2) the Company shall have the right to apply, or make
available for application, all dividends or distributions received by the
Company
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which constitute Net Proceeds of a Principal Asset Sale to the payments
required by Section 3.09 of the Indenture in the priority set forth
therein.
(e) it shall comply with all of its obligations under any partnership
agreement or limited liability company agreement relating to Pledged
Partnership Interests or Pledged LLC Interests and shall enforce all of its
material rights with respect to any such Interests;
(f) it will defend the Pledged Equity Interests against the claims and
demands of all Persons (other than holders of Permitted Liens) claiming an
interest in any of the Pledged Equity Interests; except for Permitted
Liens, it shall discharge or cause to be discharged all Liens on any or all
of the Pledged Equity Interests and shall not permit additional Liens to be
incurred on the Pledged Equity Interests;
(g) without the prior written consent of the Trustee, it shall not
withdraw as a partner or member of any Issuer if such withdrawal would
materially and adversely affect the value of the Collateral;
(h) it shall cause each Issuer to consent to the grant by the Company
to the Trustee of a security interest in the Pledged Equity Interests
issued by such Issuer and, without limiting the foregoing, to consent to
the transfer of any such Pledged Partnership Interest or Pledged LLC
Interest to the Trustee or its nominee following the occurrence and
continuance of an Event of Default and to the substitution of the Trustee
or its nominee as a partner in any partnership or as a member in any
limited liability company with all the rights and powers related thereto;
(i) so long as no Event of Default shall have occurred and be
continuing:
(i) except as otherwise provided in subsection (a) or (b) of this
Section 4 or Section 8.01(a) hereof, the Company shall be entitled to
exercise or refrain from exercising any and all voting and other
consensual rights pertaining to the Pledged Equity Interests or any
part thereof for any purpose not violating the terms of this Agreement
or the Indenture; provided that the Company shall exercise or refrain
from exercising any such right if the Trustee (which may act in its
reasonable judgment or at the direction of the Holders of not less
than a majority in aggregate principal amount of the then outstanding
Notes) shall have notified the Company that such action would have a
material adverse effect on the value of the Pledged Equity Interests
or any part thereof; and provided further that the Company shall give
the Trustee at least five (5) Business Days' prior written notice of
the manner in which it intends to exercise, or the reasons for
refraining from exercising, any such right; it being understood,
however, that neither the voting by the Company of any Pledged Stock
for, or the Company's consent to, the election of directors (or
similar governing body) at a regularly scheduled annual or other
meeting of stockholders or with respect to incidental matters at any
such meeting, nor the Company's consent to or approval of any action
otherwise permitted under this Agreement or the Indenture, shall be
deemed to
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violate the terms of this Agreement within the meaning of this Section
4(i), and no notice of any such voting or consent need be given to the
Trustee; and
(ii) the Trustee shall promptly execute and deliver (or cause to
be executed and delivered) to the Company all proxies, and other
instruments as the Company may from time to time reasonably request
for the purpose of enabling the Company to exercise voting and other
consensual rights when and to the extent to which it is entitled to
exercise such rights pursuant to clause (i) above;
(j) upon the occurrence and during the continuance of an Event of
Default:
(i) all rights of the Company to exercise or refrain from
exercising the voting and other consensual rights which it would
otherwise be entitled to exercise pursuant hereto shall cease, and all
such rights shall thereupon become vested in the Trustee, which shall
thereupon during any such period have the sole right to exercise such
voting and other consensual rights; and
(ii) in order to permit the Trustee to exercise the voting and
other consensual rights which it may be entitled to exercise pursuant
hereto, the Company shall promptly execute and deliver (or cause to be
executed and delivered) to the Trustee all proxies, orders and other
instruments as the Trustee may from time to time reasonably request
for any such purpose;
(k) if the Company shall acquire Pledged Equity Interests referred to
in clause (ii) of the definition of the term "Issuers" contained in Section
1 hereof, it shall, if it does not own directly all of the issued and
outstanding Voting Stock of the Issuer of such Pledged Equity Interests,
cause the Subsidiaries of the Company that own, directly or indirectly,
such Voting Stock to become parties to this Agreement or a supplement
hereto and to execute such other documents and instruments, and take such
action, as shall be necessary to effect the pledge of and security interest
in such Pledged Equity Interests provided for in this Agreement, and this
Agreement, as so supplemented, may provide for changes hereto necessary if
any such Pledged Equity Interests represent less than all of the
outstanding Voting Stock of the Issuer;
(l) it shall not, without the prior written consent of the Trustee,
execute or file in any public office or consent to the execution of or
filing of any enforceable financing statement or statements covering any or
all of the Pledged Equity Interests, except financing statements filed or
to be filed in favor of the Trustee, the Tranche A Trustee as secured party
or any agent or holder of obligations under any New Credit Facility;
(m) it shall give the Trustee prompt notice of any written claim
relating to title to the Pledged Equity Interests of which it has actual
knowledge; it shall deliver to Trustee a copy of each other written demand,
notice or document received by it which could reasonably be expected to
adversely affect the Trustee's interest in the Pledged Equity Interests
promptly upon, but in any event within 5 Business Days after, its receipt
thereof;
(n) it shall, promptly upon obtaining actual knowledge of any action,
suit or proceeding at law or in equity by or before any governmental
authority pending or
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threatened against it with respect to the Pledged Equity Interests, which
could reasonably be expected to result in a material adverse effect on such
Pledged Equity Interests, the Issuer thereof or the Company, the value of
such Pledged Equity Interests or the rights and remedies of the Trustee
hereunder, or upon becoming aware of any failure to comply with the terms
and conditions of any governmental approval applicable to the Company or
any Issuer which could reasonably be expected to result in a material
adverse effect on the Pledged Equity Interests, the Issuer thereof or the
Company, the value of such Pledged Equity Interests or the rights and
remedies of the Trustee hereunder, furnish to the Trustee a notice of such
event describing the same in reasonable detail and, together with such
notice or as soon thereafter as possible, a description of the action that
the Company has taken and proposes to take with respect thereto;
(o) it shall not (A) sell, assign, convey, transfer (by operation of
law or otherwise) or otherwise dispose of, or consent to the sale,
assignment, conveyance, transfer or other disposition of any Pledged Equity
Interest, except as permitted by the Indenture or the Security Documents,
or (B) create or suffer to exist any Lien upon or with respect to any
Pledged Equity Interest or consent to the creation or existence of any Lien
on the Pledged Equity Interest, except for the pledge, hypothecation and
security interest created by this Agreement, the Tranche A Pledge Agreement
and the other Security Documents or by any New Credit Facility; and
(p) it shall cause the Pledged Equity Interests to constitute at all
times not less than the entire partnership, membership or other ownership
interests of each Issuer, as applicable, and it shall not permit (i) any
partnership, membership or other ownership interest of any Issuer to be
deemed an investment company security (as defined in Section 8-103(b) of
the UCC) or (ii) any Issuer to issue additional partnership, membership or
other ownership interests at any time (whether or not certificated), except
in any such case as contemplated by Section 4(k) of this Agreement.
Section 5. Declaration of Trust; Other Provisions Concerning the
Collateral.
5.01 Declaration and Acceptance of Trust. The Trustee hereby declares,
and the Company agrees, that the Trustee holds Liens on the Collateral as
secured party in trust under this Agreement for the ratable benefit of the
Holders, with no preference, priority or distinction of any Holder over any
other Holder by reason of difference in time of issuance of the Notes or
otherwise. The Company, by executing and delivering this Agreement, and each
Holder, by acceptance of its Notes and the benefits of this Agreement, (i)
grants to the Trustee all rights and powers necessary for the Trustee to perform
its obligations hereunder and under applicable law, (ii) confirms that the
Trustee shall have the authority, subject to the terms of the Indenture and the
Security Documents and applicable law, to enforce any remedies under or with
respect to this Agreement, to give or withhold any consent or approval relating
to any Collateral, the Liens thereon or this Agreement or any obligations with
respect thereto and otherwise to take any action on behalf of the Holders
contemplated in this Agreement or under applicable law and (iii) agrees that,
except as provided in the Indenture, such Holder shall not take any action to
enforce any of such remedies or give any such consents or approvals relating to
any Collateral or the Liens thereon.
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5.02 Right to Make Advances. If an advance of funds shall at any time
be required for the preservation or maintenance of any Collateral, then, upon
three Business Days' notice to the Company, the Trustee shall be entitled (but
shall not be obligated) to make such advance. Each such advance shall be
reimbursed, with interest from the date such advance was made at the rate per
annum then borne by the Notes, by the Company, upon demand by the Trustee, and
if the Company fails to comply with any such demand, out of Trust Moneys. Any
funds advanced by the Trustee pursuant to this Section 5.02 for the preservation
or maintenance of Collateral shall be Secured Obligations hereunder.
5.03 Release of Collateral.
(a) Limitations upon Releases by Trustee. The Trustee shall not
release Collateral from the Lien of this Agreement unless such release
is in accordance with the provisions of this Section 5.03 and, to the
extent applicable, Section 314(d) of the TIA.
(b) Full Release of Collateral. The Company shall be entitled to
obtain a full release of all of the Collateral (except for Collateral
consisting of funds deposited or segregated in satisfaction of the
requirements of Section 2.04 and Article 8 of the Indenture
("Deposited Funds"), as to which Collateral the Trustee may continue
to possess and shall retain its Lien for such duration and as required
by the Indenture) from the Lien of this Agreement upon compliance with
all of the conditions precedent set forth in such Article 8 for
satisfaction and discharge of all of the Company's obligations under
the Indenture or for the creation of a defeasance trust with respect
to the Company's obligations under the Indenture. Upon delivery by the
Company to the Trustee of an Officers' Certificate and an Opinion of
Counsel, each to the effect that all of the applicable conditions
precedent and other requirements described above have been complied
with, the Trustee shall take all necessary action, at the request and
expense of the Company, to release and reconvey to the Company all of
the Collateral (except for Collateral consisting of Deposited Funds,
as to which Collateral the Trustee may continue to possess and shall
retain its Lien for such duration and as required by the Indenture),
and the Trustee shall deliver to the Company any such Collateral in
its possession so to be released and reconveyed.
(c) Release upon Asset Sale. So long as no Event of Default has
occurred and is continuing at the time of any Asset Sale, upon any
Asset Sale effected in compliance with the provisions of the
Indenture, Collateral which is the subject of such sale shall be
released from the Lien of this Agreement in accordance with the
provisions of the Indenture, this Agreement and the TIA. In such
event, the Trustee shall execute, deliver or acknowledge any necessary
or proper instruments of termination, satisfaction or release required
to effect the release of such Collateral upon (i) delivery by the
Company to the Trustee of an Officers' Certificate setting forth the
aggregate amount of the Net Proceeds to be received upon such Asset
Sale, (ii) in the case of a Principal Asset Sale, receipt by the
Trustee of such Net Proceeds to be held as Trust Moneys hereunder and
(iii) the delivery by the Company to the Trustee of an Officers'
Certificate and an
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Opinion of Counsel, each to the effect that all of the applicable
conditions precedent and other requirements of the Indenture and this
Agreement in connection with such Asset Sale have been complied with
and, in the case of such Opinion of Counsel with respect to a
Principal Asset Sale, that all action has been effected as shall be
necessary to create, perfect and make enforceable a Lien under this
Agreement on any other consideration constituting Collateral and
required hereby to be delivered to the Trustee in connection with such
Asset Sale. Notwithstanding any provision of this Agreement to the
contrary, the Company shall not be required to deliver to the Trustee
as Collateral any proceeds of any Asset Sale that do not constitute
Net Proceeds, and any such other proceeds may be retained by or
delivered to or upon the order of the Company, unless such other
proceeds shall thereafter become Net Proceeds, in which event they
shall be delivered to the Trustee as Collateral.
5.04 Purchaser Protected. In no event shall any purchaser in good
faith of any Collateral purported to be released from the Lien created hereby be
bound to ascertain the authority of the Trustee to execute any such release or
to inquire as to the satisfaction of any conditions required by the provisions
hereof for the exercise of such authority or to see to the application of any
consideration given by such purchaser or other transferee; nor shall any
purchaser or other transferee of any Collateral permitted by Section 5.03 hereof
to be sold be under any obligation to ascertain or inquire into the authority of
the Company to make any such sale or other transfer.
5.05 Powers Exercisable by Receiver or Trustee. If the Collateral
shall be in the possession of a receiver or trustee, lawfully appointed, the
powers conferred in Section 5.03 hereof upon the Company with respect to the
release, sale or other disposition of Collateral may be exercised by such
receiver or trustee, and an instrument signed by such receiver or trustee shall
be deemed the equivalent of any similar instrument of the Company or of any
officer or officers thereof required by the provisions of such Section 5.03.
Section 6. Filings, Perfection, Etc. In furtherance of the grant of
the pledge and security interest made pursuant to Section 3 hereof, the Company
hereby agrees with the Trustee that the Company will at its expense:
(a) prior to or concurrently with the execution and delivery of this
Agreement, (i) file such financing statements and other documents in such
offices as shall be necessary or desirable (or as the Trustee may
reasonably request) to perfect the security interests granted or purported
to be granted by this Agreement, (ii) deliver to the Trustee all
certificates identified on Schedule B hereto evidencing Pledged Equity
Interests, accompanied by an executed irrevocable proxy and an undated
stock or other powers duly executed in blank (in the forms of Exhibits B
and C attached hereto), and (iii) deliver to the Trustee an Officers'
Certificate and an Opinion of Counsel to the effect that all actions
necessary to perfect the Lien of the Trustee in the Collateral in existence
on the date hereof have been duly effected in accordance with the
provisions of Articles 8 and 9 of the Uniform Commercial Code and other
applicable law;
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(b) if any other shares, securities, moneys or property pledged by the
Company under Section 3 hereof are received by the Company, forthwith
either (x) transfer and deliver to the Trustee such shares or securities so
received by the Company (together with the certificates for any such shares
and securities duly endorsed in blank or accompanied by undated stock or
other powers duly executed in blank), all of which thereafter shall be held
by or for the benefit of the Trustee pursuant to the terms of this
Agreement as part of the Collateral or (y) take such other action as shall
be necessary or appropriate to duly perfect the security interests created
hereunder in such shares, securities, moneys or property;
(c) promptly give, execute, deliver, file and/or record any financing
statement, notice, instrument, document, agreement or other paper that
shall be necessary or desirable to create, preserve, perfect and validate
the pledge and security interest granted pursuant hereto and to enable the
Trustee to exercise and enforce its rights hereunder with respect to such
pledge and security interest;
(d) keep full and accurate books and records relating to the
Collateral, and stamp or otherwise mark such books and records in such
manner as shall be necessary or appropriate in order to reflect the
security interest granted by this Agreement and furnish to the Trustee,
from time to time at the Trustee's request, copies of such books and
records; and
(e) (i) cause each Pledged Equity Interest to be represented by a
Security Certificate (as defined in Section 8-102(a)(16) of the UCC) in
registered form (the transfer of which may be registered upon books
maintained by the Issuer thereof) and cause such Security Certificate to,
by its terms (as evidenced by a legend attached to such Security
Certificate and, in the case of an Issuer that is a partnership or a
limited liability company, in the organizational documents pursuant to
which such Equity Interest is issued) expressly provide that it is a
security governed by Article 8 of the UCC and (ii) deliver to the Trustee
each such Security Certificate.
Section 7. Trust Moneys.
7.01 Trust Moneys. Trust Moneys shall be subject to a Lien in favor of
the Trustee and shall be held by the Trustee for the benefit of the Holders as a
part of the Collateral. The Trustee shall apply Trust Moneys as follows:
FIRST: to the payment of any amounts owing to the Trustee hereunder or
under the Indenture and to reimburse the Trustee the amount of any advance
made pursuant to Section 5.02 hereof (with interest thereon at the rate
then borne by the Notes); and
SECOND: so long as no Event of Default shall have occurred and be
continuing, any remaining Trust Moneys (except for Trust Moneys consisting
of Deposited Funds, as to which the Trustee may continue to possess and
shall retain its Lien for such duration and as required by the Indenture)
may be withdrawn by the Company and released from the Lien of this
Agreement and shall be paid by the Trustee to the Company, provided that,
to the extent that such Trust Moneys constitute Net Proceeds of a Principal
Asset
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Sale, such Trust Moneys may be withdrawn by the Company only against
delivery of an Officers' Certificate to the Trustee to the effect that such
Trust Moneys, upon withdrawal, are to be applied in accordance with the
requirements, if applicable, of Section 3.09 or the last paragraph of
Section 4.10, as the case may be, of the Indenture.
The provisions of Section 7.03 shall govern the application of any
Trust Moneys upon the occurrence and continuance of an Event of Default.
7.02 Withdrawal of Certain Trust Moneys. To the extent that any Trust
Moneys consist of moneys received by the Trustee that result in the requirement
pursuant to Section 3.09 of the Indenture that the Company redeem Notes and the
Company has effected such redemption in accordance with the Indenture, the Trust
Moneys remaining after such redemption has been effected may be withdrawn by the
Company and released from the Lien of this Agreement and shall be paid by the
Trustee to the Company upon receipt by the Trustee of (i) an Officers'
Certificate certifying that all conditions precedent and covenants provided for
herein and in the Indenture relating to such release have been complied with and
(ii) such other documentation, if any, as shall be required under Section 314(d)
of the TIA.
7.03 Application of Trust Moneys upon Event of Default. If an Event of
Default has occurred and is continuing, and any of the Secured Obligations has
been accelerated, then the Trustee shall, as soon as practicable, apply the
Trust Moneys and other amounts or proceeds from the sale or other disposition of
or realization upon any Lien on the Collateral as follows:
FIRST: to the payment of the costs and expenses of such sale,
disposition or other realization, including reasonable out-of-pocket costs
and expenses of the Trustee and the reasonable fees and expenses of its
agents and counsel, and all expenses incurred and advances made by the
Trustee or any Holder to the extent that such Holder may act pursuant to
the Indenture in connection therewith, together with any amounts owing to
the Trustee under this Agreement (including Section 5.02 hereof) or the
Indenture; and
SECOND: to the payment in full of the accelerated Secured Obligations,
in each case equally and ratably in accordance with the respective amounts
thereof then due and owing; and
THIRD: after payment in full of the accelerated Secured Obligations,
to the payment to the Company, or its successors or assigns, or as a court
of competent jurisdiction may direct, of any surplus then remaining.
As used in this Section 7.03, "proceeds" of the Collateral means cash,
securities and other property realized in respect of, and distributions in kind
of, the Collateral, including any thereof received under any Insolvency or
Liquidation Proceeding of the Company or any Issuer.
Section 8. Remedies, Etc.
8.01 Event of Default. During the period during which an Event of
Default shall have occurred and be continuing:
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(a) the Trustee shall have, and shall be entitled to exercise, all of
the rights and remedies with respect to the Collateral of a secured party
under the Uniform Commercial Code and such additional rights and remedies
to which a secured party is entitled under the laws in effect in any
jurisdiction where any rights and remedies hereunder may be asserted,
including the right, to the maximum extent permitted by law, to exercise
all voting, consensual and other incidental powers of ownership pertaining
to any Pledged Equity Interests or other capital stock, ownership
interests, securities, notes or other obligations constituting Collateral
as if the Trustee were the sole and absolute owner thereof, including,
pursuant to an executed irrevocable proxy in the form attached hereto as
Exhibit B, to vote the Pledged Equity Interests and such other Collateral
(and the Company agrees to take all such action as may be appropriate to
give effect to such right);
(b) the Trustee in its discretion may, in its name or in the name of
the Company or otherwise, demand, sue for, collect or receive any money or
property at any time payable or receivable on account of or in exchange for
any of the Collateral, but shall be under no obligation to do so;
(c) the Trustee may, upon ten Business Days' (or such longer period as
may be required under applicable law) prior written notice to the Company
of the time and place thereof, with respect to the Collateral or any part
thereof that shall then be or shall thereafter come into the possession,
custody or control of the Trustee or any of its agents, sell, lease, assign
or otherwise dispose of all or any part of such Collateral, at such place
or places as the Trustee deems best, and for cash or for credit or for
future delivery (without thereby assuming any credit risk), at public or
private sale, without demand of performance or notice of intention to
effect any such disposition or of the time or place thereof (except such
notice as is required above or by applicable statute, including the Uniform
Commercial Code, and cannot be waived), and the Trustee or any Holder or
anyone else may be the purchaser, lessee, assignee or recipient of any or
all of the Collateral so disposed of at any public sale (or, to the extent
permitted by law, at any private sale) and thereafter hold the same
absolutely, free from any claim or right of whatsoever kind, including any
right or equity of redemption (statutory or otherwise), of the Company, any
such demand, notice and right or equity being hereby expressly waived and
released to the maximum extent permitted by applicable law. The Trustee may
consult with counsel, accountants and other experts in connection with the
sale, lease or assignment of the Collateral and the advice of such counsel
shall be full and complete authorization and protection from liability in
respect of any action taken, suffered or omitted by it in good faith and in
reliance thereon. The Trustee may, without notice or publication, adjourn
any public or private sale or cause the same to be adjourned from time to
time by announcement at the time and place fixed for the sale, and such
sale may be made at any time or place to which the sale may be so
adjourned; to the fullest extent permitted by Applicable Law, the Company
shall have the burden of proving that any such disposition of the Pledged
Equity Interest was conducted in a commercially unreasonable manner;
(d) the Trustee may transfer or register in its name or the name of
its nominee the Pledged Equity Interests;
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(e) to the extent permitted by law, the Trustee may accept the Pledged
Equity Interests in full or partial satisfaction of the Secured
Obligations;
(f) the Trustee may make such payments and take such actions as the
Trustee deems necessary to protect, perfect or continue the perfection of
its Lien on the Pledged Equity Interests; and
(g) the Trustee may, without being required to give prior notice,
withdraw or cause the withdrawal of any and all cash constituting Trust
Moneys.
The Trustee shall have no obligation to exercise any right or power
granted hereunder or to marshal any of the Collateral or the assets of the
Company.
The proceeds of each collection, sale or other disposition and any
cash constituting Trust Moneys withdrawn under this Section 8.01 shall be
applied in accordance with Section 7.03 hereof.
8.02 Deficiency. If the proceeds of sale, collection or other
realization of or upon the Collateral pursuant to Section 8.01 hereof are
insufficient to cover the costs and expenses of such realization and the payment
in full of the Secured Obligations, the Company shall remain liable for any
deficiency.
8.03 Removals, Etc. Without at least 10 days' prior written notice to
the Trustee, the Company shall not (i) maintain any of its books and records
with respect to the Collateral at any office, or maintain its principal place of
business at any place, other than at the address of the Company for notices
specified or provided for in Section 11.02 of the Indenture, (ii) change its
name, or the name under which it does business, from the name shown on the
signature pages hereto or (iii) change its jurisdiction of organization.
8.04 Private Sale. Neither the Trustee nor any Holder shall incur any
liability as a result of the sale of the Collateral, or any part thereof, at any
private sale pursuant to Section 8.01 hereof conducted in a commercially
reasonable manner under the Uniform Commercial Code. The Company hereby waives,
to the extent permitted by law, any claims against the Trustee or any Holder
arising by reason of the fact that the price at which any Collateral may have
been sold at such a private sale was less than (a) the price which might have
been obtained at a public sale or (b) the aggregate amount of the Secured
Obligations.
8.05 Termination. Upon the final and indefeasible payment in full of
the Secured Obligations (other than those consisting only of indemnification
obligations), this Agreement shall terminate, and the Trustee shall forthwith
cause to be assigned, transferred and delivered, against written receipt but
without any recourse, warranty or representation whatsoever, any remaining
Collateral and money received in respect thereof, to or on the order of the
Company. The Trustee shall also execute and deliver to the Company upon such
termination or release of Collateral such Uniform Commercial Code termination
statements and such other documentation and take such other actions as shall be
reasonably requested by, and at the expense of, the Company to effect the
termination and release of the Liens on the Collateral.
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Section 9. The Trustee's Appointment as Attorney-in-Fact.
9.01 Appointment as Attorney-in-Fact.
(a) The Company hereby irrevocably constitutes and appoints (which
appointment shall be coupled with an interest) the Trustee and any officer or
agent thereof, with full power of substitution, as its true and lawful
attorney-in-fact with full irrevocable power and authority in the place and
stead of the Company and in the name of the Company or in its own name, for the
purpose of carrying out the terms of this Agreement, to take any and all
appropriate and lawful action and to execute any and all documents and
instruments which may be necessary or desirable to accomplish the purposes of
this Agreement, and, without limiting the generality of the foregoing, the
Company hereby gives the Trustee the power and right, on behalf of the Company,
without notice to or assent by the Company, to do any or all of the following:
(i) pay or discharge taxes and Liens levied or placed on or
threatened against the Collateral;
(ii) execute, in connection with any Asset Sale, any
endorsements, assignments or other instruments of conveyance or
transfer with respect to the Collateral; and
(iii) (A) direct any party liable for any payment under any of
the Collateral to make payment of any and all moneys due or to become
due thereunder directly to the Trustee or as the Trustee shall direct;
(B) ask or demand for, collect, and receive payment of and receipt
for, any and all moneys, claims and other amounts due or to become due
at any time in respect of or arising out of any Collateral; (C)
commence and prosecute any suits, actions or proceedings at law or in
equity in any court of competent jurisdiction to collect the
Collateral or any portion thereof and to enforce any other right in
respect of any Collateral; (D) defend any suit, action or proceeding
brought against the Company with respect to any Collateral; (E)
settle, compromise or adjust any such suit, action or proceeding and,
in connection therewith, give such discharges or releases as the
Trustee may deem appropriate; and (F) generally, sell, transfer,
pledge and make any agreement with respect to or otherwise deal with
any of the Collateral as fully and completely as though the Trustee
were the absolute owner thereof for all purposes, and do, at the
Trustee's option and the Company's expense, at any time, or from time
to time, all acts and things which the Trustee deems necessary to
protect, preserve or realize upon the Collateral and the Trustee's
security interest therein and to effect the intent of this Agreement,
all as fully and effectively as the Company might do.
Anything in this Section 9.01(a) to the contrary notwithstanding, but subject to
other provisions of this Agreement, the Trustee agrees that it will not exercise
any rights under the power of attorney provided for in this Section 9.01(a)
unless an Event of Default has occurred and is continuing.
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(b) If the Company fails to perform or comply with any of its
agreements contained herein, the Trustee, at its option, but without any
obligation so to do, may perform or comply, or otherwise cause performance or
compliance, with such agreement.
(c) The expenses of the Trustee incurred in connection with actions
undertaken as provided in this Section 9.01, together with interest thereon at a
rate per annum equal to the rate per annum then borne by the Notes, from the
date of payment by the Trustee to the date reimbursed by the Company, shall be
payable by the Company to the Trustee on demand.
(d) The Company hereby ratifies all that said attorneys shall lawfully
do or cause to be done by virtue hereof. All powers, authorizations and agencies
contained in this Agreement are coupled with an interest and are irrevocable
until this Agreement is terminated and the security interest created hereby are
released.
Section 10. Intercreditor Agreement.
10.01 Intercreditor Agreement Controls. The rights and obligations of
the parties hereto and the rights of the Holders hereunder are subject to the
provisions of the Intercreditor Agreement, and in the event of any conflict or
inconsistency between the provisions of the Intercreditor Agreement and the
provisions of this Agreement or any of the other Security Documents, the
provisions of the Intercreditor Agreement shall control. Without limiting the
generality of the foregoing, references herein to delivery of Collateral or
documents to the Trustee, or to the Trustee's possession thereof, shall be
deemed to be references to delivery of Collateral or documents to, or possession
by, the Collateral Agent, as provided in the Intercreditor Agreement.
Section 11. Certain Provisions with respect to Remedies; Marshaling
Pledged Equity Interest.
(a) To the extent applicable laws impose on the Trustee an obligation
to exercise remedies in a commercially reasonable manner, the Company
acknowledges and agrees that, to the extent consistent with applicable law,
it is not commercially unreasonable for the Trustee (i) to incur expenses
reasonably deemed significant by the Trustee to prepare the Pledged Equity
Interests for disposition, (ii) to fail to remove Liens or encumbrances on
or any adverse claims against the Pledged Equity Interests, (iii) to
advertise or fail to advertise dispositions of the Pledged Equity Interests
through publications or media of general circulation, (iv) to contact or
fail to contact other Persons, whether or not in the same business as the
Company, in connection with expressions of interest in acquiring all or any
portion of the Pledged Equity Interests, (v) to hire or fail to hire one or
more professional auctioneers to assist in the disposition of the Pledged
Equity Interests, (vi) to dispose of the Pledged Equity Interests by
utilizing internet sites that provide for the auction of assets of the
types included in the Pledged Equity Interests or that have reasonable
capability of doing so, or that match buyers and sellers of assets (or to
fail to do so), (vii) to disclaim disposition warranties, (viii) to
purchase insurance or credit enhancements to insure the Trustee against the
risk of loss, collection or disposition of the Pledged Equity Interests, or
(ix) to the extent deemed appropriate by the Trustee, to obtain the
services of other brokers, investment bankers, consultants and other
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professionals to assist the Trustee in the collection or disposition of any
of the Pledged Equity Interests.
(b) Without limiting the generality of the foregoing and except as
otherwise provided by applicable laws, the Trustee shall not be required to
marshal any collateral, including the Pledged Equity Interests, or to
resort to any item of the Pledged Equity Interest in any particular order;
and all of the Trustee's rights hereunder and in respect of such Pledged
Equity Interests and any guarantees shall be cumulative and in addition to
all other rights, however existing or arising. To the extent that the
Company lawfully may, the Company hereby (i) agrees that it will not invoke
any applicable laws relating to the marshaling of collateral which might
cause delay in or impede the enforcement of the Trustee's rights under this
Agreement or under any other instrument evidencing any of the Secured
Obligations or under which any of the Secured Obligations is outstanding or
by which any of the Secured Obligations is secured or guaranteed and (ii)
irrevocably waives the benefits of all applicable laws and any and all
rights to equity of redemption or other rights of redemption that it may
have in equity or at law with respect to the Pledged Equity Interests.
Section 12. Security Interest Absolute.
(a) The obligations of the Company under this Agreement are intended
to be independent of the Secured Obligations, and a separate action or
actions may be brought and prosecuted against the Company to enforce this
Agreement, irrespective of whether any action is brought against another
pledgor of the Secured Obligations or whether another pledgor of the
Secured Obligations is joined in any such action or actions. All rights of
the Trustee and the pledge, hypothecation and security interest hereunder,
and all obligations of the Company hereunder, shall be absolute and
unconditional, to the extent permitted by applicable law, irrespective of:
(i) any lack of validity or enforceability of the Indenture or
Security Documents or any other agreement or instrument relating
thereto;
(ii) any change in the time, manner or place of payment of, or in
any other term of, all or any of the Secured Obligations, or any other
amendment or waiver of or any consent to any departure from the
Indenture or any Security Document;
(iii) any taking, exchange, release or non-perfection of any
other collateral, or any taking, release or amendment or waiver of, or
consent to departure from any guarantee, for all or any of the Secured
Obligations;
(iv) any manner of application of the Pledged Equity Interests,
or proceeds thereof, to all or any of the Secured Obligations, or any
manner of sale or other disposition of any other collateral for all or
any of the Secured Obligations;
(v) any change, restructuring or termination of the structure or
existence of the Company or any Issuer; or
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(vi) any other circumstances which would otherwise constitute a
defense available to, or a discharge of, the Company, any Issuer or a
third party grantor of a security interest.
(b) The Company hereby waives, to the extent permitted by applicable
law, (i) all rights under any applicable law limiting remedies, including
recovery of a deficiency from the Company, whether by right of subrogation or
otherwise; (ii) all rights under any applicable law to require the Trustee to
pursue any Issuer or any other Person, any security which the Trustee may hold
or any other remedy before proceeding against the Company; (iii) all rights of
reimbursement or subrogation, all rights to enforce any remedy that the Trustee
may have against any Issuer and all rights to participate in any security held
by the Trustee, until the Secured Obligations have been indefeasibly paid and
performed in full; (iv) all rights to require the Trustee to give any notices of
any kind, including, without limitation, notices of nonpayment, nonperformance,
protest, dishonor, default, delinquency or acceleration, or to make any
presentments, demands or protests, except as set forth herein or expressly
provided in the Indenture; (v) all rights to assert the bankruptcy or insolvency
of any Issuer as a defense hereunder or as the basis for rescission hereof; (vi)
all rights under any applicable law purporting to reduce the Company's
obligations hereunder if the Secured Obligations are reduced; (vii) all defenses
based on the disability or lack of authority of the Company, any Issuer or any
Person, the repudiation of the Indenture or the Security Documents by the
Company, any Issuer or any Person, the failure by the Trustee to enforce any
claim against the Company or any Issuer or the unenforceability in whole or in
part of the Indenture or any Security Document; (viii) all suretyship and
guarantor's defenses generally; (ix) all rights to insist upon, plead or in any
manner whatever claim or take the benefit or advantage of, any appraisal,
valuation, stay, extension, marshalling of assets, redemption or similar law, or
exemption, whether now or at any time hereafter in force, which may delay,
prevent or otherwise affect the performance by the Company of its obligations
under, or the enforcement by the Trustee of, this Agreement; (x) any requirement
on the part of the Trustee to mitigate the damages resulting from any default;
and (xi) except as otherwise specifically set forth herein, all rights of notice
and hearing of any kind prior to the exercise of rights by the Trustee upon the
occurrence and during the continuation of an Event of Default to repossess with
judicial process or to replevy, attach or levy upon the Pledged Equity
Interests. To the extent permitted by applicable law, the Company waives the
posting of any bond otherwise required of the Trustee in connection with any
judicial process or proceeding to obtain possession of, replevy, attach or levy
upon the Pledged Equity Interests, to enforce any judgment or other security for
the Secured Obligations, to enforce any judgment or other court order entered in
favor of the Trustee or to enforce by specific performance, temporary
restraining order or preliminary or permanent injunction this Agreement or any
other agreement or document between the Company and the Trustee. Upon the
occurrence and during the continuation of an Event of Default, the Trustee may
elect to nonjudicially or judicially foreclose against any security it holds for
the Secured Obligations or any part thereof, or to exercise any other remedy
against the Company or any Issuer, any even if the effect of that action is to
deprive the Company of the right to collect reimbursement from any Issuer for
any sums paid by the Company to the Trustee.
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Section 13. Miscellaneous.
13.01 No Waiver. No failure on the part of the Trustee to exercise,
and no course of dealing with respect to, and no delay in exercising, any right,
power or remedy hereunder shall operate as a waiver thereof nor shall any single
or partial exercise by the Trustee of any right, power or remedy hereunder
preclude any other or further exercise thereof or the exercise of any other
right, power or remedy. The remedies herein are cumulative and are not exclusive
of any remedies provided by law.
13.02 Notices. All notices, requests, demands and other communications
provided for or permitted hereunder shall be in writing (including telex and
telecopy communications) and shall be sent to the addresses and in the manner
provided in Section 11.02 of the Indenture.
13.03 Expenses. Without limitation of any of the provisions of the
Indenture, the Company agrees to reimburse the Trustee for all reasonable costs
and expenses of the Trustee (including the reasonable fees and expenses of legal
counsel) in connection with (i) any Event of Default and any enforcement or
collection proceeding resulting therefrom, including all manner of participation
in or other involvement with (w) any performance by the Trustee of any
obligations of the Company in respect of the Collateral that the Company has
failed or refused to perform, (x) any Insolvency or Liquidation Proceeding and
any actual or attempted sale of, or any exchange, enforcement, collection,
compromise or settlement in respect of, any of the Collateral, and for the care
of the Collateral and defending or asserting rights and claims of the Trustee in
respect thereof, by litigation or otherwise, (y) judicial or regulatory
proceedings and (z) workout, restructuring or other negotiations or proceedings
(whether or not the workout, restructuring or transaction contemplated thereby
is consummated) and (ii) the enforcement of this Section 13.03, and all such
costs and expenses shall be Secured Obligations entitled to the benefits of the
Lien provided pursuant to this Agreement.
In addition to the foregoing, the Company shall pay or reimburse the
Trustee for all stamp, filing and transfer fees, taxes (other than income taxes
in respect of the compensation received by the Trustee under the Indenture) and
other similar imposts which may be payable or determined to be payable in
respect of the execution, delivery, performance or enforcement of this
Agreement, the Notes or any of the Security Documents. Any amounts due by the
Company under this Section 13.03 shall be in addition to (and not in limitation
of) any amounts due to the Trustee or any Holders under the Indenture.
13.04 Amendments, Etc. The terms of this Agreement may be waived,
altered or amended only by an instrument in writing duly executed by the Company
and the Trustee (with the consent of the Holders to the extent required under
Article 9 of the Indenture).
13.05 Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the Company,
the Trustee and the Holders (provided, however, that the Company shall not
assign or transfer its rights or obligations hereunder, except pursuant to a
transaction permitted under Article 5 of the Indenture, without the prior
written consent of the Trustee).
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Notwithstanding anything herein to the contrary, the resignation or
removal of the Trustee under the Indenture shall be effective to cause the
resignation or removal of the Trustee (as applicable) for all purposes under and
in connection with the Security Documents.
13.06 Captions. The captions and section headings appearing herein are
included solely for convenience of reference and are not intended to affect the
interpretation of any provision of this Agreement.
13.07 Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and either of the parties hereto may execute this Agreement by
signing any such counterpart.
13.08 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the law of the State of New York, except to the
extent that the validity or perfection of the security interest hereunder, or
remedies hereunder, in respect of any particular Collateral are governed by the
laws of a jurisdiction other than the State of New York.
13.09 SUBMISSION TO JURISDICTION; SERVICE OF PROCESS. EACH PARTY
HERETO MAY ENFORCE ANY CLAIM ARISING OUT OF THIS AGREEMENT IN ANY STATE OR
FEDERAL COURT HAVING SUBJECT MATTER JURISDICTION AND LOCATED IN THE CITY OF NEW
YORK, NEW YORK. FOR THE PURPOSE OF ANY ACTION OR PROCEEDING INSTITUTED WITH
RESPECT TO ANY SUCH CLAIM, EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY SUBMITS
TO THE JURISDICTION OF SUCH COURTS AND IRREVOCABLY CONSENTS TO THE SERVICE OF
PROCESS OUT OF SUCH COURTS BY MAILING A COPY THEREOF, BY REGISTERED MAIL,
POSTAGE PREPAID, TO SUCH PERSON AT SUCH PERSON'S ADDRESS SET FORTH IN THE
SIGNATURE PAGES HEREOF AND AGREES THAT SUCH SERVICE, TO THE FULLEST EXTENT
PERMITTED BY LAW, (i) SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF
PROCESS UPON SUCH PERSON IN ANY SUCH SUIT, ACTION OR PROCEEDING AND (ii) SHALL
BE TAKEN AND HELD TO BE VALID PERSONAL SERVICE UPON AND PERSONAL DELIVERY TO
SUCH PERSON. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHTS OF THE PARTIES TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR PRECLUDE THE PARTIES
HERETO FROM BRINGING AN ACTION OR PROCEEDING IN RESPECT HEREOF IN ANY OTHER
PLACE HAVING JURISDICTION OVER SUCH ACTION. THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
SUCH PERSON NOW OR HEREAFTER MAY HAVE TO THE LAYING OF THE VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY
CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
JURY TRIAL. EACH PARTY HERETO HEREBY EXPRESSLY WAIVES, TO THE FULLEST
EXTENT PERMITTED BY LAW, ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION OR
PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS OR REMEDIES HEREUNDER OR UNDER ANY OF
THE OTHER SECURITY DOCUMENTS,
B-23
AND AGREES THAT ANY SUCH ACTION OR PROCEEDING SHALL BE TRIED BEFORE A COURT AND
NOT BEFORE A JURY.
13.10 Reinstatement. This Agreement shall continue to be effective or
be reinstated, as the case may be, if at any time any amount received by the
Trustee or the Holders in respect of the Secured Obligations is rescinded or
must otherwise be restored or returned by the Trustee or the Holders upon the
insolvency, bankruptcy, dissolution, liquidation or reorganization of the
Company or any Issuer or upon the appointment of any intervenor or conservator
of, or trustee or similar official for, the Company or any Issuer or any
substantial part of its assets, or otherwise, all as though such payment has not
been made.
13.11 Severability. If any provision hereof is invalid or
unenforceable in any jurisdiction, then, to the fullest extent permitted by law,
(i) the other provisions hereof shall remain in full force and effect in such
jurisdiction and shall be liberally construed in favor of the Trustee and the
Holders in order to carry out the intentions of the parties hereto as nearly as
may be possible and (ii) the invalidity or unenforceability of any provision
hereof in any jurisdiction shall not affect the validity or enforceability of
such provision in any other jurisdiction.
13.12 No Limitation upon Indenture; Provisions for Benefit of Trustee.
Nothing in this Agreement shall be deemed to alter, impair or limit the
obligations of the Company, or the rights of the Trustee and the Holders, under
the Indenture. The provisions of Sections 7.01, 7.02 and 7.07 of the Indenture
shall be equally applicable to the rights and obligations of the Trustee under
this Agreement and the other Security Documents to the same extent as if set
forth herein and therein and made applicable hereto and thereto.
B-24
IN WITNESS WHEREOF, the parties hereto have caused this Pledge Agreement to
be duly executed and delivered as of the day and year first above written.
NATIONAL ENERGY & GAS TRANSMISSION,
INC.
By:
-------------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Trustee
By:
-------------------------------
Name:
Title:
SCHEDULE A
ISSUERS
Name Jurisdiction of Organization
---- ----------------------------
NEGT Enterprises, Inc. Delaware
Gas Transmission Corporation Delaware
NEGT Services Company, LLC Delaware
SCHEDULE B
PLEDGED EQUITY INTERESTS
A. PLEDGED STOCK
Certificate Class of Number of
Registered Owner Issuer No(s). Stock Par Value Shares
---------------- --------------------- ----------- -------- ------------- ---------
NEGT NEGT Enterprises, 2 Common $1.00 1,000
Inc.
NEGT Gas Transmission 2 Common no par value 1,000
Corporation
B. PLEDGED LLC INTERESTS
Registered Certificate Contributed
Owner Issuer No(s). Amount
---------- ------------- ----------- -----------
NEGT NEGT Services 1 $100.00
Company, LLC
SCHEDULE C
FILINGS
Uniform Commercial Code financing statement to be filed in the Office of the
Secretary of State of the State of Delaware.
EXHIBIT A
FORM OF PLEDGE SUPPLEMENT
This PLEDGE SUPPLEMENT, dated as of ___________, is delivered pursuant to
the Pledge Agreement dated as of ___, 2004 (as the same may be amended,
supplemented or otherwise modified and in effect from time to time, the "Pledge
Agreement") between National Energy & Gas Transmission, Inc., a Delaware
corporation (the "Company"), and Wilmington Trust Company, a Delaware banking
corporation, as trustee under the Indenture referred to in the Pledge Agreement
(the "Trustee"). Terms used but not defined herein have the respective meanings
assigned to such terms in or by reference in the Pledge Agreement.
The Company hereby confirms the pledge of and grant to the Trustee of the
security interest in, as set forth in the Pledge Agreement, and does hereby
pledge and grant to the Trustee a security interest in, all of the Company's
right, title and interest in and to the Collateral to secure the Secured
Obligations, in each case whether now owned by the Company or hereafter acquired
and whether now existing or hereafter coming into existence, including, without
limitation, the Pledged Equity Interests specified on the attached supplement to
Schedule B to the Pledge Agreement. The Company represents and warrants that the
attached supplements to schedules to the Pledge Agreement accurately and
completely set forth all additional information required to be set forth therein
pursuant to the Pledge Agreement and hereby agrees that such supplements
constitute part of the schedules to the Pledge Agreement.
IN WITNESS WHEREOF, the Company has caused this Pledge Supplement to be
duly executed and delivered as of ___________________.
NATIONAL ENERGY & GAS TRANSMISSION, INC.
By:
------------------------------------
Name:
Title:
SUPPLEMENT TO SCHEDULE A
TO PLEDGE AGREEMENT
ISSUERS
-------
SUPPLEMENT TO SCHEDULE B
TO PLEDGE AGREEMENT
PLEDGED EQUITY INTERESTS
------------------------
EXHIBIT B
FORM OF IRREVOCABLE PROXY
The undersigned hereby appoints _______________________ as Proxy with full
power of substitution, and hereby authorizes the Trustee, for the ratable
benefit of the Holders, to represent and vote all of the Pledged Equity
Interests of National Energy & Gas Transmission, Inc., a Delaware corporation,
owned by the undersigned on or after the date of exercise hereof in accordance
with the Pledge Agreement, for so long as an Event of Default has occurred and
is continuing, at any meeting or at any other time chosen by Trustee in its sole
discretion.
Date:
------------------
NATIONAL ENERGY & GAS
TRANSMISSION, INC.
By:
-----------------------
Name:
Title:
EXHIBIT C
FORM OF
PARTNERSHIP/LIMITED LIABILITY COMPANY/
STOCK/TRUST POWER
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and transfers
unto ________________ all of its partnership/limited liability
company/stock/trust interests in the Pledged Equity Interests standing in its
name on the books of the issuer of such interests, represented by the following
certificate(s): ________________, and irrevocably appoints ________________ as
attorney to transfer such certificated securities with full power of
substitution in the premises.
Date:
------------------
NATIONAL ENERGY & GAS
TRANSMISSION, INC.
By:
-----------------------
Name:
Title:
In the presence of:
---------------------------
Draft - 6/21/04
EXHIBIT C
---------
********************************************************************************
NATIONAL ENERGY & GAS TRANSMISSION, INC.,
as Issuer
THE BANK OF NEW YORK,
as Initial Collateral Agent
THE BANK OF NEW YORK,
as Tranche A Trustee
and
WILMINGTON TRUST COMPANY,
as Tranche B Trustee
COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT
Dated as of June ___, 2004
********************************************************************************
TABLE OF CONTENTS
Page
Section 1. Definitions.....................................................................................2
Section 2. Representations and Warranties..................................................................5
Section 3. Priority of Liens...............................................................................6
3.01. Subordination.......................................................................................6
3.02. Certain Enforcement Actions.........................................................................8
3.03. Certain Matters Pertaining to Insolvency Proceedings................................................8
3.04. Certain Actions With Respect to Liens...............................................................9
3.05. Perfection of Security Interests...................................................................10
3.06. Control of Dispositions of Collateral..............................................................11
3.07. Payment of Proceeds................................................................................12
Section 4. Bank Credit Facility Reliance, Modifications, Etc..............................................12
4.01. Notice of Acceptance, Etc..........................................................................12
4.02. Modifications to Documents.........................................................................13
4.03. Liability of Banks.................................................................................14
4.04. Further Assurances.................................................................................14
Section 5. Changes of Collateral Agent....................................................................14
5.01. Replacement by Bank Representative.................................................................14
5.02. Replacement by Trustee.............................................................................14
Section 6. Miscellaneous..................................................................................14
6.01. No Waiver..........................................................................................14
6.02. Notices............................................................................................14
6.03. Expenses...........................................................................................14
6.04. Amendments, Etc....................................................................................15
6.05. Successors and Assigns.............................................................................15
6.06. Captions...........................................................................................16
6.07. Counterparts.......................................................................................16
6.08. Governing Law......................................................................................16
6.09. SUBMISSION TO JURISDICTION; SERVICE OF PROCESS; ATTORNEYS' FEES....................................16
6.10. Severability.......................................................................................17
6.11. Information as to Bank Credit Facility.............................................................17
6.12. No Limitation upon Bank Credit Facility or Indentures; Certain Provisions
Applicable Hereunder..............................................................................17
6.13. No Third Party Beneficiaries.......................................................................17
6.14. Intercreditor Agreement Controls...................................................................17
6.15. Termination........................................................................................17
i
COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT
COLLATERAL AGENCY AND INTERCREDITOR AGREEMENT dated as of June
____, 2004 among NATIONAL ENERGY & GAS TRANSMISSION, INC., a Delaware
corporation (the "Company"), THE BANK OF NEW YORK, a New York banking
corporation, as initial Collateral Agent as provided herein, THE BANK OF NEW
YORK, as trustee under the within-mentioned Tranche A Indenture, and WILMINGTON
TRUST COMPANY, a Delaware banking corporation, as trustee under the
within-mentioned Tranche B Indenture.
Pursuant to an Indenture dated as of the date hereof (as the
same may be amended, supplemented or otherwise modified and in effect from time
to time, the "Tranche A Indenture") between the Company and The Bank of New
York, as trustee (the "Tranche A Trustee"), the Company has authorized the
issuance of up to $500 million principal amount of its Secured Tranche A Term
Notes due 2011 (the "Tranche A Notes").
Pursuant to an Indenture dated as of the date hereof (as the
same may be amended, supplemented or otherwise modified and in effect from time
to time, the "Tranche B Indenture") between the Company and Wilmington Trust
Company, as trustee (the "Tranche B Trustee"), the Company has authorized the
issuance of up to $500 million principal amount of its Secured Tranche B Term
Notes due 2011 (the "Tranche B Notes").
The Company may from time to time incur indebtedness and
obligations under one or more agreements or instruments constituting New Credit
Facilities.
Pursuant to the Tranche A Collateral Documents and the Tranche
B Collateral Documents, the Company has agreed to pledge and grant security
interests in the Collateral as security for the Tranche A Obligations and the
Tranche B Obligations, respectively. The Company also expects to pledge and
grant security interests in the Collateral, pursuant to the Bank Collateral
Documents, as security for any Bank Credit Facility Obligations. The pledges and
security interests referred to above in this paragraph shall have the relative
priorities set forth in this Agreement.
The parties hereto desire to set forth and agree upon such
priorities and upon such other matters relating to the Collateral and certain of
the rights and obligations of the parties hereto in respect thereof and to
provide for the appointment of a collateral agent to hold and otherwise perform
certain duties with respect to the Collateral.
The initial Collateral Agent has been authorized and directed
to enter into this Agreement and to act as such by the Holders as provided in
the Indentures, and each of the Tranche A Trustee and the Tranche B Trustee has
been authorized and directed to enter into this Agreement and to act as the
Junior Secured Creditor as provided herein by the Tranche A Holders or the
Tranche B Holders, as the case may be, as provided in the Tranche A Indenture
and the Tranche B Indenture, respectively.
Accordingly, in consideration of the foregoing and for other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows:
Section 1. Definitions. Terms used but not defined herein
(including in the foregoing recitals) have the meanings assigned to such terms
in the Indentures. In addition, as used herein:
"Bank Agent" means the Person designated in the Bank Credit
Facility as the Bank Agent for purposes of this Agreement.
"Bank Collateral Documents" means the security agreements,
pledge agreements and other documents or instruments executed by the Company to
provide for Liens on Collateral as security for Bank Credit Facility
Obligations.
"Bank Credit Facility" means the Initial Bank Credit Facility
and, at any time, each other New Credit Facility then in effect.
"Bank Credit Facility Obligations" means (i) all present and
future obligations of the Company under the Bank Credit Facility, including in
respect of the principal of, and interest (including interest accruing after the
occurrence and during the continuance of any event of default thereunder,
whether or not a claim for post-filing or post-petition interest is allowed or
allowable under applicable law following the institution of any Insolvency or
Liquidation Proceeding) and premium, if any, payable thereunder and under any
notes issued in connection therewith, fees, reimbursement and indemnification
obligations (including fees and expenses of the Bank Agent payable under Bank
Credit Facility and the Bank Collateral Documents) and all other amounts
outstanding under the Bank Credit Facility (including all such amounts which
would become due but for the operation of the automatic stay under Section
362(a) of the United States Bankruptcy Code or the operation of Sections 502(b)
and 506(b) of the United States Bankruptcy Code), and (ii) all present and
future obligations of the Company under the Bank Collateral Documents, in each
case as the same may be amended, supplemented or otherwise modified and in
effect from time to time; provided that notwithstanding the foregoing
provisions, Bank Credit Facility Obligations shall not include any principal
amount in excess of $60 million.
"Bank Credit Facility Payment Date" means the date on which
(i) all of the Bank Credit Facility Obligations shall have been finally and
indefeasibly paid in full, all commitments to extend credit under the Bank
Credit Facility shall have been terminated and all letters of credit or similar
instruments issued thereunder shall have expired or been terminated (or cash
collateralized as provided in clause (ii) below) and (ii) the Company shall have
furnished the Banks with cash as collateral security in such amounts as the
Banks shall have reasonably determined are necessary to secure the Banks from
loss, cost, damage or expense, including reasonable attorneys' fees and legal
expenses, in connection with contingent Bank Credit Facility Obligations,
including issued and outstanding letters of credit and obligations (other than
general indemnification obligations) as to which the Banks have not yet received
final and indefeasible payment, provided that the Company shall not be required
to furnish the Banks with cash as collateral in respect of any outstanding
letter of credit that exceeds 105% of the undrawn stated amount of such letter
of credit.
2
"Banks" means, at any time and with as respect to the Initial
Bank Credit Facility and each other New Credit Facility, the lenders and agents
parties to such Initial Bank Credit Facility or other New Credit Facility (as
applicable) at such time and, unless the context shall otherwise require, any
agent or representative thereof.
"Bankruptcy Code" means Title 11 of the United States Code
entitled "Bankruptcy," as amended from time to time, or any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect, and all
rules and regulations promulgated thereunder.
"Collateral" has the meaning set forth in Section 3.01 of each
of the Tranche A Pledge Agreement and the Tranche B Pledge Agreement.
"Collateral Agent" means The Bank of New York as initial
Collateral Agent hereunder and its successors as such thereunder, or, at any
time from and after the effectiveness of the Bank Credit Facility and prior to
the Bank Credit Facility Payment Date, any Person designated to act as
collateral agent for purposes of this Agreement by the Banks party to the New
Credit Facility, such designation, if any, to be made in accordance with the
applicable provisions of such New Credit Facility and Section 5 hereof.
"Collateral Documents" means the Bank Collateral Documents,
the Tranche A Collateral Documents and the Tranche B Collateral Documents.
"Holders" means, when used with reference to an Indenture,
Holders, as that term is defined in such Indenture, and otherwise, unless the
context shall otherwise require, the Tranche A Holders and the Tranche B
Holders.
"Indenture" means the Tranche A Indenture and/or the Tranche B
Indenture, as the context shall require, and "Indentures" means the Tranche A
Indenture and the Tranche B Indenture.
"Initial Bank Credit Facility" means the New Credit Facility
first entered into after the date hereof and designated therein as the Initial
Bank Credit Facility for purposes of this Agreement.
"Junior Secured Creditor" means, prior to the Bank Credit
Facility Payment Date, each of the Tranche A Trustee and the Tranche B Trustee
or the Tranche A Trustee and the Tranche B Trustee collectively, as the context
shall require.
"Pledged Equity Interests" has the meaning set forth in the
Tranche A Pledge Agreements and the Tranche B Pledge Agreement.
"Possessory Collateral" means any certificates evidencing the
Pledged Equity Interests and any other Collateral in which a Lien may be
perfected through physical possession by the secured party or an agent therefor
of an instrument or other document evidencing such Collateral.
"Proceeds" has the meaning set forth in Section 3.01(d)
hereof.
3
"Secured Obligations" means the Bank Credit Facility
Obligations, the Tranche A Obligations and the Tranche B Obligations.
"Standstill Period" means each period beginning on the date on
which the Bank Agent receives written notice from the Company or from the
Tranche A Trustee or the Tranche B Trustee of the occurrence of an Event of
Default and terminating on the date that is 180 days later, provided that such
period shall not terminate, and the provisions of Section 3.02 (a) hereof shall
remain in effect, if prior to such date of termination (i) the Bank Agent or the
Banks, or the Collateral Agent at the direction of the Bank Agent or the Banks,
exercise any right or remedy with respect to a sale, foreclosure or other
realization upon any of the Collateral (including taking any action preliminary
thereto) or (ii) an Insolvency or Liquidation Proceeding occurs.
"Tranche A Collateral Documents" means the Tranche A Pledge
Agreement and any other Security Documents (other than this Agreement), as such
term is defined in the Tranche A Indenture.
"Tranche A Holders" means Holders, as that term is defined in
the Tranche A Indenture.
"Tranche A Obligations" means (i) all present and future
obligations of the Company under the Tranche A Indenture and the Tranche A
Notes, including in respect of the principal of, and interest (including
interest accruing after the occurrence and during the continuance of any
Default, whether or not a claim for post-filing or post-petition interest is
allowed or allowable under applicable law following the institution of any
Insolvency or Liquidation Proceeding) and premium, if any, on the Tranche A
Notes, purchase price of Tranche A Notes, fees, reimbursement and
indemnification obligations (including fees and expenses of the Tranche A
Trustee payable under the Tranche A Indenture and under the Tranche A Collateral
Documents) and all other amounts outstanding under the Tranche A Indenture or
the Tranche A Notes (including all such amounts which would become due but for
the operation of the automatic stay under Section 362(a) of the United States
Bankruptcy Code or the operation of Sections 502(b) and 506(b) of the United
States Bankruptcy Code), and (ii) all present and future obligations of the
Company under the Tranche A Collateral Documents, in each case as the same may
be amended, supplemented or otherwise modified and in effect from time to time
(including fees and expenses of the Tranche A Trustee payable under the Tranche
A Indenture and the Tranche A Collateral Documents).
"Tranche A Pledge Agreement" means the Pledge Agreement dated
as of the date hereof between the Company and the Tranche A Trustee, as amended,
supplemented or otherwise modified and in effect from time to time.
"Tranche B Collateral Documents" means the Tranche B Pledge
Agreement and any other Security Documents (other than this Agreement), as such
term is defined in the Tranche B Indenture.
"Tranche B Holders" means Holders, as that term is defined in
the Tranche B Indenture.
4
"Tranche B Obligations" means (i) all present and future
obligations of the Company under the Tranche B Indenture and the Tranche B
Notes, including in respect of the principal of, and interest (including
interest accruing after the occurrence and during the continuance of any
Default, whether or not a claim for post-filing or post-petition interest is
allowed or allowable under applicable law following the institution of any
Insolvency or Liquidation Proceeding) and premium, if any, on the Tranche B
Notes, purchase price of Tranche B Notes, fees, reimbursement and
indemnification obligations (including fees and expenses of the Tranche B
Trustee payable under the Tranche B Indenture and under the Tranche B Collateral
Documents) and all other amounts outstanding under the Tranche B Indenture or
the Tranche B Notes (including all such amounts which would become due but for
the operation of the automatic stay under Section 362(a) of the United States
Bankruptcy Code or the operation of Sections 502(b) and 506(b) of the United
States Bankruptcy Code), and (ii) all present and future obligations of the
Company under the Tranche B Collateral Documents, in each case as the same may
be amended, supplemented or otherwise modified and in effect from time to time
(including fees and expenses of the Tranche B Trustee payable under the Tranche
B Indenture and the Tranche B Collateral Documents).
"Tranche B Pledge Agreement" means the Pledge Agreement dated
as of the date hereof between the Company and the Tranche B Trustee, as amended,
supplemented or otherwise modified and in effect from time to time.
"Trustee" means the Tranche A Trustee and/or the Tranche B
Trustee, as the context shall require, and "Trustees" mean the Tranche A Trustee
and the Tranche B Trustee.
Section 2. Representations and Warranties. The Company
represents and warrants to each of the other parties hereto that:
(a) Organization, Etc. The Company is duly incorporated,
validly existing and in good standing under the laws of the State of Delaware,
is duly qualified to do business and is in good standing as a foreign entity in
each jurisdiction where the nature of its business requires such qualification
and has full power and authority and holds all requisite governmental licenses,
permits and other approvals to enter into and perform its obligations under this
Agreement.
(b) Due Authorization Non-Contravention Etc. The execution,
delivery and performance by the Company of this Agreement are within its
corporate powers, have been duly authorized by all necessary corporate action
and do not contravene any contractual restriction, court decree or order or law
or governmental regulation, in each case binding upon or affecting the Company.
(c) Governmental Approval, Regulation, Etc. No authorization
or approval or other action by, and no notice to or filing with, any
governmental authority or other Person (other than filings and recordings in
respect of Liens created by the Collateral Documents and other than those that
have been duly obtained or made and which are in full force and effect) is
required for (i) the grant by the Company of the Liens granted by the Collateral
Documents or (ii) the due execution, delivery or performance by the Company of
this Agreement.
5
(d) Validity, Etc. This Agreement constitutes the legal, valid
and binding obligation of the Company, enforceable against it in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization or similar laws affecting creditors'
rights generally or by general principles of equity.
(e) Litigation. There is no action or proceeding pending, or
to the knowledge of the Company threatened, against the Company that contests or
challenges the ability of the Company to enter into or perform its obligations
under this Agreement.
Section 3. Priority of Liens.
3.01. Subordination. (a)Each the parties hereto agrees that,
as further set forth in subsections (b), (c) and (d) of this Section 3, and
notwithstanding anything in the Bank Collateral Documents, the Tranche A
Collateral Documents or the Tranche B Collateral Documents to the contrary, as
among the Liens securing the Secured Obligations, (i) the Liens securing the
Bank Credit Facility Obligations shall be first priority Liens, (ii) the Liens
securing the Tranche A Obligations and the Tranche B Obligations shall be, with
respect to the Liens securing the Bank Credit Facility Obligations, second
priority and subordinated Liens and (iii) the Liens securing the Tranche A
Obligations and the Tranche B Obligations shall be, with respect to each other,
pari passu and of the same ranking and priority, provided that the provisions of
this clause (iii) shall not be deemed to affect the provisions of clause (i) of
the third sentence of Section 3.09(a) of the Tranche B Indenture.
(b) Notwithstanding anything in the Tranche A Indenture or the
Tranche A Collateral Documents to the contrary, the Tranche A Trustee, on behalf
of itself and the Tranche A Holders, hereby agrees that, regardless of the
relative times of attachment or perfection thereof or the order of filing of
financing statements or other documents or any provision of the Uniform
Commercial Code or any other applicable law to the contrary, (i) the Liens
granted in favor of the Tranche A Trustee pursuant to the Tranche A Collateral
Documents shall in all respects be junior and subordinate to the Liens granted
or to be granted to the Banks in respect of the Collateral as security for the
Bank Credit Facility Obligations (without regard to whether any such Lien shall
be perfected or avoidable) and (ii) except as provided in the proviso to Section
3.02(b) hereof or in the proviso to Section 3.03 (a) hereof, all of the rights
and remedies of the Tranche A Trustee hereunder or under the Tranche A Indenture
or the Tranche A Collateral Documents in respect of the Collateral are hereby
expressly made, and at all times will be, subject and subordinate in all
respects to any Liens thereon now existing, or that may in the future be
created, as security for the Bank Credit Facility Obligations and to the rights
and remedies of the Banks in respect thereof. The Tranche A Trustee further
agrees, on behalf of itself and the Tranche A Holders, that it shall not (and
hereby waives any right to) take any action to contest or challenge the
validity, priority, enforceability or perfection of the Liens of the Banks on
the Collateral.
(c) Notwithstanding anything in the Tranche B Indenture or the
Tranche B Collateral Documents to the contrary, the Tranche B Trustee, on behalf
of itself and the Tranche B Holders, hereby agrees that, regardless of the
relative times of attachment or perfection thereof or the order of filing of
financing statements or other documents or any provision of the Uniform
Commercial Code or any other applicable law to the contrary, (i) the
6
Liens granted in favor of the Tranche B Trustee pursuant to the Tranche B
Collateral Documents shall in all respects be junior and subordinate to the
Liens granted or to be granted to the Banks in respect of the Collateral as
security for the Bank Credit Facility Obligations (without regard to whether any
such Lien shall be perfected or avoidable) and (ii) except as provided in the
proviso to Section 3.02(b) hereof or in the proviso to Section 3.03(a) hereof,
all of the rights and remedies of the Tranche B Trustee hereunder or under the
Tranche B Indenture or the Tranche B Collateral Document in respect of the
Collateral are hereby expressly made, and at all times will be, subject and
subordinate in all respects to any Liens thereon now existing, or that may in
the future be created, as security for the Bank Credit Facility Obligations and
to the rights and remedies of the Banks in respect thereof. The Tranche B
Trustee further agrees, on behalf of itself and the Tranche B Holders, that it
shall not (and hereby waives any right to) take any action to contest or
challenge the validity, priority, enforceability or perfection of the Liens of
the Banks on the Collateral.
(d) Notwithstanding anything to the contrary contained in the
Tranche A Indenture or the Tranche A Collateral Documents, or in the Tranche B
Indenture or the Tranche B Collateral Documents, all proceeds received in
respect of any sale, disposition or release of, any collection from or any other
realization upon all or any part of the Collateral ("Proceeds") by the
Collateral Agent or the Banks pursuant to this Agreement or the Bank Collateral
Documents, or by the Collateral Agent, the Tranche A Trustee or the Tranche B
Trustee pursuant to this Agreement or the Tranche A Collateral Documents or the
Tranche B Collateral Documents, as the case may be, shall, to the extent
available for distribution at any time, and except as otherwise provided in the
Bank Credit Facility or the Bank Collateral Documents, be applied to the Secured
Obligations in the following order of priority:
First, to the payment of all Bank Credit Facility Obligations,
Second, to the extent of any excess, to the payment of all
Tranche A Obligations and Tranche B Obligations, equally and ratably in
accordance with the provisions of the Indentures (but subject to the
provisions of clause (i) of the third sentence of Section 3.09(a) of
the Tranche B Indenture) and the Tranche A Collateral Documents and the
Tranche B Collateral Documents, and
Third, any surplus then remaining to the Company or its
successors or assigns or to whomsoever may be lawfully entitled to
receive the same or as a court of competent jurisdiction may direct.
(e) Each of the parties hereto acknowledges that the foregoing
provisions of this Section 3.01 provide for priority and subordination only with
respect to (i) Liens on the Collateral, (ii) the distribution of Proceeds of the
Collateral as described above and (iii) the application of Net Proceeds from
Principal Asset Sales as described in Section 3.08 hereof, and do not constitute
(and none of the other provisions of this Agreement constitute) an agreement
with respect to contractual subordination of or with respect to any of the
Tranche A Obligations or Tranche B Obligations, except as expressly set forth
herein with respect to the foregoing matters.
7
3.02. Certain Enforcement Actions. Prior to the Bank Credit Facility
Payment Date, the Junior Secured Creditor will not, without the prior written
consent of the Bank Agent,
(a) during the Standstill Period, commence any action, whether judicial or
otherwise, for the enforcement of the Junior Secured Creditor's rights or
remedies as a secured creditor with respect to the Collateral or any Liens on
the Collateral, including commencement of an Insolvency or Liquidation
Proceeding against the Company or commencement of, or participation in, any
execution, levy, receivership or foreclosure proceedings against, or any other
sale of, collection on, or disposition of, any Collateral or in respect of any
Liens on the Collateral or any Proceeds thereof, or any other exercise of rights
or remedies with respect to any of the Collateral or in respect of any Liens on
the Collateral (including any collection proceedings with respect to any of the
Collateral); or
(b) following the commencement of an Insolvency or Liquidation Proceeding
against the Company, exercise any rights afforded to secured creditors in a case
under the Bankruptcy Code with respect to the Collateral or any Liens on the
Collateral or take any other action under the Bankruptcy Code that directly
affects the Collateral or any Liens on the Collateral, provided that (x) the
foregoing shall not be deemed to prevent the taking of any action by the Junior
Secured Creditor to the extent that the same relates to or affects all or
substantially all of the property of the bankruptcy estate of the Company and
(y) the Junior Secured Creditor and the Holders may make such demands and file
such claims or documents as may be necessary to prevent the waiver or bar under
applicable statutes of limitations or other statutes, court orders or rules of
procedure of any claims held by them.
The foregoing provisions of this Section 3.02 shall not prevent the Junior
Secured Creditor or any of the Holders from making any demand or bringing any
action for payment or declaring a Default or an Event of Default or exercising
their rights to accelerate Indebtedness of the Company pursuant to the
provisions of the Tranche A Indenture or the Tranche B Indenture, as the case
may be, or otherwise exercising their rights as unsecured creditors.
After the Bank Credit Facility Payment Date, the Junior Secured Creditor
shall not be restricted by the provisions of this Agreement from exercising any
and all rights and remedies it may have as a creditor under applicable law,
including rights and remedies with respect to any of the Collateral.
3.03. Certain Matters Pertaining to Insolvency Proceedings. In addition to,
and without limiting the generality of Section 3.02 hereof, the Junior Secured
Creditor agrees on behalf of the Holders that in the event of an Insolvency or
Liquidation Proceeding involving the Company that occurs prior to the Bank
Credit Agreement Payment Date:
(a) the Junior Secured Creditor will not (i) pursue any remedies with
respect to the Collateral or any Liens on the Collateral in such proceeding,
including seeking relief from any stay that is not supported by the Banks (or
such of the Banks as shall be provided in the Bank Credit Facility) or (ii)
oppose, hinder or interfere with any sale under Section 363 of the Bankruptcy
Code of all or any portion of the Collateral which has the support of the Banks
(or such of the Banks as shall be provided in the Bank Credit Facility),
provided that nothing in this Section 3.03(a) will (v) affect the exercise by
the Junior Secured Creditor and the Holders of
8
their rights to vote on a reorganization plan or to determine how they are to
vote, (w) prevent the Junior Secured Creditor or the Holders from exercising any
rights to which they are entitled by virtue of the TIA, (x) prevent the Junior
Secured Creditor from seeking any order or determination by the court before
which such Insolvency or Liquidation Proceeding is pending with respect to the
protection or preservation of the Collateral or the rights of the Junior Secured
Creditor with respect thereto or the proceeds thereof, but in any event
consistent with the priorities set forth in this Agreement, (y) prevent the
Junior Secured Creditor or any of the Holders from offering to acquire any of
the Bank Credit Facility Obligations or from bidding for or acquiring Collateral
in any sale thereof or (z) affect the rights of the Junior Secured Creditor
under any of the provisions of Section 3.02 hereof;
(b) the Junior Secured Creditor will not cause the Company or a bankruptcy
trustee therefor to seek to surcharge the Collateral or to finance any surcharge
action (other than in respect of fees and expenses of the Junior Secured
Creditor on a subordinated basis consistent with this Agreement);
(c) the Junior Secured Creditor waives any actions, claims or rights
against the Banks arising out of the election of the Banks of the application of
Section 1111(b)(2) of the Bankruptcy Code, or which might arise from any matter
approved by the Bankruptcy Court, including the use of cash collateral,
debtor-in-possession financing arrangements, the grant of security interests or
receipt and application of payments from the debtor's estate; and
(d) the Junior Secured Creditor will not object to the provision by the
Banks of debtor-in-possession financing on the ground that its interests are not
adequately protected under the terms of the debtor-in-possession financing
arrangement, provided that nothing in this sentence shall preclude the Junior
Secured Creditor of the Holders from objecting to such debtor-in-possession
financing on any ground on which an unsecured creditor could object or from
seeking to obtain junior and subordinated liens on assets that constitute
collateral for such financing.
3.04. Certain Actions With Respect to Liens.
(a) Turnover of Collateral. All payments or distributions of or with
respect to the Collateral that are received by the Junior Secured Creditor
hereunder at any time prior to the Bank Credit Facility Payment Date shall be
segregated from other funds and property held by the Junior Secured Creditor and
held in trust for the benefit of the Banks, and the Junior Secured Creditor
shall forthwith pay over to the Collateral Agent such amounts in the same form
as so received (with any necessary endorsement) to be applied or held as
Collateral in accordance with the provisions hereof and of the Bank Credit
Facility. The Junior Secured Creditor, on behalf of itself and the Holders,
hereby irrevocably and unconditionally waives and relinquishes all statutory,
contractual, common law, equitable and other claims against the Company and any
Collateral for subrogation, reimbursement, exoneration, contribution,
indemnification, set-off or other recourse in respect of sums paid or payable to
the Banks hereunder and further irrevocably and unconditionally waives and
relinquishes any and all other benefits which the Junior Secured Creditor might
otherwise directly or indirectly receive or be entitled to receive by reason of
any amounts paid by or collected upon or realized from the Collateral, in each
case prior to the Bank Credit Facility Payment Date.
9
(b) Turnover by Banks upon Payment in Full. Effective upon the first
Business Day after the Bank Credit Facility Payment Date, except under the
circumstances described in Section 3.04(c) hereof, the Company will cause the
Bank Agent, at the cost and expense of the Company, to promptly execute and
deliver all such instruments and documents, and take all such actions, as shall
be necessary or that the Collateral Agent or the Junior Secured Creditor may
reasonably request, to evidence or confirm the termination of the Lien
subordination created under this Agreement and, in that connection, to cause the
Bank Agent to deliver to the Collateral Agent, without recourse and without
representation or warranty of any kind, all Collateral, all Proceeds thereof and
all certificates, instruments or other documents evidencing or representing any
of the Collateral, at the time held by the Bank Agent or the Banks pursuant to
this Agreement or the Bank Collateral Documents; provided that the Bank Agent
shall not be required to deliver or pay over any of the foregoing, execute any
instruments or documents or take any other action referred to in this Section
3.04(b) to the extent that such action would contravene any law, order or other
legal requirement, and in the event of a controversy or dispute, the Bank Agent
may interplead any moneys or other property in any court of competent
jurisdiction.
(c) Reinstatement. If, after receipt of any payment of, or receipt of any
Proceeds of Collateral applied to the payment of, any of the Bank Credit
Facility Obligations (including upon the insolvency, bankruptcy or
reorganization of the Company), the Banks are required to surrender or return
such payment or Proceeds to any Person for any reason (including upon any such
insolvency, bankruptcy or reorganization), then the Bank Credit Facility
Obligations intended to be satisfied by such payment or Proceeds shall be
reinstated and shall continue and this Agreement shall continue in full force
and effect as if such payment or Proceeds had not been received by the Bank
Agent or the Banks. In any such event, the Collateral Agent shall thereafter,
upon receipt of any Collateral, Proceeds thereof or certificates, instruments or
other documents, and until the Bank Credit Facility Payment Date, hold the same
as Collateral hereunder. This Section 3.04(c) shall remain effective
notwithstanding any contrary action which may be taken by the Bank Agent or the
Banks in reliance upon such payment or Proceeds and shall survive the
termination of this Agreement.
(d) Asset Sales. The Banks and the Bank Agent acknowledge and agree that
upon a Principal Asset Sale any Liens of the Banks on any assets or equity
interests being sold in such Principal Asset Sale shall be released, provided
that Net Proceeds of such Principal Asset Sale are applied to the Bank Credit
Facility Obligations in accordance with the provisions of Section 3.09 of the
Indentures.
3.05. Perfection of Security Interests. For the limited purpose of
perfecting the Liens in the Collateral of the Bank Agent and the Banks, the
Tranche A Trustee and the Tranche A Holders and the Tranche B Trustee and the
Tranche B Holders, the Collateral Agent agrees that it will (a) in the case of
Possessory Collateral, subject to the provisions of this Section 3 and Section 4
hereof, take possession of and hold such Possessory Collateral as agent, as
security for the Bank Agent, the Tranche A Trustee and the Tranche B Trustee and
the respective holders of the Secured Obligations, and (b) in the case of
Collateral consisting of cash, at the direction of the Bank Agent prior to the
Bank Credit Facility Payment Date and at the direction of the Trustees from and
after such date (or from the date hereof until the effectiveness of the Initial
Bank Credit Facility), enter into such agreements as shall enable the Bank Agent
or the Tranche
10
A Trustee and the Tranche B Trustee to have "control" over such Collateral
(within the meaning of the applicable provisions of the Uniform Commercial
Code), but with such control on the part of the Tranche A Trustee and the
Tranche B Trustee being subject and subordinate to the control and rights of the
Bank Agent and the Banks in such Collateral under the Bank Credit Facility. In
that connection, it is understood and agreed that (i) neither the Collateral
Agent, the Bank Agent or any of the Banks or the Trustees or any of the Holders
makes any representation as to the value of the Collateral or any part thereof,
or as to the security afforded by this Agreement or the Collateral Documents or
as to the validity, execution, enforceability, legality or sufficiency of this
Agreement or the Collateral Documents or of the Secured Obligations, and none of
the Collateral Agent, the Bank Agent or the Banks or the Trustees or any of the
Holders shall incur any liability or responsibility in respect of any such
matters and (ii) none of them shall be required to ascertain or inquire as to
the performance by the Company of any of the covenants or agreements contained
herein or in any such documents.
3.06. Control of Dispositions of Collateral.
(a) Dispositions Free of Liens. The Junior Secured Creditor, on
behalf of itself and the Holders, hereby agrees that any collection, sale or
other disposition of Collateral (whether under the Uniform Commercial Code or
otherwise) by the Collateral Agent, the Bank Agent or the Banks shall be free
and clear of any Liens of the Junior Secured Creditor in such Collateral (even
if the Banks shall become the owner of such Collateral), provided that the Bank
Agent shall have given the Junior Secured Creditor not less than 20 days' prior
written notice of any such sale or other disposition; and provided further that
the Junior Secured Creditor shall retain a Lien (having the same priority as the
Lien it previously had on the Collateral that was collected, sold or otherwise
disposed of) on the Proceeds thereof except (i) to the extent that such Proceeds
are applied to the Bank Credit Facility Obligations or (ii) the Banks apply Bank
Credit Facility Obligations to the purchase of such Collateral, whether through
offset, bidding in the same in an auction or otherwise.
(b) Release to Facilitate Disposition. To the extent requested by
the Bank Agent, the Junior Secured Creditor will promptly execute and deliver
and otherwise cooperate in providing any necessary or appropriate releases to
permit a collection, sale or other disposition of Collateral, as provided in
Section 3.06(a) hereof, by the Bank Agent or the Banks free and clear of the
Liens of the Junior Secured Creditor.
(c) Waiver of Marshalling. The Junior Secured Creditor, on behalf
of itself and the Holders, hereby waives any right to require the Banks to
marshal assets in its favor or to proceed against any Collateral, or any other
property, assets or collateral provided by the Company or any other Person as
security for the Bank Credit Facility Obligations, and agrees that the Bank
Agent and the Banks may proceed against the Company, any Collateral or any such
other property, assets or other collateral provided by the Company or by any
other Person, in such order and at such times as the Banks shall determine.
(d) Exercise of Remedies. Prior to the Bank Credit Facility
Payment Date, the Collateral Agent shall follow the directions of the Bank Agent
with respect to the enforcement by the Bank Agent of rights and remedies with
respect to the Collateral, subject to the rights of the Junior Secured Creditor
under Sections 3.02 and 3.03 hereof and to the
11
provisions of the Bank Credit Facility referred to in the second sentence of
Section 6.12 hereof. From and after the Bank Credit Facility Payment Date (or
from the date hereof until the effectiveness of the Initial Bank Credit
Facility), the Collateral Agent shall follow the directions of the Tranche A
Trustee and the Tranche B Trustee with respect to the enforcement by the
Trustees of rights and remedies with respect to the Collateral, subject to the
provisions of the Indentures referred to in the third sentence of Section 6.12
hereof.
3.07. Payment of Proceeds.
(a) Payments to Bank Agent. The Collateral Agent shall make payments of
Proceeds to the Bank Agent pursuant to clause First of Section 3.01(d) hereof
upon receipt of a certificate of the Bank Agent, specifying the amount so to be
paid and the application thereof to principal, interest or other amounts
constituting Bank Credit Facility Obligations.
(b) Payments to Trustees. The Collateral Agent shall make payments of
Proceeds to the Tranche A Trustee and/or the Tranche B Trustee pursuant to
clause Second of Section 3.01(d) hereof upon receipt of an order of each of the
Trustees, accompanied by an Officers' Certificate of the Company specifying the
amount or amounts thereof so to be paid and the application thereof to the
Tranche A Notes and/or the Tranche B Notes, and to principal, interest or other
amounts constituting Tranche A Obligations and/or Tranche B Obligations, which
Officers' Certificate shall comply with any applicable requirements of Sections
5.03, 7.01 and 7.02 of the Tranche A Pledge Agreement and/or the Tranche B
Pledge Agreement, together with any Opinion of Counsel or other documents
required pursuant to such Sections to be provided by the Company in respect of
such payment or payments.
3.08. Application of Net Proceeds from Principal Asset Sales.
The parties hereto hereby agree that the Net Proceeds from any
Principal Asset Sale shall be applied in the following order of priority:
First, to the payment of any unpaid fees and expenses of the Collateral
Agent hereunder and then to the payment of all Bank Credit Facility Obligations,
Second, to fund Cash on Hand (as defined in the Plan),
Third, to the payment of all Tranche A Obligations and Tranche B
Obligations, equally and ratably in accordance with the provisions of the
Indentures (but subject to the provisions of clause (i) of the third sentence of
Section 3.09(a) of the Tranche B Indenture) and the Tranche A Collateral
Documents and the Tranche B Collateral Documents, and
Fourth, any surplus then remaining to the Company or as otherwise
required by the Plan.
Section 4. Bank Credit Facility Reliance, Modifications, Etc.
4.01. Notice of Acceptance, Etc. All Bank Credit Facility Obligations
at any time made or incurred by any of the Banks under the Bank Credit Facility
shall be deemed to have been made or incurred in reliance upon this Agreement,
and the Junior Secured Creditor, on behalf of itself and the Holders, hereby
waives (i) notice of acceptance by the Banks of this
12
Agreement, (ii) notice of the existence or creation or non-payment of all or any
part of the Bank Credit Facility Obligations and (iii) protest, demand for
payment and notice of default. Nothing herein shall be deemed to supersede any
obligation of the Company to provide any notice to a Trustee or the Holders
under an Indenture.
4.02. Modifications to Documents. The Collateral Agent, and each of the
Trustees, on behalf of itself and the Holders, hereby agrees that, without
affecting the obligations hereunder of the Collateral Agent, the Trustees or the
Holders, the Banks may, at any time and from time to time, in their sole
discretion without the consent of or notice to the Collateral Agent, the
Trustees or any Holder, and without incurring any liability to the Trustees or
any Holder or impairing or releasing the Lien priority and Lien subordination
provided for herein, amend, restate, supplement, terminate (in whole or in part)
or otherwise modify the Bank Credit Facility in any manner whatsoever (but
subject to the proviso contained in the definition herein of the term "Bank
Credit Facility Obligations"), including to:
(a) rescind in whole or in part any demand for payment of any Bank Credit
Facility Obligation made by the Banks or to continue any Bank Credit Facility
Obligation,
(b) change the manner, place or terms of payment or extend the time of
payment of or renew or alter all or any of the Bank Credit Facility Obligations
or otherwise amend, restate, supplement, compromise or otherwise modify in any
manner, or grant any waiver or release with respect to, all or any part of the
Bank Credit Facility Obligations or the Bank Credit Facility,
(c) retain or obtain a Lien on any property to secure any of the Bank
Credit Facility Obligations and in that connection to enter into any additional
agreements with the Company or any of its Subsidiaries,
(d) amend, or grant any waiver, compromise or release with respect to, or
consent to any departure from, any guaranty or other obligation of any Person
obligated in any manner under the Bank Credit Facility or in respect of the Bank
Credit Facility Obligations,
(e) release their Lien on any property of the Company or any of its
Subsidiaries, or sell, exchange, or surrender any such property at any time held
as collateral security,
(f) exercise or refrain from exercising any rights against the Company or
any other Person, including to declare any of the Bank Credit Facility
Obligations to be due and payable,
(g) retain or obtain the primary or secondary obligation of any other
Person with respect to any of the Bank Credit Facility Obligations, and
(h) otherwise manage and supervise the Bank Credit Facility Obligations
as the Banks shall deem appropriate.
13
4.03. Liability of Banks. The Junior Secured Creditor, on behalf of
itself and the Holders, agrees that no Bank shall have any liability for any
action taken or omitted to be taken by any of them with respect to any
Collateral or any Lien thereon or any matter arising out of or in connection
with this Agreement, except for liability arising directly from such Bank's
gross negligence or willful misconduct, as determined in a final non-applicable
order of a court of competent jurisdiction.
4.04. Further Assurances. The Junior Secured Creditor agrees, at the
expense of the Company, to execute and deliver such further documents and to do
such other lawful acts and things as the Banks may reasonably request in order
fully to effect the Lien subordination provided for in Section 3 hereof.
Section 5. Changes of Collateral Agent.
5.01. Replacement by Bank Representative. Concurrently with the
effectiveness of the Initial Bank Credit Facility, the Person, if any, specified
for such purpose in such Facility (who may be the Bank Agent) will, upon
execution and delivery of a joinder agreement reasonably satisfactory to the
Trustees, become a party to this Agreement and the Collateral Agent hereunder,
and, in such event, the Person named herein as the initial Collateral Agent
shall be deemed to have resigned as such at such time.
5.02. Replacement by Trustee. If upon the occurrence of the Bank Credit
Facility Payment Date, one of the Trustees is not then serving as the Collateral
Agent, the Trustees may, by order or orders executed by the Trustees, replace
the then serving Collateral Agent with one of the Trustees, as specified in such
order or orders, and in such event such Collateral Agent shall be deemed to have
resigned at such time.
Section 6. Miscellaneous.
6.01. No Waiver. No failure on the part of the Collateral Agent, the Bank
Agent, the Tranche A Trustee or the Tranche B Trustee to exercise, and no course
of dealing with respect to, and no delay in exercising, any right, power or
remedy hereunder shall operate as a waiver thereof; nor shall any single or
partial exercise by the Collateral Agent, the Bank Agent, the Tranche A Trustee
or the Tranche B Trustee of any right, power or remedy hereunder preclude any
other or further exercise thereof or the exercise of any other right, power or
remedy. The remedies herein are cumulative and are not exclusive of any remedies
provided by law.
6.02. Notices. All notices, requests, demands and other communications
provided for or permitted hereunder shall be in writing (including telex and
telecopy communications) and shall be sent to the addresses and in the manner
provided for in the applicable provisions of the Bank Credit Facility, in the
case of the Bank Agent and in the case of the Collateral Agent if the Collateral
Agent is designated pursuant to the Bank Credit Facility, or in Section 11.02 of
the respective Indentures, in the case of the Tranche A Trustee and the Tranche
B Trustee and in the case of the Collateral Agent if the Collateral Agent is a
Trustee.
6.03. Expenses. Without limitation of any of the provisions of the Bank
Credit Facility or the Indentures, the Company agrees to reimburse the
Collateral Agent, the Bank Agent and each of the Trustees for all reasonable
costs and expenses (including the reasonable
14
fees and expenses of their respective legal counsel) in connection with (i) any
event of default under the Bank Credit Facility or an Indenture and any
enforcement or collection proceeding resulting therefrom, including all manner
of participation in or other involvement with (w) any performance by the Bank
Agent or a Trustee of any obligations of the Company in respect of the
Collateral that the Company has failed or refused to perform, (x) bankruptcy,
insolvency, receivership, foreclosure, winding up or liquidation proceedings,
and any actual or attempted sale of, or any exchange, enforcement, collection,
compromise or settlement in respect of, any of the Collateral, and for the care
of the Collateral and defending or asserting rights and claims in respect
thereof, by litigation or otherwise, (y) judicial or regulatory proceedings and
(z) workout, restructuring or other negotiations or proceedings (whether or not
the workout, restructuring or transaction contemplated thereby is consummated)
and (ii) the enforcement of this Section 6.03, and all such costs and expenses
shall be Secured Obligations entitled to the benefits of the Collateral.
In addition to the foregoing, the Company shall pay or reimburse the
Collateral Agent, the Bank Agent and each of Trustees for all stamp, filing and
transfer fees, taxes (other than income taxes in respect of the compensation
received by any of them under the Bank Credit Facility or an Indenture), and
other similar imposts which may be payable or determined to be payable in
respect of the execution, delivery, performance and enforcement of this
Agreement or any Secured Obligation. Any amounts due from the Company under this
Section 6.03 shall be in addition to (and not in limitation of) any amounts due
under the Bank Credit Facility or the Indentures.
6.04. Amendments, Etc. The terms of this Agreement may be waived, altered
or amended only by an instrument in writing duly executed by the Company (but
only if its rights or obligations are affected by such waiver, alteration or
amendment), the Collateral Agent, the Bank Agent, the Tranche A Trustee and the
Tranche B Trustee. Any such action by the Bank Agent, or any other action to be
taken by the Bank Agent pursuant to or in connection with this Agreement, shall
be taken by the Bank Agent upon the direction or with the consent of the Banks,
or such of the Banks as shall be provided in (and to the extent required by) the
provisions of the Bank Credit Facility. Any such action by the Tranche A Trustee
or the Tranche B Trustee, or any other action to be taken by the Tranche A
Trustee or the Tranche B Trustee pursuant to or in connection with this
Agreement, shall be taken by such Trustee upon the written direction or with the
written consent of the Tranche A Holders or the Tranche B Holders, as the case
may be, or such of the Holders as shall be provided in (and to the extent
required by) the provisions of the Tranche A Indenture or the Tranche B
Indenture, as the case may be.
The Company and each of the Trustees agree that they will not, prior to
the Bank Credit Facility Payment Date, amend any provisions of the Collateral
Documents to which they are parties, or any provisions of Section 3.09(a) of the
respective Indentures in any manner adverse to the Banks, or any provisions of
the Indentures that define terms that are used in this Agreement, without the
prior written consent of the Bank Agent.
6.05. Successors and Assigns. This Agreement shall be binding upon and
inure to the benefit of the respective successors and assigns of the Company,
the Collateral Agent, the Bank Agent, the Banks, the Tranche A Trustee, the
Tranche B Trustee and the Holders (provided, however, that the Company shall not
assign or transfer its rights or obligations
15
hereunder, except pursuant to a transaction permitted under Article V of the
Indentures, without the prior written consent of the Bank Agent and each of the
Trustees).
The Lien priority and Lien subordination provisions contained in Section
3, and the provisions of Section 4, are for the benefit of the Banks and their
respective successors and assigns and may not be rescinded or cancelled or
modified in any way, nor may any such provision be waived or changed, without
the prior written consent of the Bank Agent, determined as provided Section 6.04
hereof. All such provisions contained herein may be enforced directly by the
Bank Agent against the Tranche A Trustee, the Tranche B Trustee and the Company.
6.06. Captions. The captions and section headings appearing herein are
included solely for convenience of reference and are not intended to
affect the interpretation of any provision of this Agreement.
6.07. Counterparts. This Agreement may be executed in any number of
counterparts, all of which taken together shall constitute one and the same
instrument, and any of the parties hereto may execute this Agreement by signing
any such counterpart.
6.08. Governing Law. This Agreement shall be governed by, and construed
in accordance with, the internal laws of the State of New York (including
Section 5-1401 of the General Obligations Law).
6.09. SUBMISSION TO JURISDICTION; SERVICE OF PROCESS; ATTORNEYS' FEES.
EACH PARTY HERETO MAY ENFORCE ANY CLAIM ARISING OUT OF THIS AGREEMENT IN ANY
STATE OR FEDERAL COURT HAVING SUBJECT MATTER JURISDICTION AND LOCATED IN THE
CITY OF NEW YORK, NEW YORK. FOR THE PURPOSE OF ANY ACTION OR PROCEEDING
INSTITUTED WITH RESPECT TO ANY SUCH CLAIM, EACH OF THE PARTIES HERETO HEREBY
IRREVOCABLY SUBMITS TO THE JURISDICTION OF SUCH COURTS AND IRREVOCABLY CONSENTS
TO THE SERVICE OF PROCESS OUT OF SUCH COURTS BY MAILING A COPY THEREOF, BY
REGISTERED MAIL, POSTAGE PREPAID, TO SUCH PERSON AT SUCH PERSON'S ADDRESS
PROVIDED FOR HEREIN AND AGREES THAT SUCH SERVICE, TO THE FULLEST EXTENT
PERMITTED BY LAW, (i) SHALL BE DEEMED IN EVERY RESPECT EFFECTIVE SERVICE OF
PROCESS UPON SUCH PERSON IN ANY SUCH SUIT, ACTION OR PROCEEDING AND (ii) SHALL
BE TAKEN AND HELD TO BE VALID PERSONAL SERVICE UPON AND PERSONAL DELIVERY TO
SUCH PERSON. NOTHING CONTAINED HEREIN SHALL AFFECT THE RIGHTS OF THE PARTIES TO
SERVE PROCESS IN ANY OTHER MANNER PERMITTED BY LAW OR PRECLUDE THE PARTIES
HERETO FROM BRINGING AN ACTION OR PROCEEDING IN RESPECT HEREOF IN ANY OTHER
PLACE HAVING JURISDICTION OVER SUCH ACTION. THE PARTIES HERETO HEREBY
IRREVOCABLY WAIVE, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH
SUCH PERSON NOW OR HEREAFTER MAY HAVE TO THE LAYING OF THE VENUE OF ANY SUCH
SUIT, ACTION OR PROCEEDING BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY
CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING HAS BEEN BROUGHT IN AN
INCONVENIENT FORUM.
16
6.10. Severability. If any provision hereof is invalid and unenforceable
in any jurisdiction, then, to the fullest extent permitted by law, (i) the other
provisions hereof shall remain in full force and effect in such jurisdiction and
shall be liberally construed in order to carry out the intentions of the parties
hereto as nearly as may be possible and (ii) the invalidity or unenforceability
of any provision hereof in any jurisdiction shall not affect the validity or
enforceability of such provision in any other jurisdiction.
6.11. Information as to Bank Credit Facility. The Bank Agent shall
deliver or cause to be delivered to the Collateral Agent from time to time upon
request a list setting forth the aggregate principal amount of Indebtedness
outstanding under the Bank Credit Facility and the names of the Banks.
6.12. No Limitation upon Bank Credit Facility or Indentures; Certain
Provisions Applicable Hereunder. Except as expressly set forth herein, nothing
in this Agreement shall be deemed to alter, impair or limit the obligations of
the Company, or the rights of the Bank Agent or the Banks, the rights of the
Tranche A Trustee and the Tranche A Holders or the rights of the Tranche B
Trustee and the Tranche B Holders, as the case may be, under the Bank Credit
Facility or the respective Indentures. The provisions of the Bank Credit
Facility relating to payment by the Company of fees, costs and expenses,
indemnification by the Company and standards of care or conduct and other
matters relating to exculpation shall be equally applicable to the rights and
obligations hereunder of the Collateral Agent (if the Collateral Agent is
designated pursuant to the Bank Credit Facility) and the Bank Agent to the same
extent if all such provisions were set forth in this Agreement. The provisions
of Sections 7.01, 7.02 and 7.07 of the respective Indentures shall be equally
applicable to the rights and obligations hereunder of the Collateral Agent (if
the Collateral Agent is a Trustee) and the Tranche A Trustee and the Tranche B
Trustee, to the same extent as if all such provisions were set forth in this
Agreement.
6.13. No Third Party Beneficiaries. This Agreement is entered into for
the benefit of the parties hereto, the Banks, the Bank Agent, the Holders and
their respective successors and assigns, and no other Person shall have any
rights or interests hereunder or be a beneficiary hereof.
6.14. Intercreditor Agreement Controls. In the event of any conflict or
inconsistency between the provisions of this Agreement and the provisions of any
of the Collateral Documents, the Bank Credit Facility or the Indentures, the
provisions of this Agreement shall control.
6.15. Termination. Upon the final and indefeasible payment in full of the
Secured Obligations, this Agreement shall terminate, and the Collateral Agent
shall forthwith cause to be assigned, transferred and delivered, against written
receipt but without any recourse, warranty or representation whatsoever, any
remaining Collateral held by the Collateral Agent to or on the order of the
Company. The Collateral Agent shall also execute and deliver to the Company upon
such termination or release of Collateral such Uniform Commercial Code
termination statements and such other documentation and take such other actions
as shall be reasonably requested by, and at the expense of, the Company to
effect, or in connection with, the termination and release of the Liens on the
Collateral.
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IN WITNESS WHEREOF, the parties hereto have caused this Collateral Agency
and Intercreditor Agreement to be duly executed and delivered as of the day and
year first above written.
NATIONAL ENERGY & GAS
TRANSMISSION, INC.
By:
------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Collateral Agent
By:
------------------------
Name:
Title:
THE BANK OF NEW YORK,
as Tranche A Trustee
By:
------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as Tranche B Trustee
By:
------------------------
Name:
Title:
18