<PAGE> 1
EXHIBIT 4.1
================================================================================
WILLIAMS COMMUNICATIONS GROUP, INC.
AND
The Bank of New York, Trustee
Indenture
Dated as of August 8, 2000
----------
$1,000,000,000
11.70% Senior Redeemable Notes Due 2008
11.875% Senior Redeemable Notes Due 2010
================================================================================
<PAGE> 2
TABLE OF CONTENTS
----------
<TABLE>
<CAPTION>
PAGE
----
ARTICLE 1
DEFINITIONS
<S> <C> <C>
SECTION 1.01. Certain Terms Defined...........................................................15
SECTION 1.02. Other Definitions...............................................................52
ARTICLE 2
ISSUE, EXECUTION, FORM AND REGISTRATION OF NOTES
SECTION 2.01. Authentication and Delivery of Notes............................................52
SECTION 2.02. Execution of Notes..............................................................53
SECTION 2.03. Certificate of Authentication...................................................53
SECTION 2.04. Form, Denomination and Date of Notes; Payments of
Interest..............................................................................53
SECTION 2.05. Restricted Legend...............................................................54
SECTION 2.06. Restrictions on Transfers and Exchange..........................................55
SECTION 2.07. Registration, Transfer and Exchange.............................................55
SECTION 2.08. Book-Entry Provisions for Global Notes..........................................57
SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Notes............................59
SECTION 2.10. Cancellation of Notes...........................................................60
SECTION 2.11. Temporary Notes.................................................................60
SECTION 2.12. CUSIP Numbers...................................................................61
ARTICLE 3
COVENANTS OF THE COMPANY AND THE TRUSTEE
SECTION 3.01. Payment of Principal and Interest...............................................61
SECTION 3.02. Offices for Payments, etc.......................................................61
SECTION 3.03. Appointment to Fill a Vacancy in Office of Trustee..............................61
SECTION 3.04. Paying Agents...................................................................62
SECTION 3.05. Certificates to Trustee.........................................................63
SECTION 3.06. Noteholders' Lists..............................................................63
SECTION 3.07. Reports by the Trustee..........................................................63
SECTION 3.08. Limitation on Consolidated Debt................................................64
SECTION 3.09. Limitation on Debt of Restricted Subsidiaries...................................71
SECTION 3.10. Limitation on Issuances of Guarantees by, and Debt
Securities of, Domestic Restricted Subsidiaries.......................................73
SECTION 3.11. Limitation on Restricted Payments...............................................74
</TABLE>
<PAGE> 3
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 3.12. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries.....................................................79
SECTION 3.13. Limitation on Liens.............................................................81
SECTION 3.14. Limitation on Sale and Leaseback Transactions...................................83
SECTION 3.15. Limitation on Asset Dispositions................................................84
SECTION 3.16. Limitation on Issuances and Sales of Capital Stock of
Restricted Subsidiaries...............................................................85
SECTION 3.17. Limitation on Transactions with Affiliates......................................87
SECTION 3.18. Repurchase of Notes Upon Change of Control Triggering
Event.................................................................................89
SECTION 3.19. Reports.........................................................................91
SECTION 3.20. Limitation on Designations of Unrestricted Subsidiaries.........................92
SECTION 3.21. Existence.......................................................................94
SECTION 3.22. Payment of Taxes and Other Claims...............................................94
SECTION 3.23. Maintenance of Properties and Insurance.........................................94
SECTION 3.24. Waiver of Stay, Extension or Usury Laws.........................................95
ARTICLE 4
REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 4.01. Events of Default...............................................................95
SECTION 4.02. Acceleration....................................................................97
SECTION 4.03. Other Remedies..................................................................97
SECTION 4.04. Waiver of Past Defaults.........................................................98
SECTION 4.05. Control by Majority.............................................................98
SECTION 4.06. Limitation on Suits.............................................................98
SECTION 4.07. Rights of Holders to Receive Payment............................................99
SECTION 4.08. Collection Suit by Trustee......................................................99
SECTION 4.09. Trustee May File Proofs of Claim................................................99
SECTION 4.10. Priorities.....................................................................100
SECTION 4.11. Undertaking for Costs..........................................................100
ARTICLE 5
CONCERNING THE TRUSTEE
SECTION 5.01. Duties and Responsibilities of the Trustee; During Default;
Prior to Default.....................................................................101
SECTION 5.02. Certain Rights of the Trustee..................................................102
SECTION 5.03. Trustee Not Responsible for Recitals, Disposition of Notes
or Application of Proceeds Thereof...................................................103
SECTION 5.04. Trustee and Agents May Hold Notes; Collections, etc............................103
SECTION 5.05. Moneys Held by Trustee.........................................................104
</TABLE>
ii
<PAGE> 4
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 5.06. Notice of Default..............................................................104
SECTION 5.07. Compensation and Indemnification of Trustee and Its
Prior Claim..........................................................................104
SECTION 5.08. Right of Trustee to Rely on Officers' Certificate, etc.........................105
SECTION 5.09. Persons Eligible for Appointment as Trustee....................................105
SECTION 5.10. Resignation and Removal; Appointment of Successor
Trustee..............................................................................105
SECTION 5.11. Acceptance of Appointment by Successor Trustee.................................107
SECTION 5.12. Merger, Conversion, Consolidation or Succession to
Business of Trustee..................................................................108
SECTION 5.13. Preferential Collection of Claims..............................................108
ARTICLE 6
CONCERNING THE HOLDERS
SECTION 6.01. Evidence of Action Taken by Holders............................................109
SECTION 6.02. Proof of Execution of Instruments and of Holding of Notes;
Record Date..........................................................................109
SECTION 6.03. Notes Owned by Company Deemed Not Outstanding..................................109
SECTION 6.04. Right of Revocation of Action Taken............................................110
ARTICLE 7
SUPPLEMENTAL INDENTURES
SECTION 7.01. Supplemental Indentures Without Consent of Holders.............................111
SECTION 7.02. Supplemental Indentures With Consent of Holders................................112
SECTION 7.03. Effect of Supplemental Indenture...............................................114
SECTION 7.04. Documents to Be Given to Trustee; Compliance with TIA..........................114
SECTION 7.05. Notation on Notes in Respect of Supplemental Indentures........................114
ARTICLE 8
CONSOLIDATION, MERGER OR SALE OF ASSETS
SECTION 8.01. Consolidation, Merger or Sale of Assets........................................114
SECTION 8.02. Successor Corporation Substituted..............................................116
SECTION 8.03. Opinion of Counsel to Trustee..................................................116
ARTICLE 9
REDEMPTION OF NOTES
SECTION 9.01. Right of Optional Redemption; Prices...........................................116
SECTION 9.02. Notice of Redemption; Partial Redemptions......................................117
</TABLE>
iii
<PAGE> 5
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
SECTION 9.03. Payment of Notes Called for Redemption.........................................119
SECTION 9.04. Exclusion of Certain Notes from Eligibility for Selection
for Redemption.......................................................................119
ARTICLE 10
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 10.01. Company's Option to Effect Defeasance or Covenant
Defeasance...........................................................................120
SECTION 10.02. Legal Defeasance and Discharge................................................120
SECTION 10.03. Covenant Defeasance...........................................................120
SECTION 10.04. Conditions to Legal or Covenant Defeasance....................................121
SECTION 10.05. Deposited Money and Government Securities to Be Held
in Trust; Other Miscellaneous Provisions.............................................122
SECTION 10.06. Repayment to Company..........................................................123
SECTION 10.07. Reinstatement.................................................................123
ARTICLE 11
MISCELLANEOUS PROVISIONS
SECTION 11.01. Incorporators, Stockholders, Officers, Directors,
Employees and Controlling Persons of Company Exempt from
Individual Liability.................................................................124
SECTION 11.02. Provisions of Indenture for the Sole Benefit of Parties
and Holders..........................................................................124
SECTION 11.03. Successors and Assigns of Company Bound by Indenture..........................124
SECTION 11.04. Notices and Demands on Company, Trustee and Holders...........................125
SECTION 11.05. Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein...................................................125
SECTION 11.06. Payments Due on Saturdays, Sundays and Holidays...............................126
SECTION 11.07. Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939................................................................127
SECTION 11.08. New York Law to Govern........................................................127
SECTION 11.09. Counterparts.................................................................127
SECTION 11.10. Effect of Headings............................................................127
</TABLE>
EXHIBITS
EXHIBIT A Restricted Legend
EXHIBIT B Depositary Legend
EXHIBIT C Rule 144A Certificate
EXHIBIT D Regulation S Certificate
iv
<PAGE> 6
INDENTURE, dated as of August 8, 2000 between Williams Communications
Group, Inc., a Delaware corporation (the "COMPANY"), and The Bank of New York, a
New York banking corporation (the "TRUSTEE"),
WITNESSETH:
WHEREAS, the Company has duly authorized the issuance of $575,000,000
aggregate principal amount of its 11.70% Senior Redeemable Notes Due 2008 (the
"2008 NOTES") and $425,000,000 aggregate principal amount of its 11.875% Senior
Redeemable Notes Due 2010 (the "2010 NOTES") and, to provide, among other
things, for the authentication, delivery and administration thereof, the Company
has duly authorized the execution and delivery of this Indenture; and
WHEREAS, the Notes and the Trustee's certificate of authentication
shall be in substantially the following form:
[FORM OF FACE OF NOTE]
No. $
[CUSIP No.] [as revised by the Schedule of
Exchanges of Notes attached hereto](1)
Williams Communications Group, Inc.
[ ]% Senior Redeemable Note Due 20__
Williams Communications Group, Inc., a Delaware corporation (the
"COMPANY"), for value received hereby promises to pay to [ ] or registered
assigns the principal sum of [ ] Dollars [, as revised by the Schedule of
Exchanges of Notes attached hereto,](2) at the Company's office or agency for
said purpose in The City of New York, on August 1, 20__, in such coin or
currency of the United States of America as at the time of payment shall be
legal tender for the payment of public and private debts, and to pay interest,
semi-annually on February 1 and August 1 (each an "INTEREST PAYMENT DATE") of
each year, commencing with February 1, 2001, on said principal sum in like coin
or currency at the rate per annum set forth above at said office or agency from
the most recent Interest Payment Date to which interest on the Notes has been
paid or duly provided for, unless the date hereof is a date to which interest on
the Notes
----------
(1) Include only for Global Notes.
(2) Include only for Global Notes.
<PAGE> 7
has been paid or duly provided for, in which case from the date of this Note,
or, if no interest on the Notes has been paid or duly provided for, from August
8, 2000. Notwithstanding the foregoing, if the date hereof is after January 15
or July 15 (each a "REGULAR RECORD DATE"), as the case may be, and before the
immediately following Interest Payment Date, this Note shall bear interest from
such Interest Payment Date; provided, that if the Company shall default in the
payment of interest due on such Interest Payment Date then this Note shall bear
interest from the next preceding Interest Payment Date to which interest on the
Notes has been paid or duly provided for. The interest so payable on any
Interest Payment Date will, except as otherwise provided in the Indenture
referred to on the reverse hereof, be paid to the person in whose name this Note
is registered at the close of business on the Regular Record Date preceding such
Interest Payment Date whether or not such day is a business day; provided that
interest may be paid, at the option of the Company, by mailing a check therefor
payable to the registered Holder entitled thereto at such Holder's last address
as it appears on the Note register or by wire transfer, in immediately available
funds, to such bank or other entity in the continental United States as shall be
designated in writing by such Holder prior to the relevant Regular Record Date
and shall have appropriate facilities for such purpose, or in accordance with
the standard operating procedures of the Depositary (as defined in the
Indenture).
[The Holder of this Note is entitled to the benefits of the
Registration Rights Agreement, dated as of August 8, 2000, between the Company
and the Initial Purchasers named therein (the "REGISTRATION RIGHTS AGREEMENT").
In the event that (i) the Exchange Offer Registration Statement (as defined in
the Registration Rights Agreement) relating to the Exchange Offer (as defined in
the Registration Rights Agreement) is not filed with the Securities and Exchange
Commission on or prior to the 90th day after the Closing Date (as defined in the
Registration Rights Agreement), (ii) the Exchange Offer Registration Statement
is not declared effective on or prior to the 180th day after the Closing Date,
or (iii) the Exchange Offer is not consummated or a Shelf Registration Statement
(as defined in the Registration Rights Agreement) is not declared effective on
or prior to the 210th day after the Closing Date (each such event referred to in
clauses (i) through (iii), a "REGISTRATION DEFAULT"), then the interest on this
Note will increase (as liquidated damages) in an amount equal to 0.50% per annum
during the first 90-day period immediately following the occurrence of each such
Registration Default. The interest on this Note will increase by an additional
0.50% per annum for each subsequent 90-day period until such Registration
Default is cured, up to a maximum rate of liquidated damages of 1.50% per
annum.](3)
----------
(3) Include only for Initial Note.
2
<PAGE> 8
Interest, other than interest on overdue amounts, on the Notes will be
computed on the basis of a 360-day year consisting of twelve 30-day months.
Reference is made to the further provisions set forth on the reverse
hereof. Such further provisions shall for all purposes have the same effect as
though fully set forth at this place.
This Note shall not be valid or obligatory until the certificate of
authentication hereon shall have been duly signed by the Trustee acting under
the Indenture.
IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed.
WILLIAMS COMMUNICATIONS GROUP, INC.
By:
--------------------------------------
Name:
Title:
3
<PAGE> 9
[FORM OF TRUSTEE'S CERTIFICATE OF AUTHENTICATION]
Dated:
------------------------
This is one of the Notes described in the within-mentioned Indenture.
THE BANK OF NEW YORK,
as Trustee
By:
--------------------------------------
Authorized Signatory
4
<PAGE> 10
[FORM OF REVERSE OF NOTE]
Williams Communications Group, Inc.
[ ]% Senior Redeemable Note Due 20__
This Note is one of a duly authorized issue of debt securities of the
Company, limited to the aggregate principal amount of $[ ], issued or to be
issued pursuant to an indenture dated as of August 8, 2000 (the "INDENTURE"),
duly executed and delivered by the Company to The Bank of New York, as Trustee
(herein called the "TRUSTEE"). Reference is hereby made to the Indenture and all
indentures supplemental thereto for a description of the rights, limitations of
rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the holders (the words "HOLDERS" or "HOLDER" meaning the registered
holders or registered holder) of the Notes.
This Note will bear interest until final maturity at a rate per annum
shown above. The Company will pay interest on overdue principal of, premium, if
any, and to the extent lawful, interest on overdue installments of interest, at
a [ ]% rate per annum based on a 360-day year consisting of twelve 30-day
months.
In case an Event of Default (as defined in the Indenture) shall have
occurred and be continuing, the principal of all the Notes may be declared due
and payable, in the manner and with the effect, and subject to the conditions,
provided in the Indenture. The Indenture provides that in certain events such
declaration and its consequences may be waived by the Holders of a majority in
aggregate principal amount of the Notes then outstanding and that, prior to any
such declaration, such Holders may waive any past default under the Indenture
and its consequences except a default in the payment of principal of, premium,
if any, or interest on any of the Notes or in respect of a covenant or provision
of the Indenture that cannot be modified or amended without the consent of the
holder of each outstanding Note affected. Any such consent or waiver by the
Holder of this Note (unless revoked as provided in the Indenture) shall be
conclusive and binding upon such Holder and upon all future Holders and owners
of this Note and any Note which may be issued in exchange or substitution
herefor, whether or not any notation thereof is made upon this Note or such
other Notes.
The Indenture permits the Company and the Trustee, with the consent of
the Holders of not less than a majority in principal amount of the Notes at the
time outstanding, evidenced as in the Indenture provided, to enter into one or
more indentures supplemental to the Indenture for the purpose of adding any
provisions to or changing in any manner or eliminating any of the provisions of
the Indenture or modifying in any manner the rights of the Holders; provided
that no such
5
<PAGE> 11
supplemental indenture shall, without the consent of the Holder of each
outstanding Note: (1) change the Stated Maturity of the principal of, or any
installment of interest on, any Note, or reduce the principal amount thereof or
the interest thereon that would be due and payable upon the Stated Maturity
thereof, or change the place of payment where, or the coin or currency in which,
any Note or any premium or interest thereon is payable, or impair the right to
institute suit for the enforcement of any such payment on or after the Stated
Maturity thereof; (2) reduce the percentage in principal amount of the
outstanding Notes, the consent of whose Holders is necessary for any such
supplemental indenture or required for any waiver of compliance with certain
provisions of the Indenture or certain Defaults thereunder; (3) subordinate in
right of payment, or otherwise subordinate, the Notes to any other Debt; (4)
except as otherwise required by the Indenture, release any security interest
that may have been granted in favor of the Holders of the Notes; (5) reduce the
premium payable upon the redemption of any Note nor change the time at which any
Note may be redeemed, as described in the Indenture; (6) reduce the premium
payable upon a Change of Control Triggering Event; (7) make any change in any
Domestic Restricted Subsidiary Guarantee that would adversely affect the Holders
of the Notes; or (8) modify any provision of this paragraph (except to increase
any percentage set forth herein).
Notwithstanding the foregoing, without the consent of any Holder of
Notes, the Company and the Trustee may, at any time and from time to time,
without notice to or consent of any Holders of Notes, enter into one or more
indentures supplemental to the Indenture: (1) to evidence the succession of
another Person to the Company and the assumption by such successor of the
covenants of the Company in the Indenture and the Notes; (2) to add to the
covenants of the Company, for the benefit of the Holders, or to surrender any
right or power conferred upon the Company by the Indenture; (3) to add any
additional Events of Default; (4) to provide for uncertificated Notes in
addition to or in place of certificated Notes; (5) to evidence and provide for
the acceptance of appointment under the Indenture of a successor trustee; (6) to
secure the Notes; (7) to comply with the Trust Indenture Act of 1939; (8) to add
additional Guarantees with respect to the Notes or to release Guarantors from
Domestic Restricted Subsidiary Guarantees as provided by the terms of the
Indenture; or (9) to cure any ambiguity in the Indenture, to correct or
supplement any provision in the Indenture which may be inconsistent with any
other provision therein or to add any other provision with respect to matters or
questions arising under the Indenture; provided such actions shall not adversely
affect the interests of the Holders in any material respect.
No reference herein to the Indenture and no provision of this Note or
of the Indenture shall alter or impair the obligation of the Company, which is
absolute
6
<PAGE> 12
and unconditional, to pay the principal of, premium, if any, and interest on
this Note at the place, times, and rate, and in the currency, herein prescribed.
The Notes are issuable only as registered Notes without coupons in
denominations of $1,000 and any multiple of $1,000.
At the office or agency of the Company referred to on the face hereof
and in the manner and subject to the limitations provided in the Indenture,
Notes may be exchanged for a like aggregate principal amount of Notes of other
authorized denominations.
Upon due presentment for registration of transfer of this Note at the
above-mentioned office or agency of the Company, a new Note or Notes of
authorized denominations, for a like aggregate principal amount, will be issued
to the transferee as provided in the Indenture. No service charge shall be made
for any such transfer, but the Company may require payment of a sum sufficient
to cover any tax or other similar governmental charge that may be imposed in
connection therewith.
[Prior to August 1, 2008, the Company may redeem all or part of the
Notes at any time upon not less than 30 nor more than 60 days' notice at the
Make-Whole Price (as defined in the Indenture), plus accrued and unpaid interest
on the Notes, if any, to the redemption date.
In addition, at any time or from time to time prior to August 1, 2003,
the Company may redeem up to 35% of the original aggregate principal amount of
the Notes at a redemption price equal to 111.70% of the principal amount of the
Notes so redeemed, plus accrued and unpaid interest thereon (if any) to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date), with
the net cash proceeds of one or more private placements to Persons other than
Affiliates of the Company or public offerings of common stock of the Company, in
each case resulting in gross proceeds to the Company of at least $100 million in
the aggregate; provided that
o at least 65% of the original aggregate principal amount of the
Notes would remain outstanding immediately after giving effect to
such redemption;
o any such redemption shall be made within 90 days of such private
placement or public offering upon not less than 30 nor more than
60 days' prior notice; and
7
<PAGE> 13
o any such redemption may not occur in connection with or after the
occurrence of a Change of Control.
Subject to payment by the Company of a sum sufficient to pay the amount
due on redemption, interest on this Note (or portion hereof if this Note is
redeemed in part) shall cease to accrue upon the date duly fixed for redemption
of this Note (or portion hereof if this Note is redeemed in part).](4)
[Prior to August 1, 2005, the Company may redeem all or part of the
Notes at any time upon not less than 30 nor more than 60 days' notice at the
Make- Whole Price (as defined in the Indenture), plus accrued and unpaid
interest on the Notes, if any, to the redemption date. The Notes may be redeemed
at the option of the Company as a whole, or from time to time in part, on any
date on or after August 1, 2005, upon mailing a notice of such redemption not
less than 30 nor more than 60 days prior to the date fixed for redemption to the
Holders of Notes to be redeemed, all as provided in the Indenture, at the
following redemption prices (expressed in percentages of principal amount)
together in each case with accrued and unpaid interest to the date fixed for
redemption (subject to the right of Holders of record on the relevant Regular
Record Date to receive interest on an Interest Payment Date that is on or prior
to the redemption date):
If redeemed during the twelve-month period beginning August 1,
<TABLE>
<CAPTION>
Year Percentage
<S> <C>
2005............................................................ 105.938%
2006............................................................ 103.958%
2007............................................................ 101.979%
2008 and thereafter............................................. 100.000%
</TABLE>
In addition, at any time or from time to time prior to August 1, 2003,
the Company may redeem up to 35% of the original aggregate principal amount of
the Notes at a redemption price equal to 111.875% of the principal amount of the
Notes so redeemed, plus accrued and unpaid interest thereon (if any) to the
redemption date (subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date), with
the net cash proceeds of one or more private placements to Persons other than
Affiliates of the Company or public offerings of common stock of the Company, in
each case resulting in gross proceeds to the Company of at least $100 million in
the aggregate; provided that
----------
(4) To be inserted in 2008 Notes.
8
<PAGE> 14
o at least 65% of the original aggregate principal amount of the
Notes would remain outstanding immediately after giving effect to
such redemption;
o any such redemption shall be made within 90 days of such private
placement or public offering upon not less than 30 nor more than
60 days' prior notice; and
o any such redemption may not occur in connection with or after the
occurrence of a Change of Control.
Subject to payment by the Company of a sum sufficient to pay the amount
due on redemption, interest on this Note (or portion hereof if this Note is
redeemed in part) shall cease to accrue upon the date duly fixed for redemption
of this Note (or portion hereof if this Note is redeemed in part).](5)
Upon the occurrence of a Change of Control Triggering Event (as defined
in the Indenture), any Holder of Notes will have the right to cause the Company
to purchase the Notes of such Holder, in whole or in part in integral multiples
of aggregate principal amount of $1,000, at a purchase price in cash equal to
101% of the principal amount of the Notes on the purchase date plus accrued and
unpaid interest, if any, to such purchase date (subject to the right of Holders
of record on the relevant record date to receive interest due on the relevant
interest payment date), as provided in, and subject to, the terms of the
Indenture.
The Company, the Trustee, and any authorized agent of the Company or
the Trustee, may deem and treat the registered Holder hereof as the absolute
owner of this Note (whether or not this Note shall be overdue and
notwithstanding any notation of ownership or other writing hereon made by anyone
other than the Company or the Trustee or any authorized agent of the Company or
the Trustee), for the purpose of receiving payment of, or on account of, the
principal hereof and premium, if any, and, subject to the provisions on the face
hereof, interest hereon and for all other purposes, and neither the Company nor
the Trustee nor any authorized agent of the Company or the Trustee shall be
affected by any notice to the contrary.
No recourse shall be had for the payment of the principal of, premium,
if any, or the interest on this Note, for any claim based thereon, or otherwise
in respect thereof, and no recourse under or upon any obligation, covenant or
agreement of the Company in the Indenture, or in any of the Notes or because of
the creation of any Debt (as defined in the Indenture) represented thereby,
against
----------
(5) To be inserted in 2010 Notes.
9
<PAGE> 15
any incorporator, shareholder, officer, director, employee or controlling person
of the Company or of any successor Person thereof, either directly or through
the Company or any successor Person, whether by virtue of any constitution,
statute or rule of law or by the enforcement of any assessment or penalty or
otherwise, all such liability being, by the acceptance hereof and as part of the
consideration for the issue hereof, expressly waived and released.
The Indenture is hereby incorporated by the reference and to the extent
of any variance between the provisions hereof and the Indenture, the Indenture
shall control.
This Note shall be deemed to be a contract under the laws of the State
of New York, and for all purposes shall be construed in accordance with the laws
of said State, except as may otherwise be required by mandatory provisions of
law.
10
<PAGE> 16
[FORM OF TRANSFER NOTICE]
FOR VALUE RECEIVED the undersigned registered Holder hereby sell(s),
assign(s) and transfer(s) unto
Insert Taxpayer Identification No.
--------------------------------------------------------------------------------
Please print or typewrite name and address including zip code of assignee
--------------------------------------------------------------------------------
the within Note and all rights thereunder, hereby irrevocably constituting and
appointing ____________________ attorney to transfer said Note on the books of
the Company with full power of substitution in the premises.
Date:
----------- -----------------------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within-mentioned
instrument in every particular, without
alteration or any change whatsoever.
Signature Guarantee:
-----------------------
11
<PAGE> 17
[In connection with any transfer of this Note occurring prior to August
8, 2002, the undersigned confirms that such transfer is made without utilizing
any general solicitation or general advertising and further as follows:
Check One
[ ] (1) This Note is being transferred to a "qualified institutional buyer"
in compliance with Rule 144A under the Securities Act of 1933, as amended and
certification in the form of Exhibit C to the Indenture is being furnished
herewith.
[ ] (2) This Note is being transferred to a Non-U.S. Person in compliance
with the exemption from registration under the Securities Act of 1933, as
amended, provided by Regulation S thereunder, and certification in the form of
Exhibit D to the Indenture is being furnished herewith.
or
[ ] (3) This Note is being transferred other than in accordance with (1) or
(2) above and documents are being furnished which comply with the conditions of
transfer set forth in this Note and the Indenture.
If none of the foregoing boxes is checked, the Trustee is not obligated
to register this Note in the name of any Person other than the Holder hereof
unless and until the conditions to any such transfer of registration set forth
herein and in the Indenture have been satisfied.
Date:
--------------------
-------------------------------
Seller
By
-----------------------------
NOTICE: The signature to this assignment
must correspond with the name as written
upon the face of the within-mentioned
instrument in every particular, without
alteration or any change whatsoever.
Signature Guarantee: ](6)
--------------------------------
----------
(6) To be included on all certificates bearing the Restricted Legend.
12
<PAGE> 18
OPTION OF HOLDER TO ELECT PURCHASE
If you wish to have this Note purchased by the Company pursuant to
Section 3.15 or Section 3.18 of the Indenture, check the Box: [ ]
If you wish to have a portion of this Note purchased by the Company
pursuant to Section 3.15 or Section 3.18 of the Indenture, state the amount (in
principal amount): $_______________.
Date:
---------------
Your Signature:
----------------------------------------------
(Sign exactly as your name appears on
the other side of this Note)
Signature Guarantee:
-------------------------
13
<PAGE> 19
SCHEDULE OF EXCHANGES OF NOTES(7)
The following exchanges of a part of this Global Note for Certificated Notes or
a part of another Global Note have been made:
<TABLE>
<CAPTION>
PRINCIPAL AMOUNT OF
THIS GLOBAL NOTE
AMOUNT OF DECREASE AMOUNT OF INCREASE FOLLOWING SUCH SIGNATURE OF
IN PRINCIPAL AMOUNT IN PRINCIPAL AMOUNT DECREASE (OR AUTHORIZED OFFICER OF
DATE OF EXCHANGE OF THIS GLOBAL NOTE OF THIS GLOBAL NOTE INCREASE) TRUSTEE
---------------- ------------------- ------------------- ------------------ ---------------------
<S> <C> <C> <C> <C>
</TABLE>
----------
(7) For Global Notes.
14
<PAGE> 20
AND WHEREAS, all things necessary to make the Notes, when executed by
the Company and authenticated and delivered by the Trustee as in the Indenture
provided, the valid, binding and legal obligations of the Company, and to
constitute these presents a valid indenture and agreement according to its
terms, have been done;
NOW, THEREFORE:
In consideration of the premises and the purchases of the Notes by the
Holders thereof, the Company and the Trustee mutually covenant and agree for the
equal and proportionate benefit of the respective Holders from time to time of
the Notes as follows:
ARTICLE 1
DEFINITIONS
SECTION 1.01. Certain Terms Defined. The following terms (except as
otherwise expressly provided or unless the context otherwise clearly requires)
for all purposes of this Indenture and of any indenture supplemental hereto
shall have the respective meanings specified in this Section. All other terms
used in this Indenture which are defined in the Trust Indenture Act of 1939 or
the definitions of which in the Securities Act of 1933 are referred to in the
Trust Indenture Act of 1939 (except as herein otherwise expressly provided or
unless the context otherwise clearly requires), shall have the meanings assigned
to such terms in said Trust Indenture Act and in said Securities Act as in force
at the date of this Indenture. All accounting terms used herein and not
expressly defined shall have the meanings given to them in accordance with GAAP
(whether or not such is indicated herein). 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. The terms
defined in this Article include the plural as well as the singular.
"ACCRETED VALUE" of any Debt issued at a price less than the principal
amount at stated maturity, means, as of any date of determination, an amount
equal to the sum of (a) the issue price of such Debt, as determined in
accordance with Section 1273 of the Code or any successor provisions, plus (b)
the aggregate of the portions of the original issue discount (the excess of the
amounts considered as part of the "stated redemption price" of such Debt within
the meaning of Section 1273(a)(2) of the Code or any successor provisions,
whether denominated as principal or interest, over the issue price of such Debt)
that shall until that time have accrued pursuant to Section 1272 of the Code
(without regard to Section
15
<PAGE> 21
1272(a)(7) of the Code) from the date of issue of such Debt to the date of
determination, minus all amounts until that time paid in respect of such Debt,
which amounts are considered as part of the "stated redemption price" of such
Debt within the meaning of Section 1273(a)(2) of the Code or any successor
provisions (whether such amounts paid were denominated principal or interest).
"ACQUIRED DEBT" means, with respect to any specified Person,
o Debt of any other Person existing at the time such Person
merges with or into or consolidates with or becomes a
Subsidiary of such specified Person and
o Debt secured by a Lien encumbering any Property acquired by
such specified Person,
which Debt was not incurred in connection with, or in anticipation of, such
merger, consolidation or acquisition or such Person becoming a Subsidiary of
such specified Person.
"ADDITIONAL INTEREST" means additional interest owed to the Holders
pursuant to the terms of the Notes and the Registration Rights Agreement.
"AFFILIATE" of any Person means any other Person directly or indirectly
controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, "control" when used with
respect to any Person means the power to direct the management and policies of
such Person, directly or indirectly, whether through the ownership of voting
securities, by contract or otherwise; and the terms "controlling" and
"controlled" have meanings correlative to the foregoing. For purposes of the
covenants described in Section 3.15 and Section 3.17 and the definition of
"Telecommunications Assets" only, "Affiliate" shall also mean any beneficial
owner of shares representing 10% or more of the total voting power of the Voting
Stock on a fully diluted basis of the Company or of rights or warrants to
purchase such Voting Stock, whether or not currently exercisable, and any Person
who would be an Affiliate of any such beneficial owner pursuant to the first
sentence hereof.
"AGENT MEMBER" means a member of, or a participant in, the Depositary.
"ASSET DISPOSITION" means any transfer, conveyance, sale, lease,
issuance or other disposition by the Company or any Restricted Subsidiary in one
or more related transactions (including a consolidation or merger or other sale
of any such Restricted Subsidiary with, into or to another Person in a
transaction in which such Restricted Subsidiary ceases to be a Restricted
Subsidiary of the Company, but
16
<PAGE> 22
excluding a disposition by a Restricted Subsidiary to the Company or a
Restricted Subsidiary or by the Company to a Restricted Subsidiary) of:
(1) shares of Capital Stock or other ownership interests of a
Restricted Subsidiary (other than as permitted by clause (5), (6), (7)
or (9) of the covenant described in Section 3.16 and other than any
transaction in which the Company or such Restricted Subsidiary receives
therefor one or more properties with a Fair Market Value equal to the
Fair Market Value of the Capital Stock issued, sold or disposed of by
the Company or the Restricted Subsidiary);
(2) real property;
(3) all or substantially all of the assets of the Company or
any Restricted Subsidiary representing a division or line of business;
or
(4) other Property of the Company or any Restricted Subsidiary
outside of the ordinary course of business, excluding
o any transfer, conveyance, sale, lease or disposition of
Property by the Company or any Restricted Subsidiary for which
the Company or any Restricted Subsidiary receives capacity and
o any transfer, conveyance, sale, lease or other disposition of
equipment that in the good faith judgment of the Company is
obsolete, damaged, worn out or no longer used by or useful to
the Company;
provided, in each case, that the aggregate consideration for such transfer,
conveyance, sale, lease or other disposition is equal to $5 million or more in
any 12-month period.
The following shall not be Asset Dispositions:
(1) Permitted Telecommunications Asset Dispositions that
comply with clause (1) of the first paragraph in Section 3.15;
(2) when used with respect to the Company, any Asset
Disposition permitted pursuant to Article Eight which constitutes a
disposition of all or substantially all of the assets of the Company
and the Restricted Subsidiaries taken as a whole;
17
<PAGE> 23
(3) Receivables sales constituting Debt under Qualified
Receivable Facilities permitted to be Incurred pursuant to Section
3.08;
(4) sales, leases, conveyances, transfers or other
dispositions to the Company or to a Restricted Subsidiary or to any
other Person if, after giving effect to such sale, lease, conveyance,
transfer or other disposition, such other Person becomes a Restricted
Subsidiary; and
(5) any disposition that results in a Permitted Investment
(other than pursuant to clause (f) or (i) of the definition of
"Permitted Investment") or a Restricted Payment permitted by Section
3.11.
"ATTRIBUTABLE VALUE" means, as to any particular lease under which any
Person is at the time liable other than a Capital Lease Obligation, and at any
date as of which the amount owed under such lease is to be determined, the total
net amount of rent required to be paid by such Person under such lease during
the remaining term of such lease, including any period for which such lease has
been extended, as determined in accordance with GAAP, discounted from the last
date of such remaining term to the date of determination at a rate per annum
equal to the discount rate which would be applicable to a Capital Lease
Obligation with like term in accordance with GAAP. The net amount of rent
required to be paid under any such lease for any such period shall be the
aggregate amount of rent payable by the lessee with respect to such period after
excluding amounts required to be paid on account of insurance, taxes,
assessments, utility, operating and labor costs and similar charges. In the case
of any lease which is terminable by the lessee upon the payment of a penalty,
such net amount shall also include the lesser of the amount of such penalty (in
which case no rent shall be considered as required to be paid under such lease
subsequent to the first date upon which it may be so terminated) or the rent
which would otherwise be required to be paid if such lease is not so terminated.
"ATTRIBUTABLE VALUE" means, as to a Capital Lease Obligation, the principal
amount of such Capital Lease Obligation.
"BOARD OF DIRECTORS" means, with respect to any Person, the Board of
Directors (or similar governing body) of such person or any committee of the
Board of Directors (or similar governing body) of such Person authorized, with
respect to any particular matter, to exercise the power of the Board of
Directors (or similar governing body) of such Person.
"BOARD RESOLUTION" means a copy of a resolution, certified by the
Secretary of the Company to have been duly adopted by the Board of Directors and
to be in full force and effect on the date of such certification, and delivered
to the Trustee.
18
<PAGE> 24
"BUSINESS DAY" means any day except a Saturday, Sunday or other day on
which commercial banks in The City of New York are authorized or required by law
to close.
"CAPITAL LEASE OBLIGATION" of any Person means the obligation to pay
rent or other payment amounts under a lease of (or other Debt arrangements
conveying the right to use) Property of such Person which is required to be
classified and accounted for as a capital lease or a liability on the face of a
balance sheet of such Person in accordance with GAAP (a "CAPITAL LEASE"). The
stated maturity of such obligation shall be the date of the last payment of rent
or any other amount due under such lease prior to the first date upon which such
lease may be terminated by the lessee without payment of a penalty. The
principal amount of such obligation shall be the capitalized amount thereof that
would appear on the face of a balance sheet of such Person in accordance with
GAAP.
"CAPITAL STOCK" of any Person means any and all shares, interests,
participations or other equivalents however designated of corporate stock or
other equity participations, including partnership interests, whether general or
limited, of such Person and any rights (other than debt securities convertible
or exchangeable into an equity interest), warrants or options to acquire an
equity interest in such Person.
"CASH EQUIVALENTS" means:
(1) Government Securities maturing, or subject to tender at
the option of the holder thereof, within two years after the date of
acquisition thereof;
(2) time deposits and certificates of deposit of any
commercial bank organized in the United States having capital and
surplus in excess of $500 million or a commercial bank organized under
the law of any other country that is a member of the Organization for
Economic Cooperation and Development having total assets in excess of
$500 million, or its foreign currency equivalent at the time, with a
maturity date not more than one year from the date of acquisition;
(3) repurchase obligations with a term of not more than 30
days for underlying securities of the types described in clause (1)
above entered into with
o any bank meeting the qualifications specified in clause (2)
above, or
19
<PAGE> 25
o any primary government securities dealer reporting to the
Market Reports Division of the Federal Reserve Bank of New
York;
(4) direct obligations issued by any state of the United
States of America or any political subdivision of any such state or any
public instrumentality thereof maturing, or subject to tender at the
option of the holder of such obligation, within one year after the date
of acquisition thereof; provided that, at the time of acquisition, the
long-term debt of such state, political subdivision or public
instrumentality has a rating of A or higher from S&P or A-2 or higher
from Moody's, or, if at any time neither S&P nor Moody's shall be
rating such obligations, then an equivalent rating from another
nationally recognized rating service;
(5) commercial paper issued by the parent corporation of any
commercial bank organized in the United States having capital and
surplus in excess of $500 million or a commercial bank organized under
the laws of any other country that is a member of the Organization for
Economic Cooperation and Development having total assets in excess of
$500 million or its foreign currency equivalent at the time, and money
market instruments and commercial paper issued by others having one of
the three highest ratings obtainable from either S&P or Moody's, or, if
at any time neither S&P nor Moody's shall be rating such obligations,
then from another nationally recognized rating service, and in each
case maturing within one year after the date of acquisition;
(6) overnight bank deposits and bankers' acceptances at any
commercial bank organized in the United States having capital and
surplus in excess of $500 million or a commercial bank organized under
the laws of any other country that is a member of the Organization for
Economic Cooperation and Development having total assets in excess of
$500 million or its foreign currency equivalent at the time;
(7) deposits available for withdrawal on demand with a
commercial bank organized in the United States having capital and
surplus in excess of $500 million or a commercial bank organized under
the laws of any other country that is a member of the Organization for
Economic Cooperation and Development having total assets in excess of
$500 million or its foreign currency equivalent at the time; and
(8) investments in money market funds substantially all of
whose assets comprise securities of the types described in clauses (1)
through (7).
20
<PAGE> 26
"CERTIFICATED NOTE" means a Note issued in the form of a permanent
certificated note in registered form without interest coupons in substantially
the form hereinabove recited.
"CHANGE OF CONTROL" has the meaning set forth in Section 3.18.
"CHANGE OF CONTROL TRIGGERING EVENT" has the meaning set forth in
Section 3.18.
"CLEARSTREAM, LUXEMBOURG" means Clearstream Banking S.A., as
operator of Clearstream, Luxembourg, or its successor in such capacity.
"CODE" means the Internal Revenue Code of 1986, as amended.
"COMMISSION" means the Securities and Exchange Commission.
"COMMON STOCK" of any Person means Capital Stock of such Person that
does not rank prior, as to the payment of dividends or as to the distribution of
assets upon any voluntary or involuntary liquidation, dissolution or winding up
of such Person, to shares of Capital Stock of any other class of such Person.
"CONSOLIDATED CAPITAL RATIO" means as of the date of determination the
ratio of (1) the aggregate amount of Debt of the Company and its Restricted
Subsidiaries on a consolidated basis as at the date of determination to (2) the
sum of:
(a) the Company's capital in excess of par value on October 6,
1999 determined on a consolidated basis in accordance with GAAP;
(b) the aggregate Net Proceeds to the Company from the
issuance or sale of any Capital Stock, including Preferred Stock, of
the Company other than Disqualified Stock subsequent to October 6,
1999; and
(c) the aggregate Net Proceeds from the issuance or sale of
Debt of the Company or any Restricted Subsidiary subsequent to October
6, 1999 convertible or exchangeable into Capital Stock of the Company
other than Disqualified Stock, in each case upon conversion or exchange
thereof into Capital Stock of the Company subsequent to October 6,
1999;
provided, however, that, for purposes of calculation of the Consolidated Capital
Ratio, the Net Proceeds from the issuance or sale of Capital Stock or Debt
described in clause (b) or (c) above shall not be included to the extent
21
<PAGE> 27
o such proceeds have been utilized to make a Permitted Investment
under clause (i) of the definition thereof or a Restricted
Payment, or
o such Capital Stock or Debt shall have been issued or sold to the
Company, a Subsidiary of the Company or a Plan.
"CONSOLIDATED CASH FLOW AVAILABLE FOR FIXED CHARGES" for any period
means the Consolidated Net Income of the Company and its Restricted Subsidiaries
for such period increased by the sum of, to the extent reducing Consolidated Net
Income for such period;
(1) Consolidated Interest Expense of the Company and its
Restricted Subsidiaries for such period; plus
(2) Consolidated Income Tax Expense of the Company and its
Restricted Subsidiaries for such period; plus
(3) consolidated depreciation and amortization expense and any
other non-cash items (other than any such non-cash item to the extent
that it represents an accrual of or reserve for cash expenditures in
any future period) for such period; plus
(4) any penalty paid in such period in connection with
redeeming or retiring any Debt prior to its stated maturity; plus
(5) any change in Deferred Revenue during such period;
provided, however, that there shall be excluded therefrom the Consolidated Cash
Flow Available for Fixed Charges, if positive, of any Restricted Subsidiary
(calculated separately for such Restricted Subsidiary in the same manner as
provided above for the Company) that is subject to a restriction which prevents
the payment of dividends or the making of distributions to the Company or
another Restricted Subsidiary to the extent of such restrictions.
"CONSOLIDATED INCOME TAX EXPENSE" for any period means the aggregate
amounts of the provisions for income taxes of the Company and its Restricted
Subsidiaries for such period calculated on a consolidated basis in accordance
with GAAP.
"CONSOLIDATED INTEREST EXPENSE" for any period means the interest
expense included in a consolidated income statement, excluding interest income,
of the Company and its Restricted Subsidiaries for such period in accordance
with GAAP, including without limitation or duplication (or, to the extent not so
22
<PAGE> 28
included, with the addition of (but in no event adding any amount that would be
eliminated in consolidation in accordance with GAAP)):
(1) the amortization of Debt discounts and issuance costs,
including commitment fees;
(2) any payments or fees with respect to letters of credit,
bankers' acceptances or similar facilities;
(3) net costs with respect to interest rate swap or similar
agreements or foreign currency hedge, exchange or similar agreements,
including fees;
(4) Preferred Stock Dividends other than dividends paid in
shares of Preferred Stock that is not Disqualified Stock declared and
paid or payable;
(5) accrued Disqualified Stock Dividends, whether or not
declared or paid;
(6) interest on Debt guaranteed by the Company and its
Restricted Subsidiaries;
(7) the portion of any Capital Lease Obligation or Sale and
Leaseback Transaction paid during such period that is allocable to
interest expense in accordance with GAAP; and
(8) the cash contributions to any Plan to the extent such
contributions are used by such Plan to pay interest or fees to any
Person, other than the Company or a Restricted Subsidiary, in
connection with Debt Incurred by such Plan.
"CONSOLIDATED NET INCOME" for any period means the net income (or loss)
of the Company and its Restricted Subsidiaries for such period determined on a
consolidated basis in accordance with GAAP; provided that there shall be
excluded from such net income (or loss):
(a) for purposes of Section 3.11 only, the net income (or
loss) of any Person acquired by the Company or a Restricted Subsidiary
in a pooling-of-interests transaction for any period prior to the date
of such transaction;
23
<PAGE> 29
(b) the net income (or loss) of any Person that is not a
Restricted Subsidiary except to the extent of the amount of dividends
or other distributions actually paid to the Company or a Restricted
Subsidiary by such Person during such period (except, for purposes of
Section 3.11 only, to the extent such dividends or distributions have
been subtracted from the calculation of the amount of Investments to
support the actual making of Investments);
(c) gains or losses realized upon the sale or other
disposition of any Property of the Company or its Restricted
Subsidiaries that is not sold or disposed of in the ordinary course of
business (it being understood that Permitted Telecommunications Asset
Dispositions shall be considered to be in the ordinary course of
business);
(d) all extraordinary gains and extraordinary losses,
determined in accordance with GAAP;
(e) the cumulative effect of changes in accounting principles;
(f) non-cash gains or losses resulting from fluctuations in
currency exchange rates;
(g) any non-cash expense related to the issuance to employees
or directors of the Company or any Restricted Subsidiary of (1) options
to purchase Capital Stock of the Company or such Restricted Subsidiary
or (2) other compensatory rights; and
(h) with respect to a Restricted Subsidiary that is not a
Wholly Owned Subsidiary any aggregate net income (or loss) in excess of
the Company's or any Restricted Subsidiary's pro rata share of the net
income (or loss) of such Restricted Subsidiary that is not a Wholly
Owned Subsidiary, but such excess shall be excluded only to the extent
that such minority interest in net income (or loss) is not otherwise
excluded in determining consolidated net income in accordance with
GAAP; provided further that there shall further be excluded therefrom
the net income (but not net loss) of any Restricted Subsidiary that is
subject to a restriction which prevents the payment of dividends or the
making of distributions to the Company or another Restricted Subsidiary
to the extent of such restriction; and provided further, that at the
time any restriction referred to in the immediately preceding proviso
ceases to be effective, all of such net income previously excluded from
Consolidated Net Income by reason of such proviso shall be included
cumulatively in Consolidated Net Income in the accounting period during
which such restriction ceases to be effective.
24
<PAGE> 30
"CONSOLIDATED NET WORTH" of any Person means the stockholders' equity
of such Person, determined on a consolidated basis in accordance with GAAP, less
(to the extent not otherwise accounted for as a liability) amounts attributable
to Disqualified Stock of such Person.
"CONSOLIDATED TANGIBLE ASSETS" of any Person means the total amount of
assets (less applicable reserves and other properly deductible items) which
under GAAP would be included on a consolidated balance sheet of such Person and
its Subsidiaries after deducting from such total amount of assets all goodwill,
trade names, trademarks, patents, unamortized debt discount and expense and
other like intangibles, which in each case under GAAP would be included on such
consolidated balance sheet.
"CORPORATE TRUST OFFICE" means the office of the Trustee at which the
corporate trust business of the Trustee shall, at any particular time, be
principally administered, which office is, at the date as of which this
Indenture is dated, located at 101 Barclay Street, Floor 21 West, New York, New
York 10286.
"CREDIT FACILITIES" means one or more credit agreements, including
without limitation, the Permanent Credit Facility, loan agreements, fiscal
agency agreements (other than fiscal agency agreements relating to Debt
Securities) or similar facilities, secured or unsecured, providing for working
capital advances, revolving credit loans, term loans and/or letters of credit,
including any Qualified Receivable Facility, entered into from time to time by
the Company and its Restricted Subsidiaries, and including any related notes,
Guarantees, collateral documents, instruments and agreements executed with such
credit facilities, as the same may be amended, supplemented, modified, restated
or replaced from time to time.
"DEBT" means (without duplication), with respect to any Person, whether
recourse is to all or a portion of the assets of such Person and whether or not
contingent:
(1) every obligation of such Person for money borrowed;
(2) every obligation of such Person evidenced by bonds,
debentures, notes or other similar instruments, including obligations
incurred in connection with the acquisition of Property;
(3) every reimbursement obligation of such Person with respect
to letters of credit, bankers' acceptances or similar facilities issued
for the
25
<PAGE> 31
account of such Person or for which such Person is otherwise obligated
to make payment;
(4) every obligation of such Person issued or assumed as the
deferred purchase price of Property or services, including securities
repurchase agreements;
(5) every Capital Lease Obligation of such Person;
(6) all obligations to redeem or repurchase Disqualified Stock
issued by such Person and all Attributable Value in respect of Sale and
Leaseback Transactions entered into by such Person;
(7) the liquidation preference of any Preferred Stock, other
than Disqualified Stock, which is covered by the preceding clause (6),
issued by any Restricted Subsidiary of such Person;
(8) every obligation under Interest Rate or Currency
Protection Agreements of such Person; and
(9) every obligation of the type referred to in clauses (1)
through (8) of another Person and all dividends of another Person the
payment of which, in either case, such Person has Guaranteed.
The "amount" or "principal amount" of Debt at any time of determination
as used herein represented by (a) any Debt issued at a price that is less than
the principal amount at maturity thereof, shall be, except as otherwise set
forth here, the Accreted Value of such Debt at such time or (b) in the case of
any Receivables sale constituting Debt, the amount of the unrecovered purchase
price paid (that is, the amount paid for Receivables that has not been actually
recovered from the collection of such Receivables) by the purchaser (other than
the Company or a Restricted Subsidiary that is wholly owned by the Company)
thereof.
The amount of Debt represented by an obligation under an Interest Rate
or Currency Protection Agreement shall be equal to
(x) zero if such obligation has been Incurred pursuant to
clause (10) of paragraph (b) of Section 3.08, or
(y) the notional amount of such obligation if not Incurred
pursuant to such clause.
26
<PAGE> 32
Despite the above,"Debt" does not include trade accounts payable or
accrued liabilities arising in the ordinary course of business.
"DEBT SECURITIES" means any debt securities, including any Guarantee of
such securities, issued by the Company or any Domestic Restricted Subsidiary in
connection with an underwritten public offering or an underwritten private
placement for resale in accordance with Rule 144A and/or Regulation S, in each
case, not rated or rated below Baa3 by Moody's or BBB- by S&P, or an equivalent
below investment grade rating by any successor Rating Agency.
"DEFAULT" means any event, act or condition the occurrence of which is,
or after notice or the passage of time or both would be, an Event of Default.
"DEFERRED REVENUE" means amounts appearing as a liability on the
financial statements of the Company prepared in accordance with generally
accepted accounting principles as deferred revenue, except, in the case of any
increase in deferred revenue, only to the extent of cash received in connection
therewith.
"DEPOSITARY" means the depositary of each Global Note, which is DTC.
"DEPOSITARY LEGEND" means the legend set forth in Exhibit B hereto.
"DISQUALIFIED STOCK" of any Person means any Capital Stock of such
Person which, 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 final Stated Maturity of the Notes; provided, however,
that any Preferred Stock which would not constitute Disqualified Stock but for
provisions of such Preferred Stock giving holders thereof the right to require
the Company to repurchase or redeem such Preferred Stock upon the occurrence of
a change of control or asset disposition occurring prior to the final Stated
Maturity of the Notes shall not constitute Disqualified Stock if the change of
control or asset disposition provisions applicable to such Preferred Stock are
no more favorable to the holders of such Preferred Stock than the provisions
applicable to the Notes contained in Section 3.15 and Section 3.18 and such
Preferred Stock specifically provides that the Company will not repurchase or
redeem any such stock pursuant to such provisions prior to the Company's
repurchase of such Notes as are required to be repurchased pursuant to Section
3.15 and Section 3.18; and provided further, that such Preferred Stock will not
be deemed Disqualified Stock if it is redeemable by exchange for or through the
issuance of Capital Stock (other than Disqualified Stock).
27
<PAGE> 33
"DISQUALIFIED STOCK DIVIDENDS" means all dividends with respect to
Disqualified Stock of the Company held by Persons other than a Restricted
Subsidiary that is wholly owned by the Company. The amount of any such dividend
shall be equal to the quotient of such dividend divided by the difference
between one and the maximum statutory federal income tax rate (expressed as a
decimal number between 1 and 0) applicable to the Company for the period during
which such dividends were paid.
"DISTRIBUTION COMPLIANCE PERIOD" means the period beginning on the date
hereof and ending 40 days thereafter.
"DOMESTIC RESTRICTED SUBSIDIARY" means any Restricted Subsidiary of
the Company
o that was formed under the laws of the United States of America or
any state, district or territory thereof or the District of
Columbia, or
o 50% or more of the assets of which are located in the United
States or any territory thereof.
"DOMESTIC RESTRICTED SUBSIDIARY GUARANTEE" means a supplemental
indenture to the Indenture in form satisfactory to the Trustee, providing for an
unconditional Guarantee by a Domestic Restricted Subsidiary of payment in full
of the principal of, premium, if any, and interest on the Notes. Any such
Domestic Restricted Subsidiary Guarantee shall not be subordinate to any Debt of
the Domestic Restricted Subsidiary providing the Domestic Restricted Subsidiary
Guarantee.
"DTC" means The Depository Trust Company, its nominees, and their
respective successors.
"ELIGIBLE RECEIVABLES" means, at any time, Receivables of the Company
and its Restricted Subsidiaries, as evidenced on the most recent quarterly
consolidated balance sheet of the Company as at a date at least 45 days prior to
such time, arising in the ordinary course of business of the Company or any
Restricted Subsidiary.
"EUROCLEAR" means Morgan Guaranty Trust Company of New York, Brussels
office, as operator of the Euroclear System, or its successor in such capacity.
28
<PAGE> 34
"EVENT OF DEFAULT" means any event or condition specified as such in
Section 4.01 which shall have continued for the period of time, if any, therein
designated.
"EXCESS PROCEEDS" has the meaning set forth in Section 3.15.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended
(or any successor act), and the rules and regulations thereunder (or respective
successors thereto).
"EXCHANGE NOTES" means the Notes of the Company issued pursuant to this
Indenture in exchange for, and in an aggregate principal amount equal to, the
Initial Notes, in compliance with the terms of the Registration Rights Agreement
and containing terms substantially identical to the Initial Notes (except that
(i) such Exchange Notes will be registered under the Securities Act and will not
be subject to transfer restrictions or bear the Restricted Legend, and (ii) the
provisions relating to Additional Interest will be eliminated) and which shall
vote together as one series with the series of Initial Notes for which they were
issued in exchange.
"EXCHANGE OFFER" means an offer by the Company to the Holders of the
Initial Notes to exchange outstanding Notes for Exchange Notes, as provided for
in the Registration Rights Agreement.
"EXISTING INTERNATIONAL JOINT VENTURES" means ATL-Algar Telecom
Leste S.A., PowerTel Limited, Telefonica Manquehue, S.A. and Algar Telecom
S.A.
"FAIR MARKET VALUE" means, with respect to any Property, the price that
could be negotiated in an arm's-length free market transaction, for cash,
between a willing seller and a willing buyer, neither of whom is under pressure
or compulsion to complete the transaction. Unless otherwise specified in the
Indenture, and except in the case of Permitted Telecommunications Asset
Dispositions in the ordinary course of business, Fair Market Value shall be
determined by the Board of Directors of the Company acting in good faith and
shall be evidenced by a resolution of the Board of Directors of the Company.
"GAAP" means generally accepted accounting principles in the United
States of America as in effect on the date of the Indenture, including, without
limitation, those set forth in the opinions and pronouncements of the Accounting
Principles Board of the American Institute of Certified Public Accountants and
statements and pronouncements of the Financial Accounting Standards Board or in
such other statements by such other entity as approved by a significant segment
of the accounting profession.
29
<PAGE> 35
"GLOBAL NOTE" means a Note in registered global form without interest
coupons.
"GOVERNMENT SECURITIES" means direct obligations of, or obligations
fully and unconditionally guaranteed or insured by, the United States of America
or any agency or instrumentality thereof for the payment of which obligations or
guarantee the full faith and credit of the United States is pledged and which
are not callable or redeemable at the issuer's option (unless, for purposes of
the definition of "Cash Equivalents" only, the obligations are redeemable or
callable at a price not less than the purchase price paid by the Company or the
applicable Restricted Subsidiary, together with all accrued and unpaid interest,
if any, on such Government Securities).
"GUARANTEE" by any Person means any obligation, direct or indirect,
contingent or otherwise, of such Person guaranteeing, or having the economic
effect of guaranteeing, any Debt of any other Person in any manner, whether
directly or indirectly.
"GUARANTOR" means a Domestic Restricted Subsidiary of the Company that
has executed a Domestic Restricted Subsidiary Guarantee.
"HOLDERS", "HOLDER OF NOTES", "NOTEHOLDER" or other similar terms means
a person in whose name a Note is registered.
"INCUR" means, with respect to any Debt or other obligation of any
Person, to create, issue, incur (by conversion, exchange or otherwise), assume,
Guarantee or otherwise become liable in respect of such Debt or other obligation
including the recording, as required pursuant to GAAP or otherwise, of any such
Debt or other obligation on the balance sheet of such Person (and "Incurrence,"
"Incurred," "Incurrable" and "Incurring" shall have meanings correlative to the
foregoing); provided, however, that
o a change in GAAP that results in an obligation of such Person that
exists at such time becoming Debt shall not be deemed an
Incurrence of such Debt and
o neither the accrual of interest nor the amortization or accretion
of original issue discount shall be deemed an Incurrence of Debt.
Debt otherwise incurred by a Person before it becomes a Subsidiary of
the Company shall be deemed to have been Incurred at the time at which it
becomes a Restricted Subsidiary.
30
<PAGE> 36
"INDENTURE" means this instrument as originally executed and delivered
or, if amended or supplemented as herein provided, as so amended or
supplemented.
"INITIAL NOTES" means the Notes issued on the date of this Indenture
and any Notes issued in replacement thereof, but not including any Exchange
Notes issued in exchange therefor.
"INITIAL PURCHASERS" means the initial purchasers party to a purchase
agreement with the Company relating to the sale of the Notes by the Company.
"INTEREST PAYMENT DATE" means each semiannual interest payment date on
February 1 and August 1 of each year, commencing February 1, 2001.
"INTEREST RATE OR CURRENCY PROTECTION AGREEMENT" of any Person means
any forward contract, futures contract, swap, option or other financial
agreement or arrangement (including, without limitation, caps, floors, collars
and similar agreements) relating to, or the value of which is dependent upon,
interest rates or currency exchange rates or indices.
"INVESTED CAPITAL" means the sum of:
(a) $625 million;
(b) the aggregate Net Proceeds received by the Company from
any Capital Stock, including Preferred Stock, of the Company, but
excluding Disqualified Stock, issued or sold pursuant to the
Over-allotment Option or subsequent to October 6, 1999; and
(c) the aggregate Net Proceeds from the issuance or sale of
Debt of the Company or any Restricted Subsidiary subsequent to October
6, 1999, convertible or exchangeable into Capital Stock of the Company
other than Disqualified Stock, in each case, upon conversion or
exchange thereof into Capital Stock of the Company subsequent to
October 6, 1999;
provided, however, that the Net Proceeds from the issuance or sale of Capital
Stock or Debt described in clause (b) or (c) shall be excluded from any
computation of Invested Capital to the extent (1) utilized to make a Restricted
Payment or (2) such Capital Stock or Debt shall have been issued or sold to the
Company, a Subsidiary of the Company or a Plan.
"INVESTMENT" by any Person means any direct or indirect loan, advance
or other extension of credit or capital contribution (by means of transfers of
cash or other Property to others or payments for Property or services for the
account or
31
<PAGE> 37
use of others, or otherwise) to, purchase, redemption, retirement or acquisition
of Capital Stock, bonds, notes, debentures or other securities or evidence of
Debt issued by, or Incurrence of, or payment on, a Guarantee of any obligation
of, any other Person; provided that Investments shall exclude
o commercially reasonable extensions of trade credit,
o trade receivables arising in the ordinary course of business;
provided that such receivables would be recorded as assets of such
Person in accordance with GAAP,
o Investments received in connection with the bankruptcy or
reorganization of suppliers and customers or in good faith bona
fide settlement of delinquent ordinary course of business trade
receivables of customers,
o endorsements for collection or deposit in the ordinary course of
business by such Person of bank drafts and similar negotiable
instruments of such other Person received as payment for ordinary
course of business trade receivables, and
o any Investment that is less than $100,000.
The amount, as of any date of determination, of any Investment shall be
the original cost of such Investment, plus the cost of all additions, as of such
date, thereto and minus the amount, as of such date, of any portion of such
Investment repaid to such Person in cash as a repayment of principal or a return
of capital, as the case may be (except to the extent such repaid amount has been
included in Consolidated Net Income to support the actual making of Restricted
Payments), but without any other adjustments for increases or decreases in
value, or write-ups, write-downs or write-offs with respect to such Investment.
In determining the amount of any Investment involving a transfer of any Property
other than cash, such Property shall be valued at its Fair Market Value at the
time of such transfer.
"JOINT VENTURE" means a Person in which the Company or a Restricted
Subsidiary holds, directly or indirectly, not more than 50% of the shares of
Voting Stock.
"LIEN" means, with respect to any Property, any mortgage or deed of
trust, pledge, hypothecation, assignment, deposit arrangement, security
interest, lien, charge, easement (other than any easement not materially
impairing usefulness), encumbrance, preference, priority or other security
agreement or preferential arrangement of any kind or nature whatsoever on or
with respect to such Property
32
<PAGE> 38
(including any Capital Lease Obligation, conditional sale or other title
retention agreement having substantially the same economic effect as any of the
foregoing and any Sale and Leaseback Transaction). For purposes of this
definition, the sale, lease, conveyance or other transfer by the Company or any
of its Subsidiaries of, including the grant of indefeasible rights of use or
equivalent arrangements with respect to, dark or lit communications fiber
capacity or communications conduit shall not constitute a Lien.
"MAKE-WHOLE AMOUNT" means:
o with respect to any 2008 Note, an amount equal to the excess, if
any, of:
(1) the present value of the remaining principal, premium and
interest payments that would be payable with respect to such 2008 Note
if such 2008 Note were redeemed on August 1, 2008, computed using a
discount rate equal to the Treasury Rate plus 50 basis points; over
(2) the outstanding principal amount of such 2008 Note.
o with respect to any 2010 Note, an amount equal to the excess, if
any, of:
(1) the present value of the remaining principal, premium and
interest payments that would be payable with respect to such 2010 Note
if such 2010 Note were redeemed on August 1, 2005, computed using a
discount rate equal to the Treasury Rate plus 50 basis points; over
(2) the outstanding principal amount of such 2010 Note.
"MAKE-WHOLE AVERAGE LIFE" means, with respect to any date of redemption
of Notes, the number of years (calculated to the nearest one-twelfth) from such
redemption date to
o August 1, 2008 with respect to the 2008 Notes; and
o August 1, 2010 with respect to the 2010 Notes.
"MAKE-WHOLE PRICE" means
o with respect to any 2008 Note, the sum of the principal amount of
such 2008 Note and the Make-Whole Amount; and
33
<PAGE> 39
o with respect to any 2010 Note, the greater of (1) the sum of the
principal amount of such 2010 Note and the Make-Whole Amount with
respect to such 2010 Note and (2) the redemption price of such
2010 Note on August 1, 2005.
"MOODY'S" means Moody's Investors Service, Inc. or, if Moody's
Investors Service, Inc. shall cease rating debt securities having a maturity at
original issuance of at least one year and such ratings business shall have been
transferred to a successor Person, such successor Person; provided, however,
that if there is no successor Person, then "Moody's" shall mean any other
national recognized rating agency, other than S&P, that rates debt securities
having a maturity at original issuance of at least one year and that shall have
been designated by the Company.
"NET AVAILABLE PROCEEDS" from any Asset Disposition by any Person means
cash or cash equivalents received (including amounts received by way of sale or
discounting of any note, installment receivable or other receivable, but
excluding any other consideration received in the form of assumption by the
acquiror of Debt or other obligations relating to such Property) therefrom by
such Person, net of:
(1) all legal, title and recording taxes, expenses and
commissions and other fees and expenses (including appraisals,
brokerage commissions and investment banking fees) Incurred and all
federal, state, provincial, foreign and local taxes required to be
accrued as a liability as a consequence of such Asset Disposition;
(2) all payments made by such Person or its Subsidiaries on
any Debt which is secured by such Property in accordance with the terms
of any Lien upon or with respect to such Property or which must by the
terms of such Lien, or in order to obtain a necessary consent to such
Asset Disposition or by applicable law, be repaid out of the proceeds
from such Asset Disposition;
(3) all distributions and other payments required to be made
to minority interest holders in Subsidiaries or Joint Ventures of such
Person as a result of such Asset Disposition; and
(4) appropriate amounts to be provided by such Person or any
Subsidiary of such Person, as the case may be, as a reserve in
accordance with GAAP against any liabilities associated with such
Property and retained by such Person or any Subsidiary of such Person,
as the case may be, after such Asset Disposition, including liabilities
under any
34
<PAGE> 40
indemnification obligations and severance and other employee
termination costs associated with such Asset Disposition, in each case,
as determined by the Board of Directors of such Person, in its
reasonable good faith judgment evidenced by a resolution of the Board
of Directors filed with the Trustee; provided, however, that any
reduction in such reserve within twelve months following the
consummation of such Asset Disposition will be, for all purposes of the
Indenture and the Notes, treated as a new Asset Disposition at the time
of such reduction with Net Available Proceeds equal to the amount of
such reduction; provided further, however, that, if any consideration
for a transaction, which would otherwise constitute Net Available
Proceeds, is required to be held in escrow pending determination of
whether a purchase price adjustment will be made, at such time as such
portion of the consideration is released to such Person or its
Restricted Subsidiary from escrow, such portion shall be treated for
all purposes of the Indenture and the Notes as a new Asset Disposition
at the time of, but not before, such release from escrow with Net
Available Proceeds equal to the amount of such portion of consideration
released from escrow.
"NET PROCEEDS" means the aggregate net proceeds (including the Fair
Market Value of non-cash proceeds constituting Capital Stock in or of a person
engaged in a Telecommunications Business or assets of a type generally used in a
Telecommunications Business) received by a Person from the sale of Capital Stock
or Debt after payment of out-of-pocket expenses, commissions and discounts
incurred and net of taxes paid or payable in connection with the sale of such
Capital Stock or Debt.
"1999 INDENTURE" means the Indenture dated as of October 6, 1999
between the Company and the Trustee relating to 10.70% Senior Redeemable Notes
due 2007 and 10.875% Senior Redeemable Notes due 2009 of the Company.
"NOTE" or "NOTES" means any 2008 Note or Notes, or 2010 Note or Notes,
as the case may be, authenticated and delivered under this Indenture, including,
for all purposes of this Indenture (unless the context specifically requires
otherwise), Initial Notes and Exchange Notes.
"OBLIGATIONS" means any principal, interest, penalties, fees,
indemnifications, reimbursements, damages and other liabilities payable under
the documentation governing any Debt.
"OFFER TO PURCHASE" means a written offer sent by the Company by
first-class mail, postage prepaid, to each Holder of 2008 Notes or 2010 Notes,
as the case may be, at its address appearing in the Note Register on the date of
the
35
<PAGE> 41
offer offering to purchase up to the principal amount of such Notes specified in
such offer at the purchase price specified in such offer (as determined pursuant
to the Indenture). Unless otherwise required by applicable law, the offer shall
specify an expiration date of the Offer to Purchase which shall be, subject to
any contrary requirements of applicable law, not less than 30 days or more than
60 days after the date of such offer and a settlement date (the "PURCHASE DATE")
for purchase of such Notes within five business days after the expiration date.
The Company shall notify the Trustee at least 15 business days (or such shorter
period as is acceptable to the Trustee) prior to the mailing of the offer of the
Company's obligation to make an Offer to Purchase, and the offer shall be mailed
by the Company or, at the Company's request, by the Trustee in the name and at
the expense of the Company. The offer shall contain information concerning the
business of the Company and its Subsidiaries which the Company in good faith
believes will enable such Holders to make an informed decision with respect to
the Offer to Purchase (which at a minimum will include) any information required
by applicable law to be included therein).
The offer shall contain all instructions and materials necessary to
enable such Holders to tender Notes pursuant to the Offer to Purchase. The offer
shall also state (to the extent not inconsistent with then applicable laws,
rules or regulations):
(a) the section of the Indenture pursuant to which the Offer
to Purchase is being made;
(b) the expiration date and the Purchase Date;
(c) the aggregate principal amount of the outstanding 2008
Notes or 2010 Notes, as the case may be, offered to be purchased by the
Company pursuant to the Offer to Purchase (including, if less than
100%, the manner by which such has been determined pursuant to the
section of the Indenture requiring the Offer to Purchase) (the
"PURCHASE AMOUNT");
(d) the purchase price to be paid by the Company for $1,000
aggregate principal amount of such Notes accepted for payment (as
specified pursuant to the Indenture) (the "PURCHASE PRICE");
(e) that the Holder may tender all or any portion of the
applicable Notes registered in the name of such Holder and that any
portion of a Note tendered must be tendered in an integral multiple of
$1,000 principal amount;
36
<PAGE> 42
(f) the place or places where such Notes are to be surrendered
for tender pursuant to the Offer to Purchase;
(g) that any such Notes not tendered or tendered but not
purchased by the Company will continue to accrue interest;
(h) that on the Purchase Date the Purchase Price will become
due and payable upon each Note being accepted for payment pursuant to
the Offer to Purchase and that interest thereon, if any, shall cease to
accrue on and after the Purchase Date;
(i) that each Holder electing to tender a Note pursuant to the
Offer to Purchase will be required to surrender such Note at the place
or places specified in the offer prior to the close of business on the
expiration date (such Note being, if the Company or the Trustee so
requires, duly endorsed by, or accompanied by a written instrument of
transfer in form satisfactory to the Company and the Trustee duly
executed by, the Holder thereof or his attorney duly authorized in
writing);
(j) that Holders will be entitled to withdraw all or any
portion of Notes tendered if the Company (or the paying agent)
receives, not later than the close of business on the expiration date,
a facsimile transmission or letter setting forth the name of the
Holder, the principal amount of the Note the Holder tendered, the
certificate number of the Note the Holder tendered and a statement that
such Holder is withdrawing all or a portion of his tender;
(k) that (1) if 2008 Notes or 2010 Notes in an aggregate
principal amount less than or equal to the Purchase Amount with respect
to such Notes are duly tendered and not withdrawn pursuant to the Offer
to Purchase, the Company shall purchase all such Notes and (2) if 2008
Notes or 2010 Notes in an aggregate principal amount in excess of the
Purchase Amount with respect to such Notes are tendered and not
withdrawn pursuant to the Offer to Purchase, the Company shall purchase
Notes having an aggregate principal amount equal to the Purchase Amount
on a pro rata basis with respect to each of the 2008 Notes and 2010
Notes, as applicable, (with such adjustments as may be deemed
appropriate so that only Notes in denominations of $1,000 or integral
multiples thereof shall be purchased); and
(l) that in the case of any Holder whose Note is purchased
only in part, the Company shall execute, and the Trustee shall
authenticate and deliver to the Holder of such Note without service
charge, a new Note or
37
<PAGE> 43
Notes, of any authorized denomination as requested by such Holder, in
an aggregate principal amount equal to and in exchange for the
unpurchased portion of the Note so tendered.
Any Offer to Purchase shall be governed by and effected in accordance
with the offer for such Offer to Purchase.
"OFFICER" means, with respect to the Company, (1) the Chairman of the
Board of Directors, the President, any Vice President, the Chief Financial
Officer, and (2) the Treasurer or any Assistant Treasurer, or the Secretary or
any Assistant Secretary.
"OFFICERS' CERTIFICATE" means a certificate signed by the Chairman of
the Board of Directors or the President or any Vice President (whether or not
designated by a number or numbers or a word or words added before or after the
title "Vice President") and delivered to the Trustee. Each such certificate
shall comply with Section 314 of the Trust Indenture Act of 1939 and include the
statements provided for in Section 11.05.
"OPINION OF COUNSEL" means an opinion in writing signed by legal
counsel who may be an employee of or counsel to the Company or who may be other
counsel satisfactory to the Trustee. Each such opinion shall comply with Section
314 of the Trust Indenture Act of 1939 and include the statements provided for
in Section 11.05, and such others as may reasonably be requested by the Trustee,
if and to the extent required hereby.
"OUTSTANDING", when used with reference to Notes, subject to the
provisions of Article Twelve, means, as of any particular time, all Notes
authenticated and delivered by the Trustee under this Indenture, except
(a) Notes theretofore canceled by the Trustee or delivered to
the Trustee for cancellation;
(b) Notes, or portions thereof, for the payment or redemption
of which moneys in the necessary amount shall have been deposited in
trust with the Trustee or with any paying agent (other than the
Company) or shall have been set aside, segregated and held in trust by
the Company (if the Company shall act as its own paying agent),
provided that if such Notes are to be redeemed prior to the maturity
thereof, notice of such redemption shall have been given as herein
provided, or provision satisfactory to the Trustee shall have been made
for giving such notice; and
38
<PAGE> 44
(c) Notes in substitution for which other Notes shall have
been authenticated and delivered, or which shall have been paid,
pursuant to the terms of Section 2.08 (unless proof satisfactory to the
Trustee and the Company is presented that any of such Notes is held by
a person in whose hands such Note is a legal, valid and binding
obligation of the Company).
"OVER-ALLOTMENT OPTION" means the over-allotment option granted to the
underwriters of the equity offering consummated on October 6, 1999.
"PAYING AGENT" has the meaning set forth in Section 3.02.
"PERMANENT CREDIT FACILITY" means the senior credit facility entered
into by and among Williams Communications, Inc., the Company, as Guarantor
thereunder, Bank of America, N.A. (NationsBank, N.A. d/b/a Bank of America,
N.A.), as Administrative Agent, The Chase Manhattan Bank, as Syndication Agent,
Bank of Montreal and The Bank of New York, as Co-Documentation Agents, and the
Lenders from time to time party thereto, including any related notes,
Guarantees, collateral documents, instruments, agreements and Incremental
Facilities (as defined therein) executed at any time in connection therewith, in
each case as may be amended, supplemented, modified, restated or replaced from
time to time (including amendments, supplements, modifications, restatements,
replacements or Incremental Facilities which increase the principal amount of
Debt permitted thereunder; provided that any such increase will not increase the
amount of Debt which may be incurred at the time of such increase pursuant to
clause (2) of paragraph (b) in Section 3.08).
"PERMITTED HOLDERS" means
o The Williams Companies, Inc. and any of its Subsidiaries,
o any corporation the outstanding voting power of the Capital Stock
of which is beneficially owned, directly or indirectly, by the
stockholders of the Company in substantially the same proportions
as their ownership of the voting power of the Capital Stock of the
Company,
o any underwriter during the period engaged in a firm commitment
underwriting on behalf of the Company with respect to the shares
of Capital Stock being underwritten, or
o the Company or any Subsidiary of the Company.
"PERMITTED INTEREST RATE OR CURRENCY PROTECTION AGREEMENT" of any
Person means any Interest Rate or Currency Protection Agreement entered into
39
<PAGE> 45
with one or more financial institutions in the ordinary course of business that
is designed to protect such Person against fluctuations in interest rates or
currency exchange rates with respect to Debt Incurred and not for purposes of
speculation and which, in the case of an interest rate agreement, shall have a
notional amount no greater than the principal amount at maturity due with
respect to the Debt being hedged thereby.
"PERMITTED INVESTMENTS" means:
(a) Cash Equivalents;
(b) investments in prepaid expenses;
(c) negotiable instruments held for collection and lease,
utility and workers' compensation, performance and other similar
deposits;
(d) loans, advances or extensions of credit to employees,
officers and directors of the Company or any Restricted Subsidiary made
in the ordinary course of business and consistent with past practice or
in connection with employee benefits agreements or arrangements
approved by the Board of Directors of the Company;
(e) obligations under Permitted Interest Rate or Currency
Protection Agreements;
(f) Investments received as consideration for, or customary
indemnities given in connection with, Asset Dispositions pursuant to
and in compliance with Section 3.15 and for Permitted Telecommunication
Asset Dispositions;
(g) Investments in the Company or any Restricted Subsidiary,
or in any Person as a result of which such Person becomes a Restricted
Subsidiary;
(h) Investments made prior to the date of the Indenture;
(i) Investments made after the date of the Indenture in
Persons engaged in the Telecommunications Business in an aggregate
amount as of the date of determination not to exceed Invested Capital
as of the date of determination;
(j) Investments deemed to have been made as a result of the
acquisition of a Person that at the time of such acquisition held
instruments
40
<PAGE> 46
constituting Investments that were not acquired in contemplation of the
acquisition of such Person;
(k) Investments received in connection with the bankruptcy or
reorganization of suppliers and customers or in good faith bona fide
settlement of delinquent ordinary course of business trade receivables
of customers;
(l) Investments where all or a portion of the consideration
provided is Capital Stock of the Company, other than Disqualified
Stock, but the same shall constitute a Permitted Investment only to the
extent of such consideration provided in the form of such Capital
Stock;
(m) Investments in Existing International Joint Ventures;
provided that the aggregate amount of such Investments made after the
date of the Indenture does not exceed $100 million as of the date of
determination; and
(n) additional Investments in an aggregate amount not to
exceed $200 million.
"PERMITTED LIENS" means:
(a) Liens for taxes, assessments, governmental charges, levies
or claims which are not yet delinquent or which are being contested in
good faith by appropriate proceedings, if a reserve or other
appropriate provision, if any, as shall be required in conformity with
GAAP shall have been made for such Liens;
(b) other Liens incidental to the conduct of the Company's and
its Restricted Subsidiaries' businesses or the ownership of Property
not securing any Debt, and which do not in the aggregate materially
detract from the value of the Company's and its Restricted
Subsidiaries' Property when taken as a whole, or materially impair the
use thereof in the operation of its business;
(c) Liens, pledges and deposits made in the ordinary course of
business in connection with workers' compensation, unemployment
insurance and other types of statutory obligations;
(d) Liens, pledges or deposits made to secure the performance
of tenders, bids, leases, public or statutory obligations, sureties,
stays, appeals, indemnities, performance or other similar bonds and
other
41
<PAGE> 47
obligations of like nature incurred in the ordinary course of business,
exclusive of obligations for the payment of borrowed money, the
obtaining of advances or credit or the payment of the deferred purchase
price of Property and which do not in the aggregate materially impair
the use of Property in the operation of the business of the Company and
the Restricted Subsidiaries taken as a whole;
(e) zoning restrictions, servitudes, easements, rights of way,
restrictions and other similar charges or encumbrances incurred in the
ordinary course of business which, in the aggregate, do not materially
detract from the value of the Property subject thereto or materially
interfere with the ordinary conduct of the business of the Company or
its Restricted Subsidiaries;
(f) any interest or title of a lessor in the Property subject
to any lease other than a Capital Lease;
(g) Liens with respect to assets of a Restricted Subsidiary
granted by such Restricted Subsidiary to the Company to secure Debt
owing to the Company;
(h) Liens arising out of judgments or awards against the
Company or any Restricted Subsidiary of the Company with respect to
which the Company or such Restricted Subsidiary is prosecuting an
appeal or proceeding for review and the Company or such Restricted
Subsidiary is maintaining adequate reserves in accordance with GAAP;
(i) Liens arising by operation of law in connection with
judgments, only to the extent, for an amount and for a period not
resulting in an Event of Default with respect thereto;
(j) Liens securing Permitted Interest Rate or Currency
Protection Agreement; and
(k) Liens in favor of the Trustee arising under the Indenture
or the 1999 Indenture.
"PERMITTED TELECOMMUNICATIONS ASSET DISPOSITION" means the transfer,
conveyance, sale, lease or other disposition of an interest in or capacity on
optical fiber and/or conduit and any related equipment used in a Segment of the
Company's communications network, whether or not in the ordinary course of
business; provided that, after giving effect to such disposition, the Company
would retain at least
42
<PAGE> 48
(1) with respect to any Segment constructed by, for or on
behalf of the Company or any of its Subsidiaries or Affiliates,
o 24 optical fibers per route mile on such Segment as
deployed at the time of such disposition, or
o 12 optical fibers and one empty conduit per route
mile on such Segment as deployed at such time; and
(2) with respect to any Segment purchased or leased from third
parties, the lesser of
o 50% of the optical fibers per route mile originally
purchased on such Segment,
o 24 optical fibers per route mile on such Segment as
deployed at the time of such disposition, or
o 12 optical fibers and one empty conduit per route
mile on such Segment as deployed at the time of such
disposition.
"PERSON" means any individual, corporation, company, partnership, joint
venture, limited liability company, association, joint stock company, trust,
unincorporated organization, government or agency or political subdivision
thereof or any other entity.
"PLAN" means any employee benefit plan, retirement plan, deferred
compensation plan, restricted stock plan, health, life, disability or other
insurance plan or program, employee stock purchase plan, employee stock
ownership plan, pension plan, stock option plan or similar plan or arrangement
of the Company or any Restricted Subsidiary of the Company, or any successor
plan thereof; and "Plans" shall have a correlative meaning.
"PREFERRED STOCK" of any Person means Capital Stock of such Person of
any class or classes, however designated, that ranks prior, as to the payment of
dividends or as to the distribution of assets upon any voluntary or involuntary
liquidation, dissolution or winding-up of such Person, to shares of Capital
Stock of any other class of such Person.
"PREFERRED STOCK DIVIDENDS" means all dividends with respect to
Preferred Stock of Restricted Subsidiaries held by Persons other than the
Company or one or more Restricted Subsidiaries that are wholly owned by the
Company. The amount of any such dividend shall be equal to the quotient of such
dividend
43
<PAGE> 49
divided by the difference between one and the maximum statutory federal income
rate (expressed as a decimal number between 1 and 0 and determined in accordance
with GAAP) applicable to the issuer of such Preferred Stock for the period
during which such dividends were paid.
"PRINCIPAL" wherever used with reference to the Notes or any Note or
any portion thereof, shall be deemed to include "and premium, if any".
"PROPERTY" means, with respect to any Person, any interest of such
Person in any kind of property or asset, whether real, personal or mixed, or
tangible or intangible, including Capital Stock in, and other securities of, any
other Person. For purposes of any calculation required pursuant to the
Indenture, the value of any Property shall be its Fair Market Value.
"PROPORTIONATE INTEREST" in any issuance of Capital Stock of a
Restricted Subsidiary means a ratio (1) the numerator of which is the aggregate
amount of Capital Stock of such Restricted Subsidiary beneficially owned by the
Company and the Restricted Subsidiaries and (2) the denominator of which is the
aggregate amount of Capital Stock of such Restricted Subsidiary beneficially
owned by all Persons, excluding, in the case of this clause (2), any Investment
made in connection with such issuance.
"PURCHASE MONEY DEBT" means Debt (including Acquired Debt and Capital
Lease Obligations, mortgage financings and purchase money obligations) incurred
for the purpose of financing all or any part of the cost of construction,
installation, acquisition, lease, development or improvement by the Company or
any Restricted Subsidiary of any Telecommunications Assets of the Company or any
Restricted Subsidiary and including any related notes, Guarantees, collateral
documents, instruments and agreements executed in connection therewith, as the
same may be amended, supplemented, modified or restated from time to time.
"QUALIFIED RECEIVABLE FACILITY" means Debt of the Company or any
Subsidiary Incurred from time to time pursuant to either
o credit facilities secured by Receivables or
o Receivables purchase facilities
in each case, including any related notes, Guarantees, collateral documents,
instruments and agreements executed in connection therewith, as the same may be
amended, supplemented, modified or restated from time to time.
"RATING AGENCIES" means Moody's and S&P.
44
<PAGE> 50
"RATING DATE" means the earlier of the date of public notice of the
occurrence of a Change of Control or of the intention of the Company to effect a
Change of Control.
"RATING DECLINE" shall be deemed to have occurred if, no later than 90
days after the Rating Date (which period shall be extended so long as the rating
of the Notes is under publicly announced consideration for possible downgrade by
any of the Rating Agencies), either of the Rating Agencies assigns or reaffirms
a rating to the Notes that is lower than the applicable rating of the Notes on
the date of the Indenture or the equivalent thereof. If, prior to the Rating
Date, either of the ratings assigned to the Notes by the Rating Agencies is
lower than the applicable rating of the Notes on the date of the Indenture, then
a Rating Decline will be deemed to have occurred if such rating is not changed
by the 90th day following the Rating Date. A downgrade within rating categories,
as well as between rating categories, will be considered a Rating Decline.
"RECEIVABLES" means receivables, chattel paper, instruments, documents
or intangibles evidencing or relating to the right to payment of money and
proceeds and products thereof, in each case, generated in the ordinary course of
business.
"REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement
dated as of August 8, 2000 between the Company and the Initial Purchasers party
thereto with respect to the Notes.
"REGULAR RECORD DATE" for the Interest payable on any Interest Payment
Date (except a date for payment of defaulted interest) means the January 15 or
July 15 (whether or not a Business Day), as the case may be, next preceding such
Interest Payment Date.
"REGULATION S" means Regulation S under the Securities Act.
"REGULATION S CERTIFICATE" means a certificate substantially in the
form of Exhibit D hereto.
"REGULATION S GLOBAL NOTE" means a Global Note representing Notes
issued and sold pursuant to Regulation S.
"RESPONSIBLE OFFICER" when used with respect to the Trustee means any
vice president (whether or not designated by numbers or words added before or
after the title "vice president"), any assistant vice president, any assistant
secretary, any assistant treasurer, or any other officer or assistant officer of
the Trustee customarily performing functions similar to those performed by the
persons who at the time shall be such officers, respectively, or to whom any
corporate trust matter
45
<PAGE> 51
is referred because of his or her knowledge of and familiarity with the
particular subject.
"RESTRICTED LEGEND" means the legend set forth in Exhibit A hereto.
"RESTRICTED SUBSIDIARY" means
o a Subsidiary of the Company or of a Restricted Subsidiary that has
not been designated or classified as an Unrestricted Subsidiary
pursuant to and in compliance with Section 3.20, and
o an Unrestricted Subsidiary that is redesignated as a Restricted
Subsidiary pursuant to such covenant.
"RETURNED INVESTMENTS" means, with respect to all Investments made in
Unrestricted Subsidiaries, the aggregate amount of all payments made in respect
of such Investments, other than interest, dividends or other distributions not
in the nature of a return or repurchase of capital or a repayment of principal,
that have been paid or returned, without restriction, to the Company or any
Restricted Subsidiary.
"RULE 144A" means Rule 144A under the Securities Act.
"RULE 144A CERTIFICATE" means a certificate substantially in the form
of Exhibit C hereto.
"RULE 144A GLOBAL NOTE" means a Global Note that bears the Restricted
Legend representing Notes issued and sold pursuant to Rule 144A.
"S&P" means Standard & Poor's Ratings Services or, if Standard & Poor's
Ratings Services shall cease rating debt securities having a maturity at
original issuance of at least one year and such ratings business shall have been
transferred to a successor Person, such successor Person; provided, however,
that if there is no successor Person, then "S&P" shall mean any other national
recognized rating agency, other than Moody's, that rates debt securities having
a maturity at original issuance of at least one year and that shall have been
designated by the Company.
"SALE AND LEASEBACK TRANSACTION" of any Person means any direct or
indirect arrangement pursuant to which any Property is sold or transferred by
such Person or a Restricted Subsidiary of such Person and is thereafter leased
back from the purchaser or transferee thereof by such Person or one of its
Restricted Subsidiaries. The stated maturity of such arrangement shall be the
date of the last
46
<PAGE> 52
payment of rent or any other amount due under such arrangement prior to the
first date on which such arrangement may be terminated by the lessee without
payment of a penalty.
"SECURITIES ACT" means the Securities Act of 1933, as amended.
"SEGMENT" means
o with respect to the Company's intercity network, the
through-portion of such network between two local networks and
o with respect to a local network of the Company, the entire
through-portion of such network, excluding the spurs which branch
off the through-portion.
"SIGNIFICANT SUBSIDIARY" means any Subsidiary that would be a
"significant subsidiary" of the Company within the meaning of Rule 1-02 under
Regulation S-X promulgated by the Commission.
"STATED MATURITY" when used with respect to a Note or any installment
of interest on such Note, means the date specified in such Note as the date
fixed on which the principal of such Note or such installment of interest is due
and payable, including pursuant to any mandatory redemption provision, but
excluding any provision providing for the repurchase of such Note at the option
of the Holder on such note upon the happening of any contingency beyond the
control of the Company unless such contingency has occurred.
"SUBORDINATED DEBT" means Debt of the Company (a) that is not secured
by any Lien on or with respect to any Property now owned or acquired after the
date of the Indenture and (b) as to which the payment of principal of, and
premium, if any, and interest and other payment obligations in respect of such
Debt shall be subordinate to the prior payment in full in cash of the Notes to
at least the following extent:
(1) no payments of principal of, or premium, if any, or
interest on or otherwise due, including by acceleration or for
additional amounts, in respect of, or repurchases, redemptions or other
retirements of, such Debt may be permitted for so long as any default,
after giving effect to any applicable grace periods, in the payment of
principal, or premium, if any, or interest on the Notes exists,
including as a result of acceleration;
(2) if any other Default exists with respect to either series
of Notes, upon notice by Holders of 25% or more in aggregate principal
47
<PAGE> 53
amount of the applicable series of Notes to the Trustee, the Trustee
shall have the right to give notice to the Company and the Holders of
such Debt, or trustees or agents therefor, of a payment blockage, and
thereafter no payments of such Debt may be made for a period of 179
days from the date of such notice; provided that not more than one such
payment blockage notice may be given in any consecutive 360-day period,
irrespective of the number of defaults with respect to the applicable
series of Notes during such period;
(3) if payment of such Debt is accelerated when any Notes are
outstanding, no payments of such Debt may be made until three Business
Days after the Trustee receives notice of such acceleration and,
thereafter, such payments may only be made to the extent the terms of
such Debt permit payment at that time; and
(4) such Debt may not
(x) provide for payments of principal of such Debt at
the stated maturity of such Debt or by way of a sinking fund
applicable to such Debt or by way of any mandatory redemption,
defeasance, retirement or repurchase of such Debt by the
Company, including any redemption, retirement or repurchase
which is contingent upon events or circumstances but excluding
any retirement required by virtue of acceleration of such Debt
upon an event of default thereunder, in each case, prior to
the final Stated Maturity of the Notes, or
(y) permit redemption or other retirement, including
pursuant to an offer to purchase made by the Company, of such
Debt at the option of the Holder of such Debt prior to the
final Stated Maturity of the Notes,
other than, in the case of clause (x) or (y), any such payment,
redemption or other retirement, including pursuant to an offer to
purchase made by the Company, which is conditioned upon
o a change of control of the Company pursuant to provisions
substantially similar to those described in Section 3.18 (and
which shall provide that such Debt will not be repurchased
pursuant to such provisions prior to the Company's repurchase of
the Notes required to be repurchased by the Company pursuant to
the provisions described in Section 3.18), or
48
<PAGE> 54
o a sale or other disposition of assets pursuant to provisions
substantially similar to those described in Section 3.15 (and
which shall provide that such Debt will not be repurchased
pursuant to such provisions prior to the Company's repurchase of
the Notes required to be repurchased by the Company pursuant to
the provision described in Section 3.15).
"SUBSIDIARY" of any Person means:
o a corporation more than 50% of the combined voting power of the
outstanding Voting Stock of which is owned, directly or
indirectly, by such Person or by one or more other Subsidiaries of
such Person or by such Person and one or more Subsidiaries of such
Person; or
o any other Person (other than a corporation) in which such Person,
or one or more other Subsidiaries of such Person or such Person
and one or more other Subsidiaries of such Person, directly or
indirectly, has at least a majority ownership and power to direct
the policies, management and affairs thereof.
"TELECOMMUNICATIONS ASSETS" means:
(a) any Property, other than cash, cash equivalents and
securities, to be owned or used by the Company or any Restricted
Subsidiary and used in the Telecommunications Business;
(b) for purposes of Section 3.08 and Section 3.13 only,
Capital Stock of any Person; or
(c) for all other purposes of the Indenture, Capital Stock of
a Person that becomes a Restricted Subsidiary as a result of the
acquisition of such Capital Stock by the Company or another Restricted
Subsidiary from any Person other than an Affiliate of the Company;
provided, however, that, in the case of clause (b) or (c), such Person is
primarily engaged in the Telecommunications Business.
"TELECOMMUNICATIONS BUSINESS" means the business of:
(1) transmitting, or providing services relating to the
transmission of, voice, video or data through owned or leased
transmission facilities or the right to use such facilities;
49
<PAGE> 55
(2) constructing, creating, developing, operating, managing or
marketing communications networks, related network transmission
equipment, software and other devices for use in a communications
business;
(3) computer outsourcing, data center management, computer
systems integration, reengineering of computer software for any
purpose, including, for the purposes of porting computer software from
one operating environment or computer platform to another or to address
issues commonly referred to as "YEAR 2000 ISSUES";
(4) constructing, managing or operating fiber-optic
telecommunications networks and leasing capacity on those networks to
third parties;
(5) the sale, resale, installation or maintenance of
communications systems and equipment; or
(6) evaluating, participating or pursuing any other activity
or opportunity that is primarily related to those identified in (1),
(2), (3), (4) or (5) above;
provided that the determination of what constitutes a Telecommunications
Business shall be made in good faith by the Board of Directors of the Company.
"TREASURY RATE" means, at any date of determination, the yield to
maturity as of such date (as compiled by and published in the most recent
Federal Reserve Statistical Release H.15 (519), which has become publicly
available at least two business days prior to the date of the redemption notice
for which such computation is being made, or if such Statistical Release is no
longer published, as reported in any publicly available source or similar market
data) of United States Treasury securities with a constant maturity most nearly
equal to the Make- Whole Average Life; provided, however, that if the Make-Whole
Average Life is not equal to the constant maturity of the United States Treasury
security for which a weekly average yield is given, the Treasury Rate shall be
obtained by linear interpolation (calculated to the nearest one-twelfth of a
year) from the weekly average yields of United States Treasury securities for
which such yields are given, except that if the Make-Whole Average Life is less
than one year, the weekly average yield on actually traded United States
Treasury securities adjusted to a constant maturity of one year shall be used.
"TRUST INDENTURE ACT OF 1939" means the Trust Indenture Act of 1939, as
amended, as in force at the date as of which this Indenture was originally
executed,
50
<PAGE> 56
and "TIA", when used in respect of an indenture supplemental hereto, means such
Act as in force at the time such indenture supplemental hereto becomes
effective.
"TRUSTEE" means the entity identified as "Trustee" in the first
paragraph hereof and, subject to the provisions of Article Five, shall also
include any successor trustee.
"UNRESTRICTED SUBSIDIARY" means
o any Subsidiary of the Company designated as such pursuant to and
in compliance with Section 3.20 and not thereafter redesignated as
a Restricted Subsidiary as permitted pursuant to such section, and
o any Subsidiary of an Unrestricted Subsidiary.
"U.S. GOVERNMENT OBLIGATIONS" means securities issued or directly and
fully guaranteed or insured by the United States of America or any agent or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof).
"VOTING STOCK" of any Person means Capital Stock of such Person which
ordinarily has voting power for the election of directors, or persons performing
similar functions, of such Person, whether at all times or only for so long as
no senior class of securities has such voting power by reason of any
contingency.
"WHOLLY OWNED SUBSIDIARY" of any Person means a Subsidiary of such
Person, all of the outstanding Voting Stock or other ownership interests, other
than directors' qualifying shares, of which are at the time owned by such Person
or by one or more Wholly Owned Subsidiaries of such Person or by such Person and
one or more Wholly Owned Subsidiaries of such Person.
"WILLIAMS INTERCOMPANY ARRANGEMENTS" means the Williams Note and any
other documents, instruments, agreements and arrangements between the Company
and any Restricted Subsidiaries, between any Restricted Subsidiaries or between
the Company or any Restricted Subsidiary, on the one hand, and The Williams
Companies, Inc. or any of its Subsidiaries, on the other hand, in effect on the
date of the Indenture, as such documents, instruments, agreements and
arrangements may be amended, modified or supplemented, but only to the extent
any such amendments, modifications or supplements are approved by a majority of
the members of the Board of Directors of the Company who are disinterested with
respect to such amendment, modification or supplement.
51
<PAGE> 57
"WILLIAMS NOTE" means the promissory note of Williams Communications,
Inc., a subsidiary of the Company, dated as of September 8, 1999, to The
Williams Companies, Inc. in the principal amount as of such date equal to $1.0
billion.
SECTION 1.02. Other Definitions.
<TABLE>
<CAPTION>
Defined in
Term Section
---- ----------
<S> <C>
"Acceleration Notice"......................................... 4.02
"Affiliate Transaction"....................................... 3.17
"beneficial owner"............................................ 3.18
"cash transaction"............................................ 5.13
"Covenant Defeasance"......................................... 10.03
"Designation"................................................. 3.20
"Designation Amount........................................... 3.20
"incorporated provision"...................................... 11.07
"Incurrence Date"............................................. 3.08
"Legal Defeasance"............................................ 10.02
"Note Register"............................................... 2.06
"parent corporation".......................................... 3.18
"refinancing"................................................. 3.08
"Registrar"................................................... 2.06
"Required Filing Dates"....................................... 3.19
"Revocation".................................................. 3.20
"self-liquidating paper....................................... 5.13
</TABLE>
ARTICLE 2
ISSUE, EXECUTION, FORM AND REGISTRATION OF NOTES
SECTION 2.01. Authentication and Delivery of Notes. Upon the execution
and delivery of this Indenture, or from time to time thereafter, Notes (whether
Initial Notes or Exchange Notes) in an aggregate principal amount not in excess
of the amount specified in the form of Note hereinabove recited (except as
otherwise provided in Section 2.09) may be executed by the Company and delivered
to the Trustee for authentication, and the Trustee shall thereupon authenticate
and make available for delivery said Notes to or upon the written order of the
Company, signed by its Chairman of the Board of Directors, or any Vice Chairman
of the Board of Directors, or its President or any Vice President (whether or
not designated by a number or numbers or a word or words added before or after
the title "Vice President") without any further action by the Company.
52
<PAGE> 58
SECTION 2.02. Execution of Notes. The Notes shall be signed on behalf
of the Company by its Chairman of the Board of Directors or its President or any
Vice President (whether or not designated by a number or numbers or a word or
words added before or after the title "Vice President"). Such signature may be
the manual or facsimile signatures of the present or any future such officers.
In case any officer of the Company who shall have signed any of the
Notes shall cease to be such officer before the Note so signed shall be
authenticated and delivered by the Trustee or disposed of by the Company, such
Note nevertheless may be authenticated and delivered or disposed of as though
the person who signed such Note had not ceased to be such officer of the
Company; and any Note may be signed on behalf of the Company by such persons as,
at the actual date of the execution of such Note, shall be the proper officers
of the Company, although at the date of the execution and delivery of this
Indenture any such person was not such officer.
SECTION 2.03. Certificate of Authentication. Only such Notes as shall
bear thereon a certificate of authentication substantially in the form
hereinabove recited, executed by the Trustee by manual signature of one of its
authorized signatories, shall be entitled to the benefits of this Indenture or
be valid or obligatory for any purpose. Such certificate by the Trustee upon any
Note executed by the Company shall be conclusive evidence that the Note so
authenticated has been duly authenticated and delivered hereunder and that the
Holder is entitled to the benefits of this Indenture.
SECTION 2.04. Form, Denomination and Date of Notes; Payments of
Interest. The Notes and the Trustee's certificates of authentication shall be
substantially in the form recited above. The Notes shall be issuable in
denominations provided for in the form of Note recited above. The Notes shall be
numbered, lettered, or otherwise distinguished in such manner or in accordance
with such plans as the officers of the Company executing the same may determine
with the approval of the Trustee.
Any of the Notes may be issued with appropriate insertions, omissions,
substitutions and variations, and may have imprinted or otherwise reproduced
thereon such legend or legends, not inconsistent with the provisions of this
Indenture, as may be required to comply with any law or with any rules or
regulations pursuant thereto, including those required by Section 2.05 and
Section 2.08, or with the rules of any securities market in which the Notes are
admitted to trading, or to conform to general usage.
53
<PAGE> 59
Each Note shall be dated the date of its authentication, shall bear
interest from the applicable date and shall be payable on the dates specified on
the face of the form of Note recited above.
The person in whose name any Note is registered at the close of
business on any Regular Record Date with respect to any Interest Payment Date
shall be entitled to receive the interest, if any, payable on such Interest
Payment Date notwithstanding any transfer or exchange of such Note subsequent to
the Regular Record Date and prior to such Interest Payment Date, except if and
to the extent the Company shall default in the payment of the interest due on
such Interest Payment Date, in which case such defaulted interest, plus (to the
extent lawful) any interest payable on the defaulted interest, shall be paid to
the persons in whose names outstanding Notes are registered at the close of
business on a subsequent record date (which shall be not less than five Business
Days prior to the date of such payment) established by notice given by mail by
or on behalf of the Company to the Holders of Notes not less than 15 days
preceding such subsequent record date.
SECTION 2.05. Restricted Legend. (a) Except as otherwise provided in
paragraph (b), each Rule 144A Global Note, and, prior to the expiration of the
Distribution Compliance Period, each Regulation S Global Note, will bear the
Restricted Legend.
(b) (1) If the Company determines (upon the advice of counsel and such
other certifications and evidence as the Company may reasonably
require) that any Note is eligible for resale pursuant to Rule 144(k)
under the Securities Act (or a successor provision) and that the
Restricted Legend is no longer necessary or appropriate in order to
ensure that subsequent transfers of the Note (or a beneficial interest
therein) are effected in compliance with the Securities Act, or
(2) after an Initial Note is (x) sold pursuant to an effective
registration statement under the Securities Act (pursuant to the
Registration Rights Agreement or otherwise) or (y) is validly tendered
for exchange for an Exchange Note pursuant to the Exchange Offer,
the Company may instruct the Trustee to cancel the Note and issue to the Holder
thereof (or to its transferee) a new Note of like tenor and amount, registered
in the name of the Holder thereof (or its transferee), that does not bear the
Restricted Legend, and the Trustee will comply with such instruction.
(c) By its acceptance of any Note bearing the Restricted Legend (or
any beneficial interest in such a Note), each Holder thereof and each owner of a
54
<PAGE> 60
beneficial interest therein acknowledges the restrictions on transfer of such
Note (and any such beneficial interest) set forth in the Indenture and in the
Restricted Legend and agrees that it will transfer such Note (and any such
beneficial interest) only in accordance with the Indenture and such legend.
SECTION 2.06. Restrictions on Transfers and Exchange. (a) The transfer
or exchange of any Note (or a beneficial interest therein) may only be made in
accordance with this Section, Section 2.07 and the applicable rules and
procedures of the Depositary. The Trustee shall refuse to register any requested
transfer or exchange that does not comply with the preceding sentence.
(b) The transfer or exchange of any Note (or a beneficial interest
therein) that bears the Restricted Legend may only be made in compliance with
the provisions of the Restricted Legend.
(c) During the Distribution Compliance Period, the transfer or
exchange of a beneficial interest in a Regulation S Global Note for a beneficial
interest in a Rule 144A Global Note may only be made upon receipt by the Trustee
of a duly completed Rule 144A Certificate.
(d) The transfer or exchange of a beneficial interest in a Rule 144A
Global Note for a beneficial interest in a Regulation S Global Note may only be
made upon receipt by the Trustee of a duly completed Registration S Certificate.
(e) During the Distribution Compliance Period, beneficial interests in
a Regulation S Global Note may be held only through the Depositary acting for
and on behalf of Euroclear and Clearstream, Luxembourg, and their respective
direct and indirect participants.
(f) The Trustee will retain copies of all certificates, opinions and
other documents received in connection with the transfer or exchange of a Note
(or a beneficial interest therein), and the Company will have the right to
inspect and make copies thereof at any reasonable time upon written notice to
the Trustee.
SECTION 2.07. Registration, Transfer and Exchange. (a) Registered
Global Form Only. The Notes will be issued in registered form only. Except under
the circumstances described in Section 2.08(d), the Notes will be issued in
global form only. The Company will keep at each office or agency to be
maintained for the purpose as provided in Section 3.02 (the "REGISTRAR") a
register or registers (the "NOTE REGISTER(S)") in which, subject to such
reasonable regulations as it may prescribe, it will register, and will register
the transfer of, Notes as in this Article provided. Such Note Register shall be
in written form in the English language or in any other form capable of being
converted into such
55
<PAGE> 61
form within a reasonable time. At all reasonable times such Note Register or
Note Registers shall be open for inspection by the Trustee.
Upon due presentation for registration of transfer of any Note at each
such office or agency, the Company shall execute and the Trustee shall
authenticate in accordance with the procedures set forth herein and make
available for delivery in the name of the transferee or transferees a new Note
or Notes in authorized denominations for a like aggregate principal amount.
A Holder may transfer a Note (or a beneficial interest therein) to
another Person or exchange a Note (or a beneficial interest therein) for another
Note or Notes of any authorized denomination only by written application to the
Registrar stating the name of the proposed transferee or requesting such an
exchange and otherwise complying with the terms of this Indenture. No such
transfer shall be effected until, and such transferee shall succeed to the
rights of a Holder only upon, final acceptance and registration of the transfer
by the Registrar in the Note Register. Prior to the registration of any transfer
by a Holder as provided herein, the Company, the Trustee, and any agent of the
Company shall treat the person in whose name the Note is registered as the owner
thereof for all purposes whether or not the Note shall be overdue, and neither
the Company, the Trustee, nor any such agent shall be affected by notice to the
contrary. Furthermore, any Holder of a Global Note shall, by acceptance of such
Global Note, agree that transfers of beneficial interests in such Global Note
may be effected only through a book entry system maintained by the Holder of
such Global Note (or its agent) and that ownership of a beneficial interest in
the Note shall be required to be reflected in a book entry. When Notes are
presented to the Registrar or a co-Registrar with a request to register the
transfer or to exchange them for an equal principal amount of Notes of other
authorized denominations, the Registrar shall register the transfer or make the
exchange as requested if the requirements for such transactions set forth herein
are met. To permit registrations of transfers and exchanges, the Company shall
execute and the Trustee shall authenticate Notes at the Registrar's request.
The Company may require payment of a sum sufficient to cover any tax or
other similar governmental charge that may be imposed in connection with any
exchange or registration of transfer of Notes (other than any such transfer
taxes or other similar governmental charge payable upon exchanges pursuant to
Section 2.11, 7.05 or 9.03). No service charge to any Holder shall be made for
any such transaction.
The Company shall not be required to exchange or register a transfer of
(x) any Notes to be redeemed for a period of 15 days next preceding the first
mailing of notice of redemption of Notes to be redeemed, or (y) any Notes
56
<PAGE> 62
selected, called or being called for redemption except, in the case of any Note
where public notice has been given that such Note is to be redeemed in part, the
portion thereof not so to be redeemed.
All Notes issued upon any transfer or exchange of Notes shall be valid
obligations of the Company, evidencing the same debt, and entitled to the same
benefits under this Indenture, as the Notes surrendered upon such transfer or
exchange (other than exchanges of Exchange Notes for Initial Notes, which shall
have such differing rights as described in the form of Note included in the
recital to this Indenture).
(b) Procedures to Be Followed by the Trustee. (1) Global Note to Global
Note. If a beneficial interest in a Global Note is transferred or exchanged for
a beneficial interest in another Global Note, the Trustee will (x) record a
decrease in the principal amount of the Global Note being transferred or
exchanged equal to the principal amount of such transfer or exchange and (y)
record a like increase in the principal amount of the other Global Note. Any
beneficial interest in one Global Note that is transferred to a Person who takes
delivery in the form of an interest in another Global Note, or exchanged for an
interest in another Global Note, will, upon transfer or exchange, cease to be an
interest in such Global Note and become an interest in the other Global Note
and, accordingly, will thereafter be subject to all transfer and exchange
restrictions, if any, and other procedures applicable to beneficial interests in
such other Global Note for as long as it remains such an interest.
(2) Certificated Note to Certificated Note. If a Certificated Note is
transferred or exchanged for another Certificated Note, the Trustee will (x)
cancel the Certificated Note being transferred or exchanged, (y) deliver one or
more new Certificated Notes in authorized denominations having an aggregate
principal amount equal to the principal amount of such transfer or exchange to
the transferee (in the case of a transfer) or the Holder of the canceled
Certificated Note (in the case of an exchange), registered in the name of such
transferee or Holder, as applicable, and (z) if such transfer or exchange
involves less than the entire principal amount of the canceled Certificated
Note, will deliver to the Holder thereof one or more new Certificated Notes in
authorized denominations having an aggregate principal amount equal to the
untransferred or unexchanged portion of the canceled Certificated Note,
registered in the name of the Holder thereof.
SECTION 2.08. Book-Entry Provisions for Global Notes. (a) Each Global
Note will be registered in the name of the Depositary or its nominee and will
bear the Depositary Legend.
57
<PAGE> 63
(b) Each Rule 144A Global Note will be deposited with the Trustee as
custodian for the Depositary, and each Regulation S Global Note will be
deposited with the Trustee, as custodian for the Depositary for credit to the
respective accounts of Euroclear and Clearstream, Luxembourg. Transfers of a
Global Note (but not a beneficial interest therein) will be limited to transfers
thereof in whole, but not in part, to the Depositary, its successors or their
respective nominees, except (1) as set forth in paragraph (d) of this Section
and (2) transfers of portions thereof in the form of Certificated Notes may be
made upon request of an Agent Member (for itself or on behalf of a beneficial
owner) by written notice given to the Trustee by or on behalf of the Depositary
in accordance with customary procedures of the Depositary and in the compliance
with this Section, Section 2.06 and Section 2.07.
(c) Agent Members will have no rights under the Indenture with respect
to any Global Note held on their behalf by the Depositary, and the Depositary
may be treated by the Company, the Trustee and any agent of the Company or the
Trustee as the absolute owner and Holder of such Global Note for all purposes
whatsoever. Notwithstanding the foregoing, the Depositary or its nominee may
grant proxies and otherwise authorize any person (including any Agent Member and
any Person that holds a beneficial interest in a Global Note through an Agent
Member) to take any action which a Holder is entitled to take under the
Indenture or the Notes, and nothing herein will impair, as between the
Depositary and its Agent Members, the operation of customary practices governing
the exercise of the rights of a holder of any security.
(d) If (x) the Depositary notifies the Company that it is unwilling or
unable to continue as Depositary for a Global Note and a successor depositary is
not appointed by the Company within 90 days of the notice or the Depositary
ceases to be a "CLEARING AGENCY" registered under the Exchange Act, (y) in the
case of a Regulation S Global Note, Euroclear and Clearstream, Luxembourg notify
the Company that they are unwilling or unable to continue as clearing agency or
(z) an Event of Default has occurred and is continuing and the Trustee has
received a request from the Depositary, the Trustee will promptly exchange each
beneficial interest in the Global Note for one or more Certificated Notes in
authorized denominations having an equal aggregate principal amount registered
in the name of the owner of such beneficial interest, as identified to the
Trustee by the Depositary, and thereupon the Global Note will be deemed
canceled. If such Note is a Rule 144A Global Note, and, prior to the expiration
of the Distribution Compliance Period, a Regulation S Global Note, then each
Certificated Note issued in exchange therefor will bear the Restricted Legend.
(e) In connection with the transfer of the entire Global Note of either
series to beneficial owners pursuant to paragraph (d) of this Section, such
Global
58
<PAGE> 64
Note shall be deemed to be surrendered to the Trustee for cancellation, and the
Company shall execute, and the Trustee shall authenticate and deliver, to each
beneficial owner identified by the Depositary in exchange for its beneficial
interest in such Global Note an equal aggregate principal amount of Certificated
Notes of authorized denominations.
(f) The registered Holder of a Global Note may grant proxies and
otherwise authorize any person, including Agent Members and persons that may
hold interests through Agent Members, to take any action which a Holder is
entitled to take under this Indenture or the Notes.
SECTION 2.09. Mutilated, Defaced, Destroyed, Lost and Stolen Notes. In
case any temporary or definitive Note shall become mutilated, defaced or be
apparently destroyed, lost or stolen, the Company in its discretion may execute,
and upon the written request of any officer of the Company, the Trustee shall
authenticate and make available for delivery, a new Note, bearing a number not
contemporaneously outstanding, in exchange and substitution for the mutilated or
defaced Note, or in lieu of and substitution for the Note so apparently
destroyed, lost or stolen. In every case the applicant for a substitute Note
shall furnish to the Company and to the Trustee and any agent of the Company or
the Trustee such security or indemnity as may be required by them to indemnify
and defend and to save each of them harmless and, in every case of destruction,
loss or theft evidence to their satisfaction of the apparent destruction, loss
or theft of such Note and of the ownership thereof.
Upon the issuance of any substitute Note, the Company may require the
payment of a sum sufficient to cover any transfer tax or other similar
governmental charge that may be imposed in relation thereto and any other
expenses (including the fees and expenses of the Trustee) connected therewith.
In case any Note which has matured or is about to mature, or has been called for
redemption in full, shall become mutilated or defaced or be apparently
destroyed, lost or stolen, the Company may, instead of issuing a substitute
Note, pay or authorize the payment of the same (without surrender thereof except
in the case of a mutilated or defaced Note), if the applicant for such payment
shall furnish to the Company and to the Trustee and any agent of the Company or
the Trustee such security or indemnity as any of them may require to save each
of them harmless from all risks, however remote, and, in every case of apparent
destruction, loss or theft, the applicant shall also furnish to the Company and
the Trustee and any agent of the Company or the Trustee evidence to their
satisfaction of the apparent destruction, loss or theft of such Note and of the
ownership thereof.
Every substitute Note issued pursuant to the provisions of this Section
by virtue of the fact that any Note is apparently destroyed, lost or stolen
shall
59
<PAGE> 65
constitute an additional contractual obligation of the Company, whether or not
the apparently destroyed, lost or stolen Note shall be at any time enforceable
by anyone and shall be entitled to all the benefits of (but shall be subject to
all the limitations of rights set forth in) this Indenture equally and
proportionately with any and all other Notes duly authenticated and delivered
hereunder. All Notes shall be held and owned upon the express condition that, to
the extent permitted by law, the foregoing provisions are exclusive with respect
to the replacement or payment of mutilated, defaced, or apparently destroyed,
lost or stolen Notes and shall preclude any and all other rights or remedies
notwithstanding any law or statute existing or hereafter enacted to the contrary
with respect to the replacement or payment of negotiable instruments or other
securities without their surrender.
SECTION 2.10. Cancellation of Notes. All Notes surrendered for payment,
redemption, registration of transfer or exchange, if surrendered to the Company
or any agent of the Company or the Trustee, shall be delivered to the Trustee
for cancellation or, if surrendered to the Trustee, shall be cancelled by it;
and no Notes shall be issued in lieu thereof except as expressly permitted by
any of the provisions of this Indenture. If the Company shall acquire any of the
Notes, such acquisition shall not operate as a redemption or satisfaction of the
indebtedness represented by such Notes unless and until the same are delivered
to the Trustee for cancellation.
SECTION 2.11. Temporary Notes. Pending the preparation of definitive
Notes, the Company may execute and, upon receipt of an order from the Company,
the Trustee shall authenticate and make available for delivery temporary Notes
(printed, lithographed, typewritten or otherwise reproduced, in each case in
form satisfactory to the Trustee). Temporary Notes shall be issuable as
registered Notes without coupons, of any authorized denomination, and
substantially in the form of the definitive Notes but with such omissions,
insertions and variations as may be appropriate for temporary Notes, all as may
be determined by the Company with the concurrence of the Trustee. Temporary
Notes may contain such reference to any provisions of this Indenture as may be
appropriate. Every temporary Note shall be executed by the Company and be
authenticated by the Trustee upon the same conditions and in substantially the
same manner, and with like effect, as the definitive Notes. Without unreasonable
delay the Company shall execute and shall furnish definitive Notes and thereupon
temporary Notes may be surrendered in exchange therefor without charge at each
office or agency to be maintained by the Company for the purpose pursuant to
Section 3.02, and the Trustee shall authenticate and make available for delivery
in exchange for such temporary Notes a like aggregate principal amount of
definitive Notes of authorized denominations. Until so exchanged the temporary
Notes shall be entitled to the same benefits under this Indenture as definitive
Notes.
60
<PAGE> 66
SECTION 2.12. CUSIP Numbers. The Company in issuing the Notes may use a
"CUSIP" number (if then generally in use), and the Trustee shall use the CUSIP
number in notices of redemption or exchange as a convenience to Holders;
provided that any such notice shall state that no representation is made as to
the correctness of such number either as printed on the Notes or as contained in
any notice of redemption or exchange and that reliance may be placed only on the
other identification number printed on the Notes. The Company shall promptly
notify the Trustee of any change in the CUSIP number.
ARTICLE 3
COVENANTS OF THE COMPANY AND THE TRUSTEE
SECTION 3.01. Payment of Principal and Interest. The Company covenants
and agrees that it will duly and punctually pay or cause to be paid the
principal of, and interest on, each of the Notes at the place or places, at the
respective times and in the manner provided in the Notes. Each installment of
interest on the Notes may be paid by mailing checks for such interest payable to
or upon the written order of the Holders of Notes entitled thereto as they shall
appear on the registry books of the Company, or by wire transfer to such Holders
in immediately available funds, to such bank or other entity in the continental
United States as shall be designated by such Holders and shall have appropriate
facilities for such purpose, or in accordance with the standard operating
procedures of the Depositary.
SECTION 3.02. Offices for Payments, etc. So long as any of the Notes
remain outstanding, the Company will maintain in the Borough of Manhattan, The
City of New York, New York, the following: (a) an office or agency where the
Notes may be presented for payment (each, a "PAYING AGENT"), (b) an office or
agency where the Notes may be presented for registration of transfer and for
exchange as in this Indenture provided and (c) an office or agency where notices
and demands to or upon the Company in respect of the Notes or of this Indenture
may be served. The Company will give to the Trustee written notice of the
location of any such office or agency and of any change of location thereof. The
Company hereby initially designates the Corporate Trust Office of the Trustee as
the offices or agencies for each such purpose. In case the Company shall fail to
maintain any such office or agency or shall fail to give such notice of the
location or of any change in the location thereof, presentations and demands may
be made and notices may be served at the Corporate Trust Office.
SECTION 3.03. Appointment to Fill a Vacancy in Office of Trustee. The
Company, whenever necessary to avoid or fill a vacancy in the office of Trustee,
61
<PAGE> 67
will appoint, in the manner provided in Section, a Trustee, so that there shall
at all times be a Trustee hereunder.
SECTION 3.04. Paying Agents. Whenever the Company shall appoint a
Paying Agent other than the Trustee, it will cause such Paying Agent to execute
and deliver to the Trustee an instrument in which such agent shall agree with
the Trustee, subject to the provisions of this Section,
(a) that it will hold all sums received by it as such agent for the
payment of the principal of or interest on the Notes (whether such sums have
been paid to it by the Company or by any other obligor on the Notes) in trust
for the benefit of the Holders of the Notes or of the Trustee,
(b) that it will give the Trustee notice of any failure by the Company
(or by any other obligor on the Notes) to make any payment of the principal of
or interest on the Notes when the same shall be due and payable, and
(c) that it will pay any such sums so held in trust by it to the
Trustee upon the Trustee's written request at any time during the continuance of
the failure referred to in clause (b) above.
The Company will, prior to each due date of the principal of or
interest on the Notes, deposit with the Paying Agent a sum sufficient to pay
such principal or interest, and (unless such paying agent is the Trustee) the
Company will promptly notify the Trustee of any failure to take such action.
If the Company shall act as its own Paying Agent, it will, on or before
each due date of the principal of or interest on the Notes, set aside, segregate
and hold in trust for the benefit of the Holders of the Notes a sum sufficient
to pay such principal or interest so becoming due. The Company will promptly
notify the Trustee of any failure to take such action.
Anything in the prior two paragraphs to the contrary notwithstanding,
in connection with any payment of principal and interest, the Company will, for
so long as the Depositary is a Holder of the Notes, deposit sums with the Paying
Agent sufficient to pay such amounts not later than the time required by the
Depositary's rules and regulations as in effect at the time such payment is due.
Anything in this Section to the contrary notwithstanding, the Company
may at any time, for the purpose of obtaining a satisfaction and discharge of
this Indenture or for any other reason, pay or cause to be paid to the Trustee
all sums held in trust by the Company or any Paying Agent hereunder, as required
by this Section, such sums to be held by the Trustee upon the trusts herein
contained.
62
<PAGE> 68
Anything in this Section to the contrary notwithstanding, the agreement
to hold sums in trust as provided in this Section are subject to the provisions
of Section 10.05 and Section 10.06.
SECTION 3.05. Certificates to Trustee. (a) The Company will deliver to
the Trustee within 90 days after the end of each fiscal year of the Company a
certificate from the principal executive, financial or accounting officer of the
Company stating that such officer has conducted or supervised a review of the
activities of the Company and its Restricted Subsidiaries and the Company's and
its Restricted Subsidiaries' performance under this Indenture and that, to the
best of such officer's knowledge, based upon such review, there has been no
Default that is continuing thereunder or, if there has been a Default in the
fulfillment of any such obligation, specifying each such Default and the nature
and status thereof.
(b) The Company will deliver to the Trustee, as soon as possible and in
any event within 30 days after the occurrence thereof, written notice in the
form of an Officers' Certificate of any event which with the giving of notice
and the lapse of time would become an Event of Default, setting forth the status
of such event and what action the Company is taking or proposes to take with
respect thereto.
(c) The Company will deliver to the Trustee within 120 days after the
end of each fiscal year of the Company a written statement by the Company's
independent public accountants stating (i) that their audit examination has
included a review of the terms of this Indenture and the Notes as they relate to
accounting matters, and (ii) whether, in connection with their audit
examination, any Default that is continuing has come to their attention and, if
such a Default has come to their attention, specifying the nature and period of
the existence thereof.
SECTION 3.06. Noteholders' Lists. If and so long as the Trustee shall
not be the Registrar, the Company will furnish or cause to be furnished to the
Trustee a list in such form as the Trustee may reasonably require of the names
and addresses of the Holders of the Notes pursuant to Section 312 of the Trust
Indenture Act of 1939 (a) semi-annually not more than 15 days after each Regular
Record Date as of such Regular Record Date, and (b) at such other times as the
Trustee may request in writing, within thirty days after receipt by the Company
of any such request as of a date not more than 15 days prior to the time such
information is furnished.
SECTION 3.07. Reports by the Trustee. (a) The Trustee shall transmit to
Holders such reports concerning the Trustee and its actions under this Indenture
as may be required pursuant to the Trust Indenture Act of 1939 at the times and
in the manner provided pursuant thereto. If required by Section 313(a) of the
Trust Indenture Act of 1939, the Trustee shall, within sixty days after each
August 15
63
<PAGE> 69
following the date of this Indenture deliver to Holders a brief report, dated as
of such August 15, which complies with the provisions of such Section 313(a).
(b) A copy of each such report shall, at the time of such transmission
to Holders, be filed by the Trustee with each stock exchange, if any, upon which
the Notes are listed, with the Commission and with the Company. The Company will
promptly notify the Trustee when the Notes are listed on any stock exchange or
of any delisting thereof.
SECTION 3.08. Limitation on Consolidated Debt. (a) The Company may not,
and may not permit any Restricted Subsidiary to, directly or indirectly, Incur
any Debt, unless, after giving pro forma effect to such Incurrence and the
receipt and application of the net proceeds of such Incurrence, no Default or
Event of Default would occur as a consequence of such Incurrence or be
continuing following such Incurrence and either:
(1) the ratio of (A) the aggregate consolidated principal
amount (or, in the case of Debt issued at a discount, the then Accreted
Value) of Debt of the Company outstanding as of the most recent
available quarterly or annual balance sheet, after giving pro forma
effect to
o the Incurrence of such Debt and any other Debt
Incurred and that remains outstanding on the date as
of which the Debt to be Incurred is to be Incurred
(the "INCURRENCE DATE") since such balance sheet date
and the receipt and application of the net proceeds
thereof, in each case, as if such Incurrence, receipt
and application had occurred on such balance sheet
date, and
o the repayment, repurchase, retirement or
extinguishment of any Debt since such balance sheet
date, as if such repayment, repurchase, retirement or
extinguishment had occurred on such balance sheet
date, to
(B) Consolidated Cash Flow Available for Fixed
Charges for the four full fiscal quarters next preceding the
Incurrence of such Debt for which consolidated financial
statements are available, determined on a pro forma basis as
if any such Debt had been Incurred and the proceeds of such
Debt had been applied, and any material Investment in, or
acquisition or disposition of, any material asset outside the
ordinary course of business consummated during, or since the
end of, such period of four fiscal quarters had occurred at
the beginning of such four fiscal quarters,
64
<PAGE> 70
would be less than 5.0 to 1.0; or
(2) The Company's Consolidated Capital Ratio is less than 2.25
to 1.0 as of the most recent available quarterly or annual balance
sheet, after giving pro forma effect to
o the Incurrence of such Debt and any other Debt
Incurred and that remains outstanding on the
Incurrence Date since such balance sheet date as if
such Incurrence had occurred on such balance sheet
date,
o the repayment, repurchase, retirement or
extinguishment of any Debt since such balance sheet
date, as if such repayment, repurchase or
extinguishment had occurred on such balance sheet
date,
o the issuance of any Capital Stock (other than
Disqualified Stock) of the Company since such balance
sheet date, including the issuance of any Capital
Stock to be issued concurrently with the Incurrence
of such Debt, as if such Incurrence had occurred on
such balance sheet date, and
o the receipt and application of the net proceeds of
such Debt or Capital Stock, as the case may be, as if
such receipt and application of the proceeds
therefrom had occurred on the balance sheet date.
(b) The restrictions in paragraph (a) do not prevent the Company or
any Restricted Subsidiary from Incurring any and all of the following, each of
which shall be given independent effect:
(1) Debt under the Notes, the Indenture or any Domestic
Restricted Subsidiary Guarantee;
(2) Debt under Credit Facilities in an aggregate principal
amount outstanding or available (together with all refinancing Debt
outstanding or available pursuant to clause (8) below in respect of
Debt previously Incurred pursuant to this clause (2)) at any one time
not to exceed the greater of
(x) $2.0 billion, less
65
<PAGE> 71
o the amount of all mandatory principal
payments actually made by the Company or any
Restricted Subsidiary in respect of term
loans thereunder (excluding any such
payments to the extent refinanced at the
time of payment under a new Credit
Facility), and
o in the case of a revolving facility, reduced
by any required permanent repayments
actually made (which are accompanied by a
corresponding permanent commitment
reduction) under the revolving facility
(excluding any such repayments and
commitment reductions to the extent
refinanced and replaced at the time under a
new Credit Facility), and
(y) 85% of the Eligible Receivables;
(3) Purchase Money Debt; provided that the amount of such
Purchase Money Debt does not exceed 100% of the cost of the
construction, installation, acquisition, lease, development or
improvement of the applicable Telecommunications Assets;
(4) Subordinated Debt of the Company; provided, however, that
the aggregate principal amount of such Debt, together with any other
outstanding Debt Incurred pursuant to this clause (4), shall not exceed
$500 million at any one time (which amount shall be permanently reduced
by the amount of Net Available Proceeds used to repay Subordinated Debt
of the Company, and not reinvested in Telecommunications Assets or used
to purchase Notes or repay other Debt, pursuant to the covenant
described in Section 3.15), except to the extent such Debt in excess of
$500 million
(A) is subordinated to all other Debt of the Company
other than Debt Incurred pursuant to this clause (4) in excess
of such $500 million limitation,
(B) does not provide for the payment of cash interest
on such Debt prior to the Stated Maturity of the Notes, and
(C) does not
o provide for payments of principal of such
Debt at stated maturity or by way of a
sinking fund
66
<PAGE> 72
applicable to the payment of such Debt or by
way of any mandatory redemption, defeasance,
retirement or repurchase thereof by the
Company (including any redemption,
retirement or repurchase which is contingent
upon events or circumstances, but excluding
any retirement required by virtue of the
acceleration of any payment with respect to
such Debt upon any event of default under
such Debt), in each case, on or prior to the
Stated Maturity of the Notes, and
o permit redemption or other retirement
(including pursuant to an offer to purchase
made by the Company) of such Debt at the
option of the holder of such Debt on or
prior to the Stated Maturity of the Notes,
other than, in the case of each of these points under (C), a redemption
or retirement at the option of the holder of such Debt, including
pursuant to an offer to purchase made by the Company, which is
conditioned upon a change of control or asset disposition pursuant to
provisions substantially similar to those described in Section 3.15 and
Section 3.18;
(5) Debt outstanding on the date of the Indenture;
(6) Debt owed by the Company to any Restricted Subsidiary of
the Company or Debt owed by a Restricted Subsidiary of the Company to
the Company or a Restricted Subsidiary of the Company; provided,
however, that
o upon any subsequent transfer, conveyance or other
disposition by any such Restricted Subsidiary or the
Company of any Debt so permitted to a Person other
than the Company or another Restricted Subsidiary of
the Company, or
o if for any reason such Restricted Subsidiary ceases
to be a Restricted Subsidiary,
the provisions of this clause (6) shall no longer be applicable to such
Debt and such Debt shall be deemed to have been Incurred by the issuer
thereof at the time of such transfer, conveyance or other disposition
or when such Restricted Subsidiary ceases to be a Restricted
Subsidiary;
67
<PAGE> 73
(7) Debt Incurred by a Person prior to the time
(A) such Person became a Restricted Subsidiary,
(B) such Person merges into or consolidates with a
Restricted Subsidiary, or
(C) another Restricted Subsidiary merges into or
consolidates with such Person, in a transaction in which such
Person becomes a Restricted Subsidiary, which Debt was not
Incurred with, or in anticipation of, such transaction or such
Person becoming a Restricted Subsidiary;
(8) Debt Incurred to renew, extend, refinance, defease, repay,
replace, prepay, repurchase, redeem, retire, exchange or refund (each,
a "REFINANCING") Debt Incurred pursuant to clause (1), (2), (3), (5),
(7), (12) or (13) of this paragraph (b) or this clause (8), in an
aggregate principal amount, or if issued at a discount, the then
Accreted Value, not to exceed the aggregate principal amount, or if
issued at a discount, the then Accreted Value, of and accrued interest
on the Debt so refinanced plus the amount of any premium, accrued
interest, prepayment penalties, fees and expenses required to be paid
with such refinancing pursuant to the terms of the Debt so refinanced
or the amount of any premium or accrued interest reasonably determined
by the Board of Directors of the Company as necessary to accomplish
such refinancing by means of a redemption, tender offer or privately
negotiated repurchase plus the amount of fees and expenses incurred
with such redemption, tender offer or privately negotiated repurchase;
provided, however, that
o the refinancing Debt shall not be senior in right of
payment to the Debt that is being refinanced, and
o in the case of any refinancing of Debt Incurred
pursuant to clause (1), (5), (7) or (12) or, if such
Debt previously refinanced Debt Incurred pursuant to
any such clause, this clause (8), the refinancing
Debt by its terms, or by the terms of any agreement
or instrument pursuant to which such Debt is issued,
(x) does not provide for payments of principal of such Debt at
stated maturity or by way of a sinking fund applicable to the payment
of such Debt or by way of any mandatory redemption, defeasance,
retirement or repurchase thereof by the Company, including any
redemption,
68
<PAGE> 74
retirement or repurchase which is contingent upon events or
circumstances, but excluding any retirement required by virtue of the
acceleration of any payment with respect to such Debt upon any event of
default under such Debt, in each case, prior to the time the same are
required by the terms of the Debt being refinanced, and
(y) does not permit redemption or other retirement, including
pursuant to an offer to purchase made by the Company, of such Debt at
the option of the holder of such Debt prior to the time the same are
required by the terms of the Debt being refinanced,
other than, in the case of clause (x) or (y), any such payment,
redemption or other retirement, including pursuant to an offer to
purchase made by the Company, which is conditioned upon a change of
control or asset sale pursuant to provisions substantially similar to
those in Section 3.15 and Section 3.18;
provided further that the above clauses (x) and (y) and the limitation
on the aggregate principal amount referred to above in this clause (8)
shall not apply to any refinancing of all of the Notes then
outstanding;
(9) Debt
(A) in respect of performance, surety or appeal bonds,
Guarantees, letters of credit or reimbursement obligations
Incurred or provided in the ordinary course of business
securing the performance of contractual, franchise, lease,
self-insurance or license obligations and not in connection
with the Incurrence of Debt, or
(B) in respect of customary agreements providing for
indemnification, adjustment of purchase price after closing,
or similar obligations, or from Guarantees or letters of
credit, surety bonds or performance bonds securing any such
obligations of the Company or any of its Restricted
Subsidiaries pursuant to such agreements, Incurred in
connection with the disposition of any business, assets or
Restricted Subsidiary of the Company (other than Guarantees of
Debt Incurred by any Person acquiring all or any portion of
such business, assets or Restricted Subsidiary of the Company
for the purpose of financing such acquisition) and in an
aggregate principal amount not to exceed the gross proceeds
actually received by the Company or any Restricted Subsidiary
in connection with such disposition;
69
<PAGE> 75
(10) Debt consisting of Permitted Interest Rate or Currency
Protection Agreements;
(11) Debt secured by Receivables originated by the Company or
any Restricted Subsidiary and related assets; provided that such Debt
is nonrecourse to the Company and any of its other Restricted
Subsidiaries; provided further, that Receivables shall not be available
at any time to secure Debt under this clause (11) to the extent that
they are used as the basis for the Incurrence of Debt pursuant to
clause (2) (y) of this paragraph (b);
(12) Debt Incurred after the date of the Indenture pursuant to
the Williams Note, including Debt Incurred in lieu of payments under
the Williams Intercompany Arrangements and any accrual of interest that
is capitalized under, or added to the principal amount of, the Williams
Note; provided that the aggregate amount of such Debt Incurred in lieu
of payments under the Williams Intercompany Arrangements, other than in
respect of any such accrual of interest, in reliance on this clause
(12) does not exceed $25 million in any 12-month period;
(13) Debt Incurred pursuant to the lease, dated as of
September 2, 1998, between 1998 WCI Trust, as lessor, and Williams
Communications, Inc., as lessee, in an aggregate principal amount not
to exceed $750 million at any one time outstanding; and
(14) Debt not otherwise permitted to be Incurred pursuant to
clauses (1) through (13) above, which, together with any other
outstanding Debt Incurred pursuant to this clause (14), has an
aggregate principal amount not in excess of $50 million at any time
outstanding.
Notwithstanding any other provision of this Section, the maximum amount
of Debt that the Company or a Restricted Subsidiary may Incur pursuant to this
Section will not be exceeded solely as a result of fluctuations in the exchange
rates of currencies.
For purposes of determining any particular amount of Debt under this
Section:
o Guarantees, Liens or obligations with respect to letters of credit
supporting Debt otherwise included in the determination of such
particular amount shall not be included; and
70
<PAGE> 76
o any Liens granted for the benefit of the Notes pursuant to the
equal and ratable provisions referred to in Section 3.13, and
Liens granted for the benefit of the Company's senior redeemable
notes issued under the 1999 Indenture pursuant to the equal and
ratable provisions of the 1999 Indenture governing limitation on
Liens, shall not be treated as Debt.
For purposes of determining compliance with this Section, if an item of
Debt meets the criteria of more than one of the types of Debt described in the
above clauses, the Company, in its sole discretion, may classify such item of
Debt and only be required to include the amount and type of such Debt in one of
such clauses, but also may classify a portion of such item of Debt in more than
one of such clauses and in any order the Company so chooses.
SECTION 3.09. Limitation on Debt of Restricted Subsidiaries. The
Company may not permit any Restricted Subsidiary that is not a Guarantor to
Incur any Debt except any and all of the following, each of which shall be given
independent effect:
(1) Domestic Restricted Subsidiary Guarantees;
(2) Debt outstanding on the date of the Indenture;
(3) Debt of Restricted Subsidiaries under Credit Facilities
permitted to be Incurred pursuant to clause (2) of paragraph (b) of
Section 3.08;
(4) Purchase Money Debt of Restricted Subsidiaries permitted
to be Incurred pursuant to clause (3) of paragraph (b) of Section 3.08;
(5) Debt owed by a Restricted Subsidiary to the Company or a
Restricted Subsidiary of the Company permitted to be Incurred pursuant
to clause (6) of paragraph (b) of Section 3.08;
(6) Debt of Restricted Subsidiaries consisting of Permitted
Interest Rate or Currency Protection Agreements permitted to be
Incurred pursuant to clause (10) of paragraph (b) of Section 3.08;
(7) Debt of Restricted Subsidiaries permitted to be Incurred
under clause (7) of paragraph (b) of Section 3.08;
(8) Debt of Restricted Subsidiaries permitted to be Incurred
under clause (9) or (14) of paragraph (b) of Section 3.08;
71
<PAGE> 77
(9) Debt of Restricted Subsidiaries secured by Receivables
originated by the Company or any Restricted Subsidiary and related
assets permitted to be Incurred under clause (11) of paragraph (b) of
Section 3.08;
(10) Debt permitted to be Incurred pursuant to clause (12) of
paragraph (b) of Section 3.08;
(11) Debt Incurred pursuant to the lease, dated as of
September 2, 1998, between 1998 WCI Trust, as lessor, and Williams
Communications, Inc., as lessee, in an aggregate principal amount not
to exceed $750 million at any one time outstanding; and
(12) Debt which is Incurred to refinance any Debt of a
Restricted Subsidiary permitted to be Incurred pursuant to clauses (1),
(2), (3), (4), (7), (10) or (11) of this paragraph or this clause (12),
in an aggregate principal amount (or if issued at a discount, the then
Accreted Value) not to exceed the aggregate principal amount (or if
issued at a discount, the then Accreted Value) of the Debt so
refinanced, plus the amount of any premium, prepayment penalties,
accrued interest, fees and expenses required to be paid for such
refinancing pursuant to the terms of the Debt so refinanced or the
amount of any premium or accrued interest reasonably determined by the
Board of Directors of the Company as necessary to accomplish such
refinancing by means of a redemption, tender offer or privately
negotiated repurchase, plus the amount of fees and expenses of the
Company and the applicable Restricted Subsidiary Incurred with such
refinancing; provided, however, that, in the case of any refinancing of
Debt Incurred pursuant to clause (1), (2) or (7) of this paragraph or,
if such Debt previously refinanced Debt Incurred pursuant to any such
clause, this clause (12), the refinancing Debt by its terms, or by the
terms of any agreement or instrument pursuant to which such Debt is
issued,
(x) does not provide for payments of principal at the
stated maturity of such Debt or by way of a sinking fund
applicable to such Debt or by way of any mandatory redemption,
defeasance, retirement or repurchase of such Debt by the
Company or any Restricted Subsidiary, including any
redemption, retirement or repurchase which is contingent upon
events or circumstances, but excluding any retirement required
by virtue of acceleration of such Debt upon an event of
default thereunder, in each case prior to the time the same
are required by the terms of the Debt being refinanced, and
72
<PAGE> 78
(y) does not permit redemption or other retirement,
including pursuant to an offer to purchase made by the Company
or a Restricted Subsidiary, of such Debt at the option of the
holder of such Debt prior to the stated maturity of the Debt
being refinanced,
other than, in the case of clause (x) or (y), any such payment,
redemption or other retirement, including pursuant to an offer to
purchase made by the Company or a Restricted Subsidiary, which is
conditioned upon the change of control or asset sale of the Company
pursuant to provisions substantially similar to those in Section 3.15
and Section 3.18;
provided further that the above clauses (x) and (y) and the limitation
on the aggregate principal amount referred to above in this clause (12)
shall not apply to any refinancing of all of the Notes then
outstanding.
Notwithstanding any other provision of this Section, the maximum amount
of Debt that a Restricted Subsidiary may Incur pursuant to this Section will not
be exceeded solely as a result of fluctuations in the exchange rates of
currencies.
For purposes of determining any particular amount of Debt under this
Section, Guarantees, Liens or obligations with respect to letters of credit
supporting Debt otherwise included in the determination of such particular
amount shall not be included. For purposes of determining compliance with this
Section, if an item of Debt meets the criteria of more than one of the types of
Debt described in the above clauses, the Company, in its sole discretion, may
classify such item of Debt and only be required to include the amount and type
of such Debt in one of such clauses, but also may classify a portion of such
item of Debt in more than one of such clauses and in any order the Company so
chooses.
SECTION 3.10. Limitation on Issuances of Guarantees by, and Debt
Securities of, Domestic Restricted Subsidiaries. The Company will not permit any
of its Domestic Restricted Subsidiaries, directly or indirectly, to issue or
Guarantee any Debt Securities, unless such Domestic Restricted Subsidiary
simultaneously executes and delivers a supplemental indenture to the Indenture
providing for the Guarantee of the payment of the Notes by such Domestic
Restricted Subsidiary, which Guarantee shall be senior to or rank equally with
such Debt Securities.
Any such Guarantee by a Domestic Restricted Subsidiary of the Notes
shall provide by its terms that it shall be automatically and unconditionally
released and discharged upon a sale or other disposition, by way of merger or
otherwise, to any Person not an Affiliate of the Company, of the Company's
equity interest in, or the assets of, such Domestic Restricted Subsidiary, which
sale or other disposition results in such Domestic Restricted Subsidiary ceasing
to be a Domestic Restricted
73
<PAGE> 79
Subsidiary and such sale or other disposition is made in compliance with, and
the Net Available Proceeds therefrom are applied in accordance with, the
applicable provisions of the Indenture.
The foregoing provisions will not be applicable to:
o Guarantees of Debt Securities of a Person by its subsidiaries in
effect prior to the time such Person is merged with or into or
became a Domestic Restricted Subsidiary, provided that such
Guarantees do not extend to any other Debt Securities of such
Person or any other Person; and
o any one or more Guarantees of up to $100 million in aggregate
principal amount of Debt Securities of the Company or any Domestic
Restricted Subsidiary at any time outstanding.
SECTION 3.11. Limitation on Restricted Payments. (a) The Company:
(1) may not, and may not permit any Restricted Subsidiary to,
directly or indirectly, declare or pay any dividend, or make any
distribution, in respect of its Capital Stock or to the holders of its
Capital Stock, excluding any dividends or distributions which are made
solely to the Company or a Restricted Subsidiary (and, if such
Restricted Subsidiary declaring, paying or making any such dividend or
distribution is not a Wholly Owned Subsidiary, to the other
stockholders or equity owners of such Restricted Subsidiary on a pro
rata basis or on a basis that results in the receipt by the Company or
a Restricted Subsidiary of dividends or distributions of greater value
than it would receive on a pro rata basis) or any dividends or
distributions payable solely in shares of Capital Stock of the Company,
other than Disqualified Stock, or in options, warrants or other rights
to acquire Capital Stock of the Company, other than Disqualified Stock;
(2) may not, and may not permit any Restricted Subsidiary to,
purchase, redeem, or otherwise retire or acquire for value
o any Capital Stock of the Company or any Restricted
Subsidiary of the Company, or
o any options, warrants or rights to purchase or
acquire shares of Capital Stock of the Company or any
Restricted Subsidiary or any securities convertible
into or exchangeable
74
<PAGE> 80
for shares of Capital Stock of the Company or any
Restricted Subsidiary,
except, in any such case, any such purchase, redemption or retirement
or acquisition for value
o paid to the Company or a Restricted Subsidiary (or,
in the case of any such purchase, redemption or other
retirement or acquisition for value with respect to a
Restricted Subsidiary that is not a Wholly Owned
Subsidiary, to the other stockholders or equity
owners of such Restricted Subsidiary on a pro rata
basis or on a basis that results in the receipt by
the Company or a Restricted Subsidiary of payments of
greater value than it would receive on a pro rata
basis), or
o paid solely in shares of Capital Stock, other than
Disqualified Stock, of the Company;
(3) may not make, or permit any Restricted Subsidiary to make,
any Investment, other than an Investment in the Company or a Restricted
Subsidiary or a Permitted Investment, in any other Person, including
the Designation of any Restricted Subsidiary as an Unrestricted
Subsidiary, or the Revocation of any such Designation, according to
Section 3.20;
(4) may not, and may not permit any Restricted Subsidiary to,
redeem, defease, repurchase, retire or otherwise acquire or retire for
value, prior to any scheduled maturity, repayment or sinking fund
payment, Debt of the Company which is subordinate in right of payment
to the Notes (other than any redemption, defeasance, repurchase,
retirement or other acquisition or retirement for value made in
anticipation of satisfying a scheduled maturity, repayment or sinking
fund obligation due within one year thereof); and
(5) may not, and may not permit any Restricted Subsidiary to,
issue, transfer, convey, sell or otherwise dispose of Capital Stock of
any Restricted Subsidiary to a Person other than the Company or another
Restricted Subsidiary if the result thereof is that such Restricted
Subsidiary shall cease to be a Restricted Subsidiary, in which event
the amount of such "Restricted Payment" shall be the Fair Market Value
of the remaining interest, if any, in such former Restricted Subsidiary
held by the Company and the other Restricted Subsidiaries;
75
<PAGE> 81
each of clauses (1) through (5) being a "RESTRICTED PAYMENT," if:
(A) an Event of Default, or an event that with the
passing of time or the giving of notice, or both, would
constitute an Event of Default, shall have occurred and be
continuing; or
(B) upon giving effect to such Restricted Payment, the
Company could not Incur at least $1.00 of additional Debt
pursuant to paragraph (a) of Section 3.08; or
(C) upon giving effect to such Restricted Payment, the
aggregate of all Restricted Payments made on or after October
6, 1999, plus Permitted Investments made on or after October
6, 1999 pursuant to clause (i) or (n) of the definition
thereof, other than any such Permitted Investments that are
Permitted Investments in the Company or any Restricted
Subsidiary (the amount of any such Restricted Payment or
Permitted Investment, if made other than in cash, to be based
upon Fair Market Value), exceeds the sum of:
o 50% of cumulative Consolidated Net Income (or, if
Consolidated Net Income is negative, 100% of such
negative amount) since March 31, 2000, through the
last day of the last full fiscal quarter for which
consolidated financial statements are available;
o in the case of any Revocation made after October 6,
1999, an amount equal to the lesser of the portion
(proportionate to the Company's direct or indirect
equity interest in the Subsidiary to which such
Revocation relates) of the Fair Market Value of the
net assets of such Subsidiary at the time of
Revocation and the amount of Investments previously
made (and treated as a Restricted Payment) by the
Company or any Restricted Subsidiary in such
Subsidiary; and
o the aggregate amount of Returned Investments since
October 6, 1999 and on or prior to the date of such
Restricted Payment;
provided, however, that the Company or a Restricted Subsidiary of the
Company may, without regard to the limitations in clause (C) but
subject to clauses (A) and (B) above, make Restricted Payments in an
aggregate
76
<PAGE> 82
amount not to exceed the sum of $50 million and the aggregate net cash
proceeds received after October 6, 1999:
(1) as capital contributions to the Company, or proceeds
from the issuance, other than to a Subsidiary, of Capital
Stock, other than Disqualified Stock, of the Company and
options, warrants or rights to purchase or acquire shares of
Capital Stock (other than Disqualified Stock) of the Company,
and
(2) from the issuance or sale of Debt of the Company or
any Restricted Subsidiary, other than to a Subsidiary, the
Company or a Plan, that after October 6, 1999 has been
converted into or exchanged for Capital Stock, other than
Disqualified Stock, of the Company;
provided further that, in the case of the issuance of Capital Stock of
the Company to any Plan, if such Plan Incurs any Debt for the purpose
of purchasing such Capital Stock, the aggregate net cash proceeds from
such issuance shall be included for purposes of the above proviso only
to the extent of any increase in the Consolidated Net Worth of the
Company resulting from principal repayments made with respect to the
Debt Incurred to finance the purchase of such Capital Stock.
The aggregate net cash proceeds referred to in the immediately
preceding clauses (1) and (2) shall not be utilized to make Restricted Payments
pursuant to such clauses to the extent such proceeds have been utilized to make
Permitted Investments under clause (i) of the definition of "Permitted
Investments."
(b) The restrictions in paragraph (a) do not prevent the following:
(1) The Company or any Restricted Subsidiary may pay any
dividend on Capital Stock of any class of the Company or such
Restricted Subsidiary within 60 days after the declaration of such
dividend if, on the date when the dividend was declared, the Company or
such Restricted Subsidiary, as the case may be, could have paid such
dividend in accordance with the above provisions; provided, however,
that at the time of such payment of such dividend, no other Event of
Default shall have occurred and be continuing, or result from, the
payment of such dividend;
(2) The Company or any Restricted Subsidiary may repurchase,
redeem, acquire, cancel or otherwise retire for value any shares of its
Common Stock or options to acquire its Common Stock from Persons who
are currently or were formerly directors, officers or employees of the
77
<PAGE> 83
Company or any of its Subsidiaries or other Affiliates, or their
estates or beneficiaries under their estates, or from any Plan, upon
death, disability, retirement or termination of employment in an amount
not to exceed $3 million in any 12-month period;
(3) The Company and any Restricted Subsidiary may refinance
any Debt otherwise permitted by clause (8) of paragraph (b) of Section
3.08 or clause (12) of Section 3.09;
(4) The Company and any Restricted Subsidiary may retire or
repurchase any Capital Stock of the Company or of any Restricted
Subsidiary or any Subordinated Debt of the Company in exchange for, or
out of the proceeds of the substantially concurrent sale, other than to
a Subsidiary of the Company or any Plan, of, Capital Stock, other than
Disqualified Stock, of the Company; provided that the proceeds from any
such exchange or sale of Capital Stock shall be excluded from any
calculation pursuant to clause (b) of the definition of "Invested
Capital";
(5) The Company or any Restricted Subsidiary may purchase
shares of Capital Stock of the Company or any Restricted Subsidiary of
the Company for the purpose of contributing such shares to any Plan;
provided that all such purchases referred to in this clause (5) may not
exceed $10 million in any 12-month period;
(6) The Company or any Restricted Subsidiary may purchase all,
but not less than all, excluding directors' qualifying shares, of the
Capital Stock or other ownership interests in a Subsidiary of the
Company which Capital Stock or other ownership interests were not until
that time owned by the Company or a Subsidiary of the Company such that
after giving effect to such purchase such Subsidiary becomes a Wholly
Owned Subsidiary of the Company;
(7) The Company or any Restricted Subsidiary may redeem,
defease, repurchase, retire or acquire for value any Subordinated Debt
upon a Change of Control or Asset Disposition to the extent required by
the Indenture or other agreement pursuant to which such Subordinated
Debt was issued, but only if the Company has first complied with its
obligations under Section 3.15 and Section 3.18; and
(8) The Company or any Restricted Subsidiary may make
distributions to the stockholders or equity owners of Restricted
Subsidiaries that are partnerships, limited liability companies that
are treated as partnerships for U.S. tax purposes or other similar
pass-through
78
<PAGE> 84
entities in order to reimburse or compensate such other stockholders or
equity owners for income taxes attributable to the operations of such
Restricted Subsidiaries as required by the formation agreement,
operating agreement or partnership agreement or similar governing
document of the Restricted Subsidiary.
The Restricted Payments described in the foregoing clauses (1), (2),
(5), (6) and (7) shall be included in the calculation of Restricted Payments;
the Restricted Payments described in clauses (3), (4) and (8) shall be excluded
in the calculation of Restricted Payments.
SECTION 3.12. Limitation on Dividend and Other Payment Restrictions
Affecting Restricted Subsidiaries. (a) The Company may not, and may not permit
any Restricted Subsidiary to, directly or indirectly, create or otherwise cause
or suffer to exist or become effective any consensual encumbrance or
restriction, other than pursuant to law or regulation, on the ability of any
Restricted Subsidiary:
(1) to pay dividends, in cash or otherwise, or make any other
distributions in respect of its Capital Stock owned by the Company or
any other Restricted Subsidiary or pay any Debt or other obligation
owed to the Company or any other Restricted Subsidiary,
(2) to make loans or advances to the Company or any other
Restricted Subsidiary, or
(3) to transfer any of its Property to the Company or any
other Restricted Subsidiary.
(b) Despite the above limitation, the Company may, and may permit any
Restricted Subsidiary to, create or otherwise cause or suffer to exist:
(1) any encumbrance or restriction pursuant to any agreement
in effect on the date of the Indenture or pursuant to the Permanent
Credit Facility (or, in each case, encumbrances or restrictions that
are substantially similar taken as a whole);
(2) any customary (as conclusively determined in good faith by
the Chief Financial Officer of the Company) encumbrance or restriction
applicable to a Restricted Subsidiary that is contained in an agreement
or instrument governing or relating to Debt contained in any Credit
Facilities or Purchase Money Debt; provided that such encumbrances and
restrictions do not prohibit the distribution of funds to the Company
in an
79
<PAGE> 85
amount sufficient for the Company to make the timely payment of
interest, premium, if any, and principal (whether at stated maturity,
by way of a sinking fund applicable thereto, by way of any mandatory
redemption, defeasance, retirement or repurchase thereof, including
upon the occurrence of designated events or circumstances or by virtue
of acceleration upon an event of default, or by way of redemption or
retirement at the option of the holder of the Debt, including pursuant
to offers to purchase) according to the terms of the Indenture and the
Notes and other Debt that is solely an obligation of the Company;
provided further that such agreement may nevertheless contain customary
(as so determined) net worth, restricted payment, leverage, interest
coverage, invested capital and other financial covenants, customary (as
so determined) covenants regarding the merger of or sale of all or any
substantial part of the assets of the Company or any Restricted
Subsidiary, customary (as so determined) restrictions on transactions
with affiliates and customary (as so determined) subordination
provisions governing Debt owed to the Company or any Restricted
Subsidiary;
(3) any encumbrance or restriction pursuant to an agreement
relating to any Acquired Debt, which encumbrance or restriction is not
applicable to any Person, or the properties or assets of any Person,
other than the Person so acquired;
(4) any encumbrance or restriction pursuant to an agreement
effecting a refinancing of Debt Incurred pursuant to an agreement
referred to in clause (1), (2) or (3) of this paragraph (b); provided,
however, that the provisions contained in such agreement relating to
such encumbrance or restriction are no more restrictive (as so
determined) in any material respect than the provisions contained in
the agreement governing the Debt being refinanced;
(5) in the case of clause (3) of paragraph (a) above, any
encumbrance or restriction contained in any security agreement
(including a Capital Lease Obligation) securing Debt of the Company or
a Restricted Subsidiary otherwise permitted under the Indenture, but
only to the extent such restrictions restrict the transfer of the
Property subject to such security agreement;
(6) in the case of clause (3) of paragraph (a) above,
customary provisions
80
<PAGE> 86
o that restrict the subletting, assignment or transfer
of any Property that is the subject of a lease,
license, conveyance or similar contract,
o contained in asset sale or other asset disposition
agreements limiting the transfer of the Property
being sold or disposed of pending the closing of such
sale or disposition, or
o arising or agreed to in the ordinary course of
business, not relating to any Debt, and that do not,
individually or in the aggregate, detract from the
value of Property of the Company or any Restricted
Subsidiary in any manner material to the Company or
any Restricted Subsidiary,
(7) any encumbrance or restriction with respect to a
Restricted Subsidiary imposed pursuant to an agreement which has been
entered into for the sale or disposition of all or substantially all of
the Capital Stock or Property of such Restricted Subsidiary, provided
that the consummation of such transaction would not result in a Default
or an Event of Default, that such restriction terminates if such
transaction is abandoned and that the consummation or abandonment of
such transaction occurs within one year of the date such agreement was
entered into;
(8) any encumbrance or restriction pursuant to the Indenture
and the Notes (or encumbrances or restrictions that are substantially
similar taken as a whole); and
(9) Permitted Liens.
SECTION 3.13. Limitation on Liens. The Company may not, and may not
permit any Restricted Subsidiary to, directly or indirectly, Incur or suffer to
exist any Lien on or with respect to any Property now owned or acquired after
the date of the Indenture to secure any Debt without making, or causing such
Restricted Subsidiary to make, effective provision for securing the Notes
o equally and ratably with such Debt as to such Property for so long
as such Debt will be so secured, or
o in the event such Debt is Debt of the Company or a Guarantor which
is subordinate in right of payment to the Notes or the applicable
Domestic Restricted Subsidiary Guarantee, prior to such Debt as to
such Property for so long as such Debt will be so secured.
81
<PAGE> 87
These restrictions shall not apply to:
(1) Liens existing on the date of the Indenture;
(2) Liens Incurred on or after the date of the Indenture
pursuant to any Credit Facility to secure Debt permitted to be Incurred
pursuant to clause (2) of paragraph (b) of Section 3.08;
(3) Liens securing Debt in an amount which, together with the
aggregate amount of Debt then outstanding or available under all Credit
Facilities (together with all refinancing Debt then outstanding or
available pursuant to clause (8) of paragraph (b) of Section 3.08 in
respect of Debt previously Incurred under Credit Facilities), does not
exceed 1.5 times the Company's Consolidated Cash Flow Available for
Fixed Charges for the four full fiscal quarters preceding the
Incurrence of such Lien for which the Company's consolidated financial
statements are available, determined on a pro forma basis as if such
Debt had been Incurred and the proceeds thereof had been applied at the
beginning of such four fiscal quarters;
(4) Liens in favor of the Company or any Restricted
Subsidiary; provided, however, that any subsequent issue or transfer of
Capital Stock or other event that results in any such Restricted
Subsidiary ceasing to be a Restricted Subsidiary or any subsequent
transfer of the Debt secured by any such Lien, except to the Company or
a Restricted Subsidiary, shall be deemed, in each case, to constitute
the Incurrence of such Lien by the issuer thereof;
(5) Liens to secure Purchase Money Debt permitted to be
Incurred pursuant to clause (3) of paragraph (b) of Section 3.08;
provided that any such Lien may not extend to any Property other than
the Telecommunications Assets installed, constructed, acquired, leased,
developed or improved with the proceeds of such Purchase Money Debt and
any improvements or accessions thereto (it being understood that all
Debt to any single lender or group of related lenders or outstanding
under any single credit facility, and in any case relating to the same
group or collection of Telecommunications Assets financed thereby,
shall be considered a single Purchase Money Debt, whether drawn at one
time or from time to time);
(6) Liens to secure Acquired Debt; provided that
o such Lien attaches to the acquired Property prior to
the time of the acquisition of such Property, and
82
<PAGE> 88
o such Lien does not extend to or cover any other
Property,
(7) Liens to secure Debt permitted to be Incurred pursuant to
clause (13) of paragraph (b) of Section 3.08;
(8) Liens to secure Debt Incurred to refinance, in whole or in
part, Debt secured by any Lien referred to in the foregoing clauses
(1), (2), (5), (6) and (7) or this clause (8) so long as such Lien does
not extend to any other Property (other than improvements and
accessions to the original Property) and the principal amount of Debt
so secured is not increased except as otherwise permitted under clause
(8) of paragraph (b) of Section 3.08 or clause (12) of Section 3.09;
(9) Liens to secure Debt consisting of Permitted Interest Rate
and Currency Protection Agreements permitted to be Incurred pursuant to
clause (10) of paragraph (b) of Section 3.08;
(10) Liens to secure Debt secured by Receivables permitted to
be Incurred pursuant to clause (11) of paragraph (b) of Section 3.08;
(11) Liens granted after the date of the Indenture to secure
the Notes;
(12) Permitted Liens; and
(13) Liens not otherwise permitted by the foregoing clauses
(1) through (12) that, at the time of Incurrence thereof, taken
together with all other Liens Incurred after the date of the Indenture
in reliance on this clause (13) and which remain in existence, secure
Debt in an aggregate principal amount not to exceed 5% of the Company's
Consolidated Tangible Assets as of the most recent balance sheet date
as of which the Company's consolidated balance sheet is available.
SECTION 3.14. Limitation on Sale and Leaseback Transactions. The
Company may not, and may not permit any Restricted Subsidiary to, directly or
indirectly, enter into, assume, Guarantee or otherwise become liable with
respect to any Sale and Leaseback Transaction, unless:
(1) The Company or such Restricted Subsidiary would be
entitled to Incur
83
<PAGE> 89
o Debt in an amount equal to the Attributable Value of
the Sale and Leaseback Transaction pursuant to the
covenant described in Section 3.08, and
o a Lien pursuant to the covenant described in Section
3.13, equal in amount to the Attributable Value of
the Sale and Leaseback Transaction, without also
securing the Notes; and
(2) the Sale and Leaseback Transaction is treated as an Asset
Disposition and all of the conditions described in Section 3.15
(including the provisions concerning the application of Net Available
Proceeds) are satisfied with respect to such Sale and Leaseback
Transaction, treating all of the consideration received in such Sale
and Leaseback Transaction as Net Available Proceeds for purposes of
such covenant.
SECTION 3.15. Limitation on Asset Dispositions. The Company may not,
and may not permit any Restricted Subsidiary to, make any Asset Disposition
unless:
(1) The Company or the Restricted Subsidiary, as the case may
be, receives consideration for such disposition at least equal to the
Fair Market Value for the Property sold or disposed of; and
(2) at least 75% of the consideration for such disposition
consists of cash or Cash Equivalents or the assumption of Debt of the
Company or any Restricted Subsidiary (other than Debt that is
subordinated to the Notes or any Domestic Restricted Subsidiary
Guarantee) and release of the Company and all Restricted Subsidiaries
from all liability on the Debt assumed (or if less than 75%, the
remainder of such consideration consists of Telecommunications Assets).
The Net Available Proceeds or any portion thereof from Asset
Dispositions may be applied by the Company or a Restricted Subsidiary, to the
extent the Company or such Restricted Subsidiary elects or is required by the
terms of any Debt:
o to the permanent repayment or reduction of Debt then outstanding
under any Credit Facility, to the extent such Credit Facility
would require such application or prohibit payments pursuant to an
Offer to Purchase in accordance with this Section 3.15 (other than
Debt owed to the Company or any Affiliate of the Company); or
84
<PAGE> 90
o to reinvest in Telecommunications Assets (including by means of an
Investment in Telecommunications Assets by a Restricted Subsidiary
with Net Available Proceeds received by the Company or another
Restricted Subsidiary).
Any Net Available Proceeds from an Asset Disposition not applied in
accordance with the preceding paragraph within 360 days from the date of the
receipt of such Net Available Proceeds shall constitute "Excess Proceeds." When
the aggregate amount of Excess Proceeds exceeds $10 million, the Company will be
required to make an Offer to Purchase with such Excess Proceeds on a pro rata
basis according to principal amount, or, in the case of Debt issued at a
discount, the then Accreted Value, for
(x) outstanding Notes at a price in cash equal to 100% of the
principal amount of the Notes on the purchase date plus accrued and
unpaid interest, if any, on the Notes, subject to the right of Holders
of record on the relevant record date to receive interest due on the
relevant interest payment date, and
(y) any other Debt of the Company or any Guarantor that ranks
equally with the Notes, or any Debt of a Restricted Subsidiary that is
not a Guarantor, at a price no greater than 100% of the principal
amount thereof plus accrued and unpaid interest, if any, to the
purchase date, or 100% of the then Accreted Value plus accrued and
unpaid interest, if any, to the purchase date in the case of original
issue discount Debt, to the extent, in the case of this clause (y),
required under the terms of such Debt (other than Debt owed to the
Company or any Affiliate of the Company).
To the extent there are any remaining Excess Proceeds following the
completion of the Offer to Purchase, the Company shall apply such Excess
Proceeds to the repayment of other Debt of the Company or any Restricted
Subsidiary, to the extent permitted or required under the terms of such other
Debt. Any other remaining Excess Proceeds may be applied to any use as
determined by the Company which is not otherwise prohibited by the Indenture,
and the amount of Excess Proceeds shall be reset to zero.
SECTION 3.16. Limitation on Issuances and Sales of Capital Stock of
Restricted Subsidiaries. The Company may not, and may not permit any Restricted
Subsidiary to, issue, transfer, convey, sell or otherwise dispose of any shares
of Capital Stock of a Restricted Subsidiary or securities convertible or
exchangeable into, or options, warrants, rights or any other interest with
respect to, Capital Stock of a Restricted Subsidiary to any Person other than
the Company or a Restricted Subsidiary except:
85
<PAGE> 91
(1) a sale of all of the Capital Stock of such Restricted
Subsidiary owned by the Company and any Restricted Subsidiary that
complies with the provisions described in the section above entitled
Section 3.15 to the extent such provisions apply,
(2) in a transaction that results in such Restricted
Subsidiary becoming a Joint Venture; provided
o such transaction complies with the provisions
described in Section 3.15 to the extent such
provisions apply, and
o the remaining interest of the Company or any other
Restricted Subsidiary in such Joint Venture would
have been permitted as a new Restricted Payment or
Permitted Investment under the provisions of Section
3.11;
(3) the issuance, transfer, conveyance, sale or other
disposition of shares of such Restricted Subsidiary so long as after
giving effect to such transaction such Restricted Subsidiary remains a
Restricted Subsidiary and such transaction complies with the provisions
described in Section 3.15 to the extent such provisions apply;
(4) the transfer, conveyance, sale or other disposition of
shares required by applicable law or regulation;
(5) if required, the issuance, transfer, conveyance, sale or
other disposition of directors' qualifying shares;
(6) Disqualified Stock issued in exchange for, or upon
conversion of, or the proceeds of the issuance of which are used to
redeem, replace, refund or refinance, shares of Disqualified Stock of
such Restricted Subsidiary, provided that the amounts of the redemption
obligations of such Disqualified Stock shall not exceed the amounts of
the redemption obligations of, and such Disqualified Stock shall have
redemption obligations no earlier than those required by, the
Disqualified Stock being exchanged, converted, redeemed, replaced,
refunded or refinanced;
(7) in a transaction where the Company or a Restricted
Subsidiary acquires at the same time not less than its Proportionate
Interest in such issuance of Capital Stock;
(8) Capital Stock issued and outstanding on the date of the
Indenture;
86
<PAGE> 92
(9) Capital Stock of a Restricted Subsidiary issued and
outstanding prior to the time that such Person becomes a Restricted
Subsidiary so long as such Capital Stock was not issued in
contemplation of such Person's becoming a Restricted Subsidiary or
otherwise being acquired by the Company; and
(10) an issuance of Preferred Stock of a Restricted Subsidiary
(other than Preferred Stock convertible or exchangeable into Common
Stock of any Restricted Subsidiary) otherwise permitted by the
Indenture.
SECTION 3.17. Limitation on Transactions with Affiliates. The Company
will not, and will not permit any of its Restricted Subsidiaries to, directly or
indirectly, sell, lease, transfer, or otherwise dispose of any of its Property
to, or purchase any Property from, or enter into any contract, agreement,
understanding, loan, advance, Guarantee or transaction, including the rendering
of services, with or for the benefit of, any Affiliate (each of the foregoing,
an "AFFILIATE TRANSACTION"), unless:
(a) such Affiliate Transaction or series of Affiliate
Transactions is in the best interest of the Company or such Restricted
Subsidiary and on terms that are fair and reasonable to, and in the
best interests of, the Company or the Restricted Subsidiary, as the
case may be; and
(b) The Company delivers to the Trustee
o with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate
payments in excess of $10 million but less than $15
million, a certificate of the chief executive, operating
or financial officer of the Company evidencing such
officer's determination that such Affiliate Transaction or
series of Affiliate Transactions complies with clause (a)
above, and
o with respect to any Affiliate Transaction or series of
related Affiliate Transactions involving aggregate
payments equal to or in excess of $15 million, a board
resolution certifying that such Affiliate Transaction or
series of Affiliate Transactions complies with clause (a)
above and that such Affiliate Transaction or series of
Affiliate Transactions has been approved by the Board of
Directors of the Company, including a majority of the
disinterested members of the Board of Directors of the
Company; provided that, if there shall not be at least two
87
<PAGE> 93
disinterested members of the Board of Directors of the
Company with respect to the Affiliate Transaction, the
Company shall, in addition to such board resolution, file
with the Trustee a written opinion from an investment
banking firm of national standing in the United States
which, in the good faith judgment of the Board of
Directors of the Company, is independent with respect to
the Company and its Affiliates and qualified to perform
such task, which opinion shall be to the effect that the
consideration to be paid or received in connection with
such Affiliate Transaction is fair, from a financial point
of view, to the Company or such Restricted Subsidiary.
Despite clauses (a) and (b) above, the following shall not be deemed
Affiliate Transactions:
(1) any employment agreement entered into by the Company or
any of its Restricted Subsidiaries in the ordinary course of business
and consistent with industry practice;
(2) any agreement or arrangement with respect to the
compensation of a director or officer of the Company or any Restricted
Subsidiary approved by a majority of the Board of Directors of the
Company and consistent with industry practice;
(3) transactions between or among the Company and its
Restricted Subsidiaries; provided that no more than 10% of the Voting
Stock, on a fully diluted basis, of any such Restricted Subsidiary is
owned by an Affiliate of the Company (other than a Restricted
Subsidiary);
(4) Restricted Payments and Permitted Investments permitted by
Section 3.11 (other than Investments in Affiliates that are not the
Company or Restricted Subsidiaries);
(5) transactions pursuant to the terms of or performance of
any agreement or arrangement as in effect on the date of the Indenture;
(6) transactions pursuant to and any payments under,
compliance with, or performance of obligations under, the Williams
Intercompany Arrangements;
(7) transactions with respect to wireline or wireless
transmission capacity, the lease or sharing or other use of cable or
fiber-optic lines,
88
<PAGE> 94
equipment, rights of way or other access rights, between the Company,
or any Restricted Subsidiary, and any other Person; provided that, in
the case of this clause (7), such transaction complies with clause (a)
in the immediately preceding paragraph;
(8) loans, advances or extensions of credit to employees,
officers and directors of the Company or any Restricted Subsidiary made
in the ordinary course of business and consistent with past practice or
in connection with employee benefits agreements or arrangements
approved by the Board of Directors of the Company; provided, however,
that if the Company or any Restricted Subsidiary makes loans, advances
or extensions of credit to employees, officers and directors in excess
of $3 million in the aggregate at any one time outstanding, the Board
of Directors of the Company must determine that such loans, advances or
extensions of credit in excess of $3 million are fair and reasonable
to, and in the best interests of, the Company or the Restricted
Subsidiary, as the case may be;
(9) the granting or performance of registration rights under
any written registration rights agreement approved by the Board of
Directors of the Company;
(10) transactions with Persons solely in their capacity as
holders of Debt or Capital Stock of the Company or any of its
Subsidiaries, where such Persons are treated no more favorably than
holders of Debt or Capital Stock of the Company generally;
(11) sales or issuances of Capital Stock, other than
Disqualified Stock, in exchange for cash, securities or Property;
provided that such transactions comply with clause (a) in the
immediately preceding paragraph; and
(12) any agreement to do any of the foregoing.
SECTION 3.18. Repurchase of Notes Upon Change of Control Triggering
Event. Within 30 days of both a Change of Control and a Rating Decline with
respect to the Notes (a "CHANGE OF CONTROL TRIGGERING EVENT"), the Company will
be required to make an Offer to Purchase all outstanding Notes in accordance
with this Section 3.18 at a price in cash equal to 101% of the principal amount
of the Notes on the purchase date plus accrued and unpaid interest, if any, to
such purchase date, subject to the right of Holders of record on the relevant
record date to receive interest due on the relevant interest payment date.
89
<PAGE> 95
A "CHANGE OF CONTROL" means the occurrence of any of the following
events:
(A) if any "person" or "group" (as such terms are used in
Section 13(d) and Section 14(d) of the Exchange Act or any successor
provisions to either of the foregoing), including any group acting for
the purpose of acquiring, holding, voting or disposing of securities
within the meaning of Rule l3d-5 (b) (1) under the Exchange Act, other
than any one or more of the Permitted Holders, becomes the "BENEFICIAL
OWNER" (as defined in Rule l3d-3 under the Exchange Act, except that a
person will be deemed to have "beneficial ownership" of all shares that
any such person has the right to acquire, whether such right is
exercisable immediately or only after the passage of time), directly or
indirectly, of 35% or more of the total voting power of the Voting
Stock of the Company at a time when the Permitted Holders are the
"beneficial owners" (as defined in Rule l3d-3 under the Exchange Act,
except that a person will be deemed to have "beneficial ownership" of
all shares that any such person has the right to acquire, whether such
right is exercisable immediately or only after the passage of time),
directly or indirectly, in the aggregate of a lesser percentage of the
total voting power of the Voting Stock of the Company than such other
person or group (for purposes of this clause (A), such person or group
shall be deemed to beneficially own any Voting Stock of a corporation
held by any other corporation so long as such person or group
beneficially owns, directly or indirectly, in the aggregate a majority
of the total voting power of the Voting Stock of such other
corporation); or
(B) the sale, transfer, assignment, lease, conveyance or other
disposition, directly or indirectly, of all or substantially all the
assets of the Company and the Restricted Subsidiaries, considered as a
whole (other than a disposition of such assets as an entirety or
virtually as an entirety to one or more Permitted Holders) shall have
occurred; or
(C) during any period of two consecutive years, individuals
who at the beginning of such period constituted the Board of Directors
of the Company (together with any new directors whose election or
appointment by such board or whose nomination for election by the
shareholders of the Company was approved by a vote of a majority of the
directors then still in office who were either directors at the
beginning of such period or whose election or nomination for election
was previously so approved) cease for any reason to constitute a
majority of the Board of Directors of the Company then in office; or
90
<PAGE> 96
(D) the shareholders of the Company shall have approved any
plan of liquidation or dissolution of the Company.
If the Company makes an Offer to Purchase the Notes in accordance with
this Section 3.18, the Company intends to comply with any applicable securities
laws and regulations, including any applicable requirements of Section 14(e) of,
and Rule l4e-1 under, the Exchange Act. To the extent that the provisions of any
applicable securities laws or regulations conflict with the provisions relating
to the Offer to Purchase, the Company will comply with the applicable securities
laws and regulations and will not be deemed to have breached its obligations
described above by virtue thereof.
SECTION 3.19. Reports. Whether or not the Company is subject to Section
13(a) or 15(d) of the Exchange Act, or any successor provision thereto, the
Company shall file with the Commission, unless the Commission will not accept
such filing, the annual reports, quarterly reports and other documents which the
Company would have been required to file with the Commission pursuant to such
Section 13(a) or 15(d) or any successor provision thereto if the Company were
subject to such successor provision, such documents to be filed with the
Commission on or prior to the respective dates by which the Company would have
been required to file them.
The Company shall also in any event:
(a) within 15 days of each required filing date;
o transmit by mail to all Holders, as their names and
addresses appear in the security register, without
cost to such Holders; and
o file with the Trustee copies of the annual reports,
quarterly reports and other documents, without
exhibits, which the Company would have been required
to file with the Commission pursuant to Section 13(a)
or 15(d) of the Exchange Act or any successor
provisions thereto if the Company were subject to
such successor provisions; and
(b) if filing such documents by the Company with the Commission is not
permitted under the Exchange Act, promptly upon written request, supply copies
of such documents, without exhibits, to any prospective Holder.
Delivery of such reports, information and documents to the Trustee is
for informational purposes only and the Trustee's receipt of such shall not
constitute
91
<PAGE> 97
constructive notice of any information contained therein or determinable from
information contained therein, including the Company's compliance with any of
its covenants hereunder (as to which the Trustee is entitled to rely exclusively
on Officers' Certificates).
SECTION 3.20. Limitation on Designations of Unrestricted Subsidiaries.
The Company will not designate any Subsidiary of the Company, other than a newly
created Subsidiary in which no Investment has previously been made, as an
"Unrestricted Subsidiary" under the Indenture (a "DESIGNATION") unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of or after giving effect to such Designation;
(b) immediately after giving effect to such Designation, the
Company would be able to Incur $1.00 of Debt under paragraph (a) of
Section 3.08; and
(c) The Company would not be prohibited under the Indenture
from making an Investment at the time of Designation (assuming the
effectiveness of such Designation) in an amount (the "DESIGNATION
AMOUNT") equal to the portion (proportionate to the Company's equity
interest in such Restricted Subsidiary) of the Fair Market Value of the
net assets of such Restricted Subsidiary on such date.
In the event of any such Designation, the Company shall be deemed to
have made an Investment in the Designation Amount constituting a Restricted
Payment pursuant to Section 3.11 for all purposes of the Indenture; provided,
however, that, upon a Revocation of any such Designation of a Subsidiary, the
Company shall be deemed to continue to have a permanent Investment in an
Unrestricted Subsidiary of an amount (if positive) equal to (1) the Company's
Investment in such Subsidiary at the time of such Revocation less (2) the
portion (proportionate to the Company's equity interest in such Subsidiary) of
the Fair Market Value of the net assets of such Subsidiary at the time of such
Revocation less (3) any Returned Investment. At the time of any Designation of
any Subsidiary as an Unrestricted Subsidiary, such Subsidiary shall not own any
Capital Stock of the Company or any Restricted Subsidiary.
Neither the Company nor any Restricted Subsidiary shall at any time (x)
provide credit support for, or a Guarantee of, any Debt of any Unrestricted
Subsidiary (including any undertaking, agreement or instrument evidencing such
Debt); provided that the Company or a Restricted Subsidiary may pledge Capital
Stock or Debt of any Unrestricted Subsidiary on a nonrecourse basis such that
the pledgee has no claim whatsoever against the Company other than to obtain
such
92
<PAGE> 98
pledged Capital Stock or Debt, (y) be directly or indirectly liable for any Debt
of any Unrestricted Subsidiary or (z) be directly or indirectly liable for any
Debt which provides that the holder of such Debt may (upon notice, lapse of time
or both) declare a default thereon or cause the payment thereof to be
accelerated or payable prior to its final scheduled maturity upon the occurrence
of a default with respect to any Debt, Lien or other obligation of any
Unrestricted Subsidiary (including any right to take enforcement action against
such Unrestricted Subsidiary), except in the case of clause (x) or (y) to the
extent permitted under Section 3.11 and Section 3.17.
Unless Designated as an Unrestricted Subsidiary, any Person that
becomes a Subsidiary of the Company will be classified as a Restricted
Subsidiary; provided, however, that such Subsidiary shall not be designated as a
Restricted Subsidiary and shall be automatically classified as an Unrestricted
Subsidiary if either of the requirements set forth in clauses (a) and (b) of the
immediately following paragraph will not be satisfied immediately following such
classification. Except as provided in the first sentence of this Section, no
Restricted Subsidiary may be redesignated as an Unrestricted Subsidiary.
A Designation may be revoked (a "REVOCATION") by a resolution of the
Board of Directors of the Company; provided that the Company will not make any
Revocation unless:
(a) no Default or Event of Default shall have occurred and be
continuing at the time of and after giving effect to such Revocation;
and
(b) all Liens and Debt of such Unrestricted Subsidiary
outstanding immediately following such Revocation would, if Incurred at
such time, have been permitted to be Incurred at such time for all
purposes of the Indenture.
All Designations and Revocations must be evidenced by resolutions of
the Board of Directors of the Company
o certifying compliance with the foregoing provisions,
o giving the effective date of such Designation or Revocation, and
o delivered to the Trustee within 45 days after the end of the
fiscal quarter of the Company in which such Designation or
Revocation is made (or, in the case of a Designation or Revocation
made during the last fiscal quarter of the Company's fiscal year,
within 90 days after the end of such fiscal year).
93
<PAGE> 99
SECTION 3.21. Existence. Subject to Articles Three and Eight of this
Indenture, the Company will do or cause to be done all things necessary to
preserve and keep in full force and effect its existence and the existence of
each of its Restricted Subsidiaries in accordance with the respective
organizational documents of the Company and each such Restricted Subsidiary and
the rights (whether pursuant to charter, partnership certificate, agreement,
statute or otherwise), material licenses and franchises of the Company and each
such Restricted Subsidiary, provided that the Company shall not be required to
preserve any such right, license or franchise, or the existence of any
Restricted Subsidiary, if the maintenance or preservation thereof is no longer
desirable in the conduct of the business of the Company and its Restricted
Subsidiaries taken as a whole.
SECTION 3.22. Payment of Taxes and Other Claims. The Company will pay
or discharge and shall cause each of its Restricted Subsidiaries to pay or
discharge, or cause to be paid or discharged, before the same shall become
delinquent (a) all material taxes, assessments and governmental charges levied
or imposed upon (i) the Company or any such Restricted Subsidiary, (ii) the
income or profits of any such Restricted Subsidiary which is a corporation or
(iii) the property of the Company or any such Restricted Subsidiary and (b) all
material lawful claims for labor materials and supplies that, if unpaid, might
by law become a lien upon the property of the Company or any such Restricted
Subsidiary; provided that the Company shall not be required to pay of discharge,
or cause to be paid or discharged, any such tax, assessment, charge or claim the
amount, applicability or validity of which is being contested in good faith by
appropriate proceedings and for which adequate reserves have been established.
SECTION 3.23. Maintenance of Properties and Insurance. The Company will
cause all properties used or useful in the conduct of its business or the
business of any of its Restricted Subsidiaries, to be maintained and kept in
good condition, repair and working order and supplied with all necessary
equipment and will cause to be made all necessary repairs, renewals,
replacements, betterments and improvements thereof, all as in the judgment of
the Company may be necessary so that the business carried on in connection
therewith may be properly and advantageously conducted at all times; provided
that nothing in this Section shall prevent the Company or any such Restricted
Subsidiary from discontinuing the use, operation or maintenance of any of such
properties or disposing of any of them, if such discontinuance or disposal is,
in the judgment of the Company, desirable in the conduct of the business of the
Company or such Restricted Subsidiary.
The Company will provide or cause to be provided, for itself and its
Restricted Subsidiaries, insurance (including appropriate self-insurance)
against loss or damage of the kinds customarily insured against by corporations
similarly
94
<PAGE> 100
situated and owning like properties, including, but not limited to, products
liability insurance and public liability insurance, with reputable insurers or
with the government of the United States of America, or an agency or
instrumentality thereof, in such amounts, with such deductibles and by such
methods as shall be customary for corporations similarly situated in the
industry in which the Company or such Restricted Subsidiary, as the case may be,
is then conducting business.
SECTION 3.24. Waiver of Stay, Extension or Usury Laws. The Company
covenants (to the extent that it may lawfully do so) that it will not (1) at any
time insist upon, or plead, or in any manner whatsoever claim or take the
benefit or advantage of, any stay or extension law or any usury law or other law
that would prohibit or forgive the Company from paying all or any portion of the
principal of or interest on the Notes as contemplated herein, wherever enacted,
now or at any time hereafter in force, or which may affect the covenants or the
performance of this Indenture and the Company will expressly waive all benefit
or advantage of any such law and (2) hinder, delay or impede the execution of
any power granted to the Trustee under this Indenture and will suffer and permit
the execution of every such power as though no such law had been enacted.
ARTICLE 4
REMEDIES OF THE TRUSTEE AND HOLDERS ON EVENT OF DEFAULT
SECTION 4.01. Events of Default. Each of the following constitutes an
"EVENT OF DEFAULT":
(a) default in the payment of principal of, or premium, if
any, on, any Note when the same becomes due and payable, upon
acceleration, redemption or otherwise;
(b) default in the payment of interest (including any
Additional Interest) on any Note when the same becomes due and payable,
and such default continues for a period of 30 days;
(c) default in the payment of principal of and interest on
Notes required to be purchased pursuant to an Offer to Purchase under
Section 3.18;
(d) failure to comply with the requirements of Article Eight;
(e) the Company or any Guarantor defaults in the performance
of or breaches any other covenant or agreement in the Indenture or
under the
95
<PAGE> 101
Notes (other than (a), (b) or (c) above) and such default or breach
continues for a period of 60 consecutive days after written notice by
the Trustee or the Holders of 25% or more in aggregate principal amount
of the outstanding 2008 Notes or 2010 Notes;
(f) there occurs a default under the terms of any instrument
evidencing or securing Debt of the Company or any Restricted Subsidiary
having an outstanding principal amount of $25 million or its foreign
currency equivalent at the time, individually or in the aggregate,
which default results in the acceleration of the payment of such
indebtedness or constitutes the failure to pay such indebtedness when
due (after expiration of any applicable grace period);
(g) the rendering of a final judgment or judgments, not
subject to appeal or covered by insurance, against the Company or any
Restricted Subsidiary in an aggregate amount in excess of $25 million
or its foreign currency equivalent at the time, and which shall not
have been waived, satisfied or discharged for a period of 45
consecutive days after the date on which the right to appeal has
expired;
(h) any Domestic Restricted Subsidiary Guarantee ceases to be
in full force and effect, other than in accordance with the terms of
such Domestic Restricted Subsidiary Guarantee, or any Guarantor denies
or disaffirms its obligations under its Domestic Restricted Subsidiary
Guarantee;
(i) a court having jurisdiction in the premises enters a
decree or order for (A) relief in respect of the Company or any of its
Significant Subsidiaries in an involuntary case under any applicable
bankruptcy, insolvency or other similar law now or hereafter in effect,
(B) appointment of a receiver, liquidator, assignee, custodian,
trustee, sequestrator or similar official of the Company or any of its
Significant Subsidiaries or for all or substantially all of the
property and assets of the Company or any of its Significant
Subsidiaries or (C) the winding up or liquidation of the affairs of the
Company or any of its Significant Subsidiaries and, in each case, such
decree or order shall remain unstayed and in effect for a period of 60
consecutive days; or
(j) the Company or any of its Significant Subsidiaries (A)
commences a voluntary case under any applicable bankruptcy, insolvency
or other similar law now or hereafter in effect, or consents to the
entry of an order for relief in an involuntary case under any such law,
(B) consents to the appointment of or taking possession by a receiver,
liquidator,
96
<PAGE> 102
assignee, custodian, trustee, sequestrator or similar official of the
Company or any of its Significant Subsidiaries or for all or
substantially all of the property and assets of the Company or any of
its Significant Subsidiaries or (C) effects any general assignment for
the benefit of creditors.
SECTION 4.02. Acceleration. If any Event of Default (other than an
Event of Default described in clause (i) or (j) of Section 4.01) shall occur and
be continuing under the Indenture with respect to the 2008 Notes or the 2010
Notes, either the Trustee or the Holders of at least 25% in aggregate principal
amount of the 2008 Notes or 2010 Notes, as applicable, then outstanding, by
written notice to the Company (and to the Trustee if such notice is given by the
Holders (the "ACCELERATION NOTICE")), may, and the Trustee at the request of
such Holders shall, declare the principal of, premium, if any, and accrued
interest on the 2008 Notes or 2010 Notes, as the case may be, to be immediately
due and payable. Upon a declaration of acceleration, such principal of, premium,
if any, and accrued interest shall be immediately due and payable. In the event
of a declaration of acceleration because an Event of Default set forth in clause
(e) of Section 4.01 has occurred and is continuing, such declaration of
acceleration shall be automatically rescinded and annulled if the event of
default triggering such Event of Default pursuant to clause (e) of Section 4.01
shall be remedied or cured by the Company or the relevant Domestic Restricted
Subsidiary or waived by the holders of the relevant Debt within 60 days after
the declaration of acceleration with respect thereto; provided, however, that an
Event of Default arising under clause (e) of Section 4.01 by reason of the
Company's failure to timely deliver to the Trustee notice of a Default or an
Event of Default pursuant to clause (b) of Section 3.05 shall be deemed to be
cured if such Default or Event of Default is cured. If an Event of Default
specified in clause (i) or (j) of Section 4.01 occurs with respect to the
Company, the principal of, premium, if any, and accrued interest on all the
Notes then outstanding shall ipso facto become and be immediately due and
payable without any declaration or other act on the part of the Trustee or any
Holder.
SECTION 4.03. Other Remedies. If an Event of Default occurs and is
continuing, the Trustee may pursue any available remedy to collect the payment
of principal or interest on the Notes or to enforce the performance of any
provision of the Notes or this Indenture.
The Trustee may maintain a proceeding even if it does not possess any
of the Notes or does not produce any of them in the proceeding. A delay or
omission by the Trustee or any Holder in exercising any right or remedy accruing
upon an Event of Default shall not impair the right or remedy or constitute a
waiver of or acquiescence in the Event of Default. All remedies are cumulative
to the extent permitted by law.
97
<PAGE> 103
SECTION 4.04. Waiver of Past Defaults. The Holders of at least a
majority in principal amount of the outstanding 2008 Notes or 2010 Notes, as the
case may be, by written notice to the Company and to the Trustee, may waive all
past defaults and rescind and annul a declaration of acceleration and its
consequences if (1) all existing Events of Default (other than (x) the
nonpayment of the principal of, premium, if any, and interest on the Notes that
have become due solely by such declaration of acceleration or (y) with respect
to a covenant or provision of this Indenture which under Section 7.02 cannot be
modified or amended without the consent of the Holders of each outstanding Note
affected thereby) have been cured or waived and (2) the rescission would not
conflict with any judgment or decree of a court of competent jurisdiction. Upon
any such waiver, such Default shall cease to exist, and any Event of Default
arising therefrom shall be deemed to have been cured for every purpose of this
Indenture; but no such waiver shall extend to any subsequent or other Default or
impair any right consequent thereon.
SECTION 4.05. Control by Majority. The Holders of at least a majority
in aggregate principal amount of the outstanding Notes of each series may direct
the time, method and place of conducting any proceeding for any remedy available
to the Trustee or exercising any trust or power conferred on the Trustee.
However, the Trustee may refuse to follow any direction that conflicts with law
or the Indenture, that may involve the Trustee in personal liability, or that
the Trustee determines in good faith may be unduly prejudicial to the rights of
Holders of Notes not joining in the giving of such direction and may take any
other action it deems proper that is not inconsistent with any such direction
received from Holders of Notes.
SECTION 4.06. Limitation on Suits. A Holder may not pursue any remedy
with respect to the Indenture or the Notes unless:
(i) the Holder gives the Trustee written notice of a
continuing Event of Default;
(ii) the Holders of at least 25% in aggregate principal amount
of outstanding applicable series of Notes make a written request to the
Trustee to pursue the remedy;
(iii) such Holder or Holders offer the Trustee indemnity
satisfactory to the Trustee against any costs, liability or expense;
(iv) the Trustee does not comply with the request within 60
days after receipt of the request and the offer of indemnity; and
98
<PAGE> 104
(v) during such 60-day period, the Holders of at least a
majority in aggregate principal amount of the outstanding applicable
series of Notes do not give the Trustee a direction that is
inconsistent with the request.
SECTION 4.07. Rights of Holders to Receive Payment. Notwithstanding any
other provision of this Indenture, the right of any Holder to receive payment of
principal, premium, if any, 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 the Holder.
SECTION 4.08. Collection Suit by Trustee. If an Event of Default
specified in Section 4.01(a) or (b) hereof occurs and is continuing, the Trustee
is authorized to recover judgment in its own name and as trustee of an express
trust against the Company or any other obligor for the whole amount of
principal, premium, if any, 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 amounts due the Trustee under
Section 5.07 hereof, including the costs and expenses of collection, including
the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel.
SECTION 4.09. 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 allowed in any judicial
proceedings relative to the Company (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 5.07 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 5.07 hereof out of the estate in any such proceeding,
shall be denied for any reason, payment of the same shall be secured by a Lien
on, and shall be paid out of, any and all distributions, dividends, money,
securities and other properties which the Holders 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
99
<PAGE> 105
consent to or accept or adopt on behalf of any Holder any plan of
reorganization, arrangement, adjustment or composition affecting the Notes or
the rights of any Holder thereof, or to authorize the Trustee to vote in respect
of the claim of any Holder in any such proceeding.
SECTION 4.10. Priorities. If the Trustee collects any money pursuant to
this Article, it shall pay out the money in the following order:
First: to the Trustee, its agents and attorneys for amounts due under
Section 5.07, including payment of all compensation, expense and liabilities
incurred, and all advances made, by the Trustee and the costs and expenses of
collection;
Second: to Holders for amounts due and unpaid on the Notes for
principal, premium, if any, and interest, ratably, without preference or
priority of any kind, according to the amounts due and payable on the Notes for
principal, premium, if any and interest, respectively; and
Third: to the Company 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 upon five Business Days prior notice to the
Company.
SECTION 4.11. Undertaking for Costs. In any suit for the enforcement of
any right or remedy under this Indenture or in any suit against the Trustee for
any action taken or omitted by it as a Trustee, a court in its discretion may
require the filing by any party litigant in the suit of an undertaking to pay
the costs of the suit, and the court in its discretion may assess reasonable
costs, including reasonable attorneys' fees 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 does not apply to a
suit by the Trustee, a suit by a Holder pursuant to Section 4.06 hereof, or a
suit by Holders of more than 10% in aggregate principal amount of the then
outstanding Notes.
100
<PAGE> 106
ARTICLE 5
CONCERNING THE TRUSTEE
SECTION 5.01. Duties and Responsibilities of the Trustee; During
Default; Prior to Default. The Trustee, prior to the occurrence of a Default and
after the curing or waiving of any Default which may have occurred, undertakes
to perform such duties and only such duties as are specifically set forth in
this Indenture. In case an Event of Default has occurred (which has not been
cured or waived) 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 their
exercise, as a prudent person would exercise under the circumstances in the
conduct of such person's own affairs.
No provision of this Indenture shall be construed to relieve the
Trustee from liability for its own negligent action, its own negligent failure
to act or its own wilful misconduct, except that
(a) prior to the occurrence of an Event of Default of which the Trustee
has actual notice and after the curing or waiving of all such Events of Default
which may have occurred:
(i) the duties and obligations of the Trustee shall be
determined solely by the express provisions of this Indenture, and the
Trustee shall not be liable except for the performance of such duties
and obligations as are specifically set forth in this Indenture, and no
implied covenants or obligations shall be read into this Indenture
against the Trustee; and
(ii) in the absence of bad faith on the part of the Trustee,
the Trustee may conclusively rely, as to the truth of the statements
and the correctness of the opinions expressed therein, upon any
statements, certificates or opinions furnished to the Trustee and
conforming to the requirements of this Indenture; but in the case of
any such statements, certificates or opinions which by any provision
hereof are specifically required to be furnished to the Trustee, the
Trustee shall be under a duty to examine the same to determine whether
or not they conform to the requirements of this Indenture (but need not
confirm or investigate the accuracy of the facts stated therein);
(b) the Trustee shall not be liable for any error of judgment made in
good faith by a Responsible Officer or Responsible Officers of the Trustee,
unless it shall be proved that the Trustee was negligent in ascertaining the
pertinent facts; and
101
<PAGE> 107
(c) the Trustee shall not be liable with respect to any action taken or
omitted to be taken by it in good faith in accordance with the direction of the
Holders of not less than a majority in principal amount of the Notes at the time
outstanding relating to the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred upon the Trustee, under this Indenture.
No provision of this Indenture shall require the Trustee to expend or
risk its own funds or otherwise incur any financial liability in the performance
of any of its duties hereunder, or in the exercise of any of its rights or
powers, if it shall have reasonable grounds for believing that repayment of such
funds or adequate indemnity against such risk or liability is not reasonably
assured to it.
This Section is in furtherance of and subject to Section 315 and
Section 316 of the Trust Indenture Act of 1939.
SECTION 5.02. Certain Rights of the Trustee. In furtherance of and
subject to the Trust Indenture Act of 1939, and subject to Section 5.01:
(a) the Trustee may conclusively rely and shall be protected in acting
or refraining from acting upon any resolution, Officers' Certificate or any
other certificate, statement, instrument, opinion, report, notice, request,
consent, order, bond, debenture, note, coupon, security or other paper or
document believed by it to be genuine and to have been signed or presented by
the proper party or parties;
(b) any request, direction, order or demand of the Company mentioned
herein shall be sufficiently evidenced by an Officers' Certificate (unless other
evidence in respect thereof be herein specifically prescribed); and any
resolution of the Board of Directors may be evidenced to the Trustee by a copy
thereof certified by the secretary or an assistant secretary of the Company;
(c) the Trustee may consult with counsel of its selection and any
advice or Opinion of Counsel shall be full and complete authorization and
protection in respect of any action taken, suffered or omitted to be taken by it
hereunder in good faith and in accordance with such advice or Opinion of
Counsel;
(d) the Trustee shall not be liable for any action taken or omitted by
it in good faith and believed by it to be authorized or within the discretion,
rights or powers conferred upon it by this Indenture;
(e) prior to the occurrence of a Default hereunder, of which the
Trustee has actual notice, and after the curing or waiving of all Defaults, the
Trustee shall not be bound to make any investigation into the facts or matters
stated in any
102
<PAGE> 108
resolution, certificate, statement, instrument, opinion, report, notice,
request, consent, order, approval, appraisal, bond, debenture, note, coupon,
security, or other paper or document unless requested in writing so to do by the
Holders of not less than a majority in aggregate principal amount of the Notes
then outstanding; provided that, if the payment within a reasonable time to the
Trustee of the costs, expenses or liabilities likely to be incurred by it in the
making of such investigation is, in the reasonable opinion of the Trustee, not
reasonably assured to the Trustee by the security afforded to it by the terms of
this Indenture, the Trustee may require indemnity satisfactory to it against
such expenses or liabilities as a condition to proceeding; the reasonable
expenses of every such examination shall be paid by the Company or, if paid by
the Trustee or any predecessor trustee, shall be repaid promptly by the Company
upon demand;
(f) 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 which is in fact such a
default is received by the Trustee at the Corporate Trust Office of the Trustee,
and such notice references the Notes and this Indenture;
(g) the Trustee may execute any of the trusts or powers hereunder or
perform any duties hereunder either directly or by or through agents or
attorneys and the Trustee shall not be responsible for any misconduct or
negligence on the part of any agent or attorney appointed with due care by it
hereunder; and
(h) the rights, privileges, protections, immunities and benefits given
to the Trustee, including, without limitation, its rights to be indemnified, are
extended to, and shall be enforceable by, the Trustee in each of its capacities
hereunder, and to each agent, custodian and other Person employed to act
hereunder.
SECTION 5.03. Trustee Not Responsible for Recitals, Disposition of
Notes or Application of Proceeds Thereof. The recitals contained herein and in
the Notes, except the Trustee's certificates of authentication, shall be taken
as the statements of the Company, and the Trustee assumes no responsibility for
the correctness of the same. The Trustee makes no representation as to the
validity or sufficiency of this Indenture or of the Notes. The Trustee shall not
be accountable for the use or application by the Company of any of the Notes or
of the proceeds thereof.
SECTION 5.04. Trustee and Agents May Hold Notes; Collections, etc. The
Trustee or any agent of the Company or the Trustee, in its individual or any
other capacity, may become the owner or pledgee of Notes with the same rights it
would have if it were not the Trustee or such agent and may otherwise deal with
103
<PAGE> 109
the Company and receive, collect, hold and retain collections from the Company
with the same rights it would have if it were not the Trustee or such agent.
However, subject to Section 5.13 hereof, the Trustee will comply with Section
310(b) and Section 311 of the Trust Indenture Act of 1939.
SECTION 5.05. Moneys Held by Trustee. Subject to the provisions of
Section 10.06 hereof, all moneys received by the Trustee shall, until used or
applied as herein provided, be held in trust for the purposes for which they
were received, but need not be segregated from other funds except to the extent
required by mandatory provisions of law. Neither the Trustee nor any agent of
the Company or the Trustee shall be under any liability for interest on any
moneys received by it hereunder.
SECTION 5.06. Notice of Default. If any Default or any Event of Default
occurs and is continuing and if such Default or Event of Default is actually
known to a Responsible Officer of the Trustee, the Trustee shall mail to each
Holder in the manner and to the extent provided in Trust Indenture Act of 1939
Section 313(c) notice of the Default or Event of Default within 90 days after it
occurs, unless such Default or Event of Default has been cured; provided,
however, that, except in the case of a default in the payment of the principal
of, premium, if any, or interest on any Note, the Trustee shall be protected in
withholding such notice if and so long as the board of directors, the executive
committee or a trust committee of directors and/or Responsible Officers of the
Trustee in good faith determine that the withholding of such notice is in the
interest of the Holders.
SECTION 5.07. Compensation and Indemnification of Trustee and Its Prior
Claim. The Company covenants and agrees to pay to the Trustee from time to time,
and the Trustee shall be entitled to, such compensation as shall be agreed in
writing between the Company and the Trustee (which shall not be limited by any
provision of law in regard to the compensation of a trustee of an express trust)
and the Company covenants and agrees to pay or reimburse the Trustee and each
predecessor Trustee upon its request for all reasonable expenses, disbursements
and advances incurred or made by or on behalf of it in accordance with any of
the provisions of this Indenture (including the reasonable compensation and the
expenses and disbursements of its counsel and of all agents and other persons
not regularly in its employ) except any such expense, disbursement or advance as
may arise from its negligence or bad faith. The Company agrees to indemnify each
of the Trustee or any predecessor Trustee and their employees, directors and
officers for, and to hold them harmless against, any and all loss, damage,
claims, liability or expense, including taxes (other than taxes based upon,
measured by or determined by the income of the Trustee), arising out of or in
connection with the acceptance or administration of the trust or trusts
hereunder, including the costs and expenses of defending itself against any
claim (whether asserted by the Company, or any
104
<PAGE> 110
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 that
such loss, damage, claim, liability or expense is due to its own negligence or
bad faith. The obligations of the Company under this Section to compensate and
indemnify the Trustee and each predecessor Trustee and to pay or reimburse the
Trustee and each predecessor Trustee for expenses, disbursements and advances
shall constitute additional indebtedness hereunder and shall survive the
satisfaction and discharge of this Indenture. Such additional indebtedness shall
be a senior lien to that of the Notes upon all property and funds held or
collected by the Trustee as such, except funds held in trust for the benefit of
the Holders of particular Notes, and the Notes are hereby subordinated to such
senior claim.
When the Trustee incurs expenses or renders services in connection with
an Event of Default specified in Section 4.01(i) or Section 4.01(j), the
expenses (including the reasonable charges and expenses of its counsel) and the
compensation for the services are intended to constitute expenses of
administration under any applicable Federal or state bankruptcy, insolvency or
other similar law.
SECTION 5.08. Right of Trustee to Rely on Officers' Certificate, etc.
Subject to Section 5.01 and Section 5.02, whenever in the administration of the
trusts of this Indenture the Trustee shall deem it necessary or desirable that a
matter be proved or established prior to taking or suffering or omitting any
action hereunder, such matter (unless other evidence in respect thereof be
herein specifically prescribed) may, in the absence of negligence or bad faith
on the part of the Trustee, be deemed to be conclusively proved and established
by an Officers' Certificate delivered to the Trustee, and such certificate, in
the absence of negligence or bad faith on the part of the Trustee, shall be full
warrant to the Trustee for any action taken, suffered or omitted by it under the
provisions of this Indenture upon the faith thereof.
SECTION 5.09. Persons Eligible for Appointment as Trustee. The Trustee
hereunder shall at all times be a corporation having a combined capital and
surplus of at least $50,000,000, and which is eligible in accordance with the
provisions of Section 310(a) of the Trust Indenture Act of 1939. If such
corporation publishes reports of condition at least annually, pursuant to law or
to the requirements of a Federal, State or District of Columbia supervising or
examining authority, then for the purposes of this Section, the combined capital
and surplus of such corporation shall be deemed to be its combined capital and
surplus as set forth in its most recent report of condition so published.
SECTION 5.10. Resignation and Removal; Appointment of Successor
Trustee. (a) The Trustee may at any time resign by giving written notice of
resignation to the Company. Upon receiving such notice of resignation, the
105
<PAGE> 111
Company shall promptly appoint a successor trustee by written instrument in
duplicate, executed by authority of the Board of Directors, one copy of which
instrument shall be delivered to the resigning trustee and one copy to the
successor trustee. If no successor trustee shall have been so appointed and have
accepted appointment within 30 days after the mailing of such notice of
resignation, the resigning trustee may petition, at the expense of the Company,
any court of competent jurisdiction for the appointment of a successor trustee,
or any Noteholder who has been a bona fide Holder of a Note or Notes for at
least six months may, on behalf of himself and all others similarly situated,
petition any such court for the appointment of a successor trustee. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.
(b) In case at any time any of the following shall occur:
(i) the Trustee shall fail to comply with the provisions of
Section 310(b) of the Trust Indenture Act of 1939, after written
request therefor by the Company or by any Noteholder who has been a
bona fide Holder of a Note or Notes for at least six months; or
(ii) the Trustee shall cease to be eligible in accordance with
the provisions of Section 5.09 and shall fail to resign after written
request therefor by the Company or by any such Noteholder; or
(iii) the Trustee shall become incapable of acting, or shall
be adjudged a bankrupt or insolvent, or a receiver or liquidator of the
Trustee or of its property shall be appointed, or any public officer
shall take charge or control of the Trustee or of its property or
affairs for the purpose of rehabilitation, conservation or liquidation;
then, in any such case, the Company may remove the Trustee and appoint a
successor trustee by written instrument, in duplicate, executed by order of the
Board of Directors of the Company, one copy of which instrument shall be
delivered to the Trustee so removed and one copy to the successor trustee, or,
subject to Section 315(e) of the Trust Indenture Act of 1939, any Noteholder who
has been a bona fide Holder of a Note or Notes for at least six months may on
behalf of himself and all others similarly situated, petition any court of
competent jurisdiction for the removal of the Trustee and the appointment of a
successor trustee. Such court may thereupon, after such notice, if any, as it
may deem proper and prescribe, remove the Trustee and appoint a successor
trustee.
(c) The Holders of a majority in aggregate principal amount of either
series of Notes at the time outstanding may at any time remove the Trustee and
106
<PAGE> 112
appoint a successor trustee by delivering to the Trustee so removed, to the
successor trustee so appointed and to the Company the evidence provided for in
Section 6.01 of the action in that regard taken by the applicable Noteholders.
If no successor trustee shall have been so appointed and have accepted
appointment 30 days after the mailing of such notice of removal, the Trustee
being removed may petition, at the expense of the Company, any court of
competent jurisdiction for the appointment of a successor trustee. Such court
may thereupon, after such notice, if any, as it may deem proper and prescribe,
appoint a successor trustee.
(d) Any resignation or removal of the Trustee and any appointment of a
successor trustee pursuant to any of the provisions of this Section shall become
effective upon acceptance of appointment by the successor trustee as provided in
Section 5.11.
SECTION 5.11. Acceptance of Appointment by Successor Trustee. Any
successor trustee appointed as provided in Section 5.10 shall execute and
deliver to the Company and to its predecessor trustee an instrument accepting
such appointment hereunder, and thereupon the resignation or removal of the
predecessor trustee shall become effective and such successor trustee, without
any further act, deed or conveyance, shall become vested with all rights,
powers, duties and obligations of its predecessor hereunder, with like effect as
if originally named as Trustee herein; but, nevertheless, on the written request
of the Company or of the successor trustee, upon payment of its charges then
unpaid, the Trustee ceasing to act shall, subject to Section 10.06, pay over to
the successor trustee all moneys at the time held by it hereunder and shall
execute and deliver an instrument transferring to such successor trustee all
such rights, powers, duties and obligations. Upon request of any such successor
trustee, the Company shall execute any and all instruments in writing for more
fully and certainly vesting in and confirming to such successor trustee all such
rights and powers. Any Trustee ceasing to act shall, nevertheless, retain a
prior claim upon all property or funds held or collected by such Trustee to
secure any amounts then due it pursuant to the provisions of Section 5.07.
Upon acceptance of appointment by a successor trustee as provided in
this Section, the Company shall mail notice thereof by first-class mail to the
Holders of Notes at their last addresses as they shall appear in the Note
Register. If the acceptance of appointment is substantially contemporaneous with
the resignation, then the notice called for by the preceding sentence may be
combined with the notice called for by Section 5.10. If the Company fails to
mail such notice within 10 days after acceptance of appointment by the successor
trustee, the successor trustee shall cause such notice to be mailed at the
expense of the Company.
107
<PAGE> 113
SECTION 5.12. Merger, Conversion, Consolidation or Succession to
Business of Trustee. Any corporation into which the Trustee may be merged or
converted or with which it may be consolidated, or to which the Trustee's assets
may be sold, or any corporation resulting from any merger, conversion,
consolidation or sale to which the Trustee shall be a party or by which the
Trustee's property may be bound, or any corporation succeeding to all or
substantially all the corporate trust business of the Trustee, shall be the
successor of the Trustee hereunder, provided that such corporation shall be
eligible under the provisions of Section 5.09, without the execution or filing
of any paper or any further act on the part of any of the parties hereto,
anything herein to the contrary notwithstanding.
In case at the time such successor to the Trustee shall succeed to the
trusts created by this Indenture any of the Notes shall have been authenticated
but not delivered, any such successor to the Trustee may adopt the certificate
of authentication of any predecessor Trustee and deliver such Notes so
authenticated; and, in case at that time any of the Notes shall not have been
authenticated, any successor to the Trustee may authenticate such Notes either
in the name of any predecessor hereunder or in the name of the successor
Trustee; and in all such cases such certificate shall have the full force which
it is anywhere in the Notes or in this Indenture provided that the certificate
of the Trustee shall have; provided, that the right to adopt the certificate of
authentication of any predecessor Trustee or to authenticate Notes in the name
of any predecessor Trustee shall apply only to its successor or successors by
merger, conversion or consolidation.
SECTION 5.13. Preferential Collection of Claims. Reference is made to
Section 311 of the Trust Indenture Act of 1939. For purposes of Section 311(b)
(4) and (6) of such Act, the following terms shall mean:
(a) "CASH TRANSACTION" means any transaction in which full payment for
goods or securities sold is made within seven days after delivery of the goods
or securities in currency or in checks or other orders drawn upon banks or
bankers and payable upon demand; and
(b) "SELF-LIQUIDATING PAPER" means any draft, bill of exchange,
acceptance or obligation which is made, drawn, negotiated or incurred by the
Company for the purpose of financing the purchase, processing, manufacturing,
shipment, storage or sale of goods, wares or merchandise and which is secured by
documents evidencing title to, possession of, or a lien upon, the goods, wares
or merchandise or the receivables or proceeds arising from the sale of the
goods, wares or merchandise previously constituting the security, provided the
security is received by the Trustee simultaneously with the creation of the
creditor
108
<PAGE> 114
relationship with the Company arising from the making, drawing, negotiating or
incurring of the draft, bill of exchange, acceptance or obligation.
ARTICLE 6
CONCERNING THE HOLDERS
SECTION 6.01. Evidence of Action Taken by Holders. Any request, demand,
authorization, direction, notice, consent, waiver or other action provided by
this Indenture to be given or taken by Noteholders may be embodied in and
evidenced by one or more instruments of substantially similar tenor signed by
such Noteholders in person or by agent duly appointed in writing; and, except as
herein otherwise expressly provided, such action shall become effective when
such instrument or instruments are delivered to the Trustee. Proof of execution
of any instrument or of a writing appointing any such agent shall be sufficient
for any purpose of this Indenture and (subject to Section 5.01 and Section 5.02)
conclusive in favor of the Trustee and the Company, if made in the manner
provided in this Article.
SECTION 6.02. Proof of Execution of Instruments and of Holding of
Notes; Record Date. Subject to Section 5.01 and Section 5.02, the execution of
any instrument by a Noteholder or his agent or proxy may be proved in accordance
with such reasonable rules and regulations as may be prescribed by the Trustee
or in such manner as shall be satisfactory to the Trustee. The holding of Notes
shall be proved by the Note register or by a certificate of the Registrar
thereof. The Company may set a record date for purposes of determining the
identity of Holders of Notes entitled to vote or consent to any action referred
to in Section 6.01, which record date may be set at any time or from time to
time by notice to the Trustee, for any date or dates (in the case of any
adjournment or resolicitation) not more than 60 days nor less than five days
prior to the proposed date of such vote or consent, and thereafter,
notwithstanding any other provisions hereof, only Holders of Notes of record on
such record date shall be entitled to so vote or give such consent or to
withdraw such vote or consent.
SECTION 6.03. Notes Owned by Company Deemed Not Outstanding. In
determining whether the Holders of the requisite aggregate principal amount of
2008 Notes or 2010 Notes, as the case may be, have concurred in any direction,
consent or waiver under this Indenture, Notes which are owned by the Company or
any other obligor on the Notes or by any person directly or indirectly
controlling or controlled by or under direct or indirect common control with the
Company or any other obligor on the Notes shall be disregarded and deemed not to
be outstanding for the purpose of any such determination, except that for the
109
<PAGE> 115
purpose of determining whether the Trustee shall be protected in relying on any
such direction, consent or waiver only Notes which a Responsible Officer of the
Trustee actually knows are so owned shall be so disregarded. Notes so owned
which have been pledged in good faith may be regarded as outstanding if the
pledgee establishes to the satisfaction of the Trustee the pledgee's right so to
act with respect to such Notes and that the pledgee is not the Company or any
other obligor upon the Notes or any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company or any
other obligor on the Notes. In case of a dispute as to such right, the advice of
counsel shall be full protection in respect of any decision made by the Trustee
in accordance with such advice. Upon request of the Trustee, the Company shall
furnish to the Trustee promptly an Officers' Certificate listing and identifying
all Notes, if any, known by the Company to be owned or held by or for the
account of any of the above-described persons; and, subject to Section 5.01 and
Section 5.02, the Trustee shall be entitled to accept such Officers' Certificate
as conclusive evidence of the facts therein set forth and of the fact that all
Notes not listed therein are outstanding for the purpose of any such
determination.
SECTION 6.04. Right of Revocation of Action Taken. At any time prior to
(but not after) the evidencing to the Trustee, as provided in Section 6.01, of
the taking of any action by the Holders of the percentage in aggregate principal
amount of the 2008 Notes or 2010 Notes, as the case may be, specified in this
Indenture in connection with such action, any Holder of a Note the serial number
of which is shown by the evidence to be included among the serial numbers of the
Notes the Holders of which have consented to such action may, by filing written
notice at the Corporate Trust Office and upon proof of holding as provided in
this Article, revoke such action so far as concerns such Note. Except as
aforesaid any such action taken by the Holder of any Note shall be conclusive
and binding upon such Holder and upon all future Holders and owners of such Note
and of any Notes issued in exchange or substitution therefor, irrespective of
whether or not any notation in regard thereto is made upon any such Note. Any
action taken by the Holders of the percentage in aggregate principal amount of
the 2008 Notes or 2010 Notes, as the case may be, specified in this Indenture in
connection with such action shall be conclusively binding upon the Company, the
Trustee and the Holders of all such Notes.
110
<PAGE> 116
ARTICLE 7
SUPPLEMENTAL INDENTURES
SECTION 7.01. Supplemental Indentures Without Consent of Holders. The
Company, the Guarantors, if any, and the Trustee may, at any time and from time
to time, enter into one or more indentures supplemental to the Indenture without
notice to, or the consent of, any Holder:
(i) to evidence the succession of another Person to the
Company and the assumption by such successor of the covenants of the
Company in the Indenture and the Notes;
(ii) to add to the covenants of the Company, for the benefit
of the Holders, or to surrender any right or power conferred upon the
Company by the Indenture;
(iii) to add any additional Events of Default;
(iv) to provide for uncertificated Notes in addition to or in
place of certificated Notes;
(v) to evidence and provide for the acceptance of appointment
under the Indenture of a successor trustee;
(vi) to secure the Notes;
(vii) to comply with the Trust Indenture Act of 1939;
(viii) to add additional Guarantees with respect to the Notes
or to release Guarantors from Domestic Restricted Subsidiary Guarantees
as provided by the terms of the Indenture; or
(ix) to cure any ambiguity in the Indenture, to correct or
supplement any provision in the Indenture which may be inconsistent
with any other provision therein or to add any other provision with
respect to matters or questions arising under the Indenture;
provided such actions shall not adversely affect the interests of the Holders in
any material respect.
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, and upon receipt
by the Trustee of the documents described in Section 7.04 hereof, the Trustee
shall
111
<PAGE> 117
join with the Company and the Guarantors, if any, in the execution of any supple
mental indenture authorized or permitted by the terms of this Indenture and to
make any further appropriate agreements and stipulations which may be therein
contained, but the Trustee shall not be obligated to enter into such
supplemental indenture which affects its own rights, duties or immunities under
this Indenture or otherwise.
SECTION 7.02. Supplemental Indentures With Consent of Holders. Except
as provided in the next succeeding paragraphs, this Indenture or either series
of Notes issued hereunder may be amended or supplemented with the consent of the
Holders of at least a majority in aggregate principal amount of the 2008 Notes
or 2010 Notes, as the case may be, then outstanding (including consents obtained
in connection with a tender offer or exchange offer for such Notes), and any
existing default or compliance with any provision of this Indenture or either
series of Notes may be waived with the consent of the Holders of a majority in
aggregate principal amount of the then outstanding 2008 Notes or 2010 Notes, as
the case may be (including consents obtained in connection with a tender offer
or exchange offer for such Notes).
Upon the request of the Company accompanied by a Board Resolution
authorizing the execution of any such supplemental indenture, 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 7.04 hereof, the Trustee shall join with the Company and
the Guarantors (if any), in the execution of such supplemental indenture unless
such supplemental indenture affects the Trustee's own rights, duties or
immunities under this Indenture or otherwise, in which case the Trustee may in
its discretion, but shall not be obligated to, enter into such supplemental
indenture.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment or waiver, but
it shall be sufficient if such consent approves the substance thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Company shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Company to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture or waiver.
Subject to Section 4.04 and Section 4.07 hereof, the Holders of a majority in
aggregate principal amount of the 2008 Notes or 2010 Notes, as the case may be,
then outstanding may waive compliance in a particular instance by the Company
with any provision of this Indenture or the applicable series of Notes. With the
consent of the Holders of not less than a majority in principal amount of the
outstanding
112
<PAGE> 118
2008 Notes or 2010 Notes, as the case may be, the Company, the Guarantors, if
any, and the Trustee may enter into one or more indentures supplemental to the
Indenture for the purpose of adding any provisions to or changing in any manner
or eliminating any of the provisions of the Indenture or modifying in any manner
the rights of the Holders of such series; provided that no such supplemental
indenture shall, without the consent of the Holder of each outstanding Note of
the affected series:
(i) change the Stated Maturity of the principal of, or any
installment of interest on, any such Note, or reduce the principal
amount thereof or the interest thereon that would be due and payable
upon the Stated Maturity thereof, or change the place of payment where,
or the coin or currency in which, any such Note or any premium or
interest thereon is payable, or impair the right to institute suit for
the enforcement of any such payment on or after the Stated Maturity
thereof;
(ii) reduce the percentage in principal amount of the
outstanding Notes, the consent of whose Holders is necessary for any
such supplemental indenture or required for any waiver of compliance
with certain provisions of the Indenture or certain Defaults
thereunder;
(iii) subordinate in right of payment, or otherwise
subordinate, such Notes to any other Debt;
(iv) except as otherwise required by the Indenture, release
any security interest that may have been granted in favor of the
Holders of such Notes;
(v) reduce the premium payable upon the redemption of any such
Note nor change the time at which any such Note may be redeemed;
(vi) reduce the premium payable upon a Change of Control
Triggering Event;
(vii) make any change in any Domestic Restricted Subsidiary
Guarantee that would adversely affect the Holders of such Notes; or
(viii) modify any provision of this paragraph (except to
increase any percentage set forth herein).
Neither the Company nor any of its Subsidiaries will, directly or
indirectly, pay or cause to be paid any consideration, whether by way of
interest, fee or otherwise to any Holder of any Notes for or as an inducement to
any consent,
113
<PAGE> 119
waiver or amendment of any of the terms or provisions of the Indenture or the
Notes unless such consideration is offered to be paid or agreed to be paid 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.
SECTION 7.03. Effect of Supplemental Indenture. Upon the execution of
any supplemental indenture pursuant to the provisions hereof, this Indenture
shall be and be deemed to be modified and amended in accordance therewith and
the respective rights, limitations of rights, obligations, duties and immunities
under this Indenture of the Trustee, the Company and the Holders of Notes shall
thereafter be determined, exercised and enforced hereunder subject in all
respects to such modifications and amendments, and all the terms and conditions
of any such supplemental indenture shall be and be deemed to be part of the
terms and conditions of this Indenture for any and all purposes.
SECTION 7.04. Documents to Be Given to Trustee; Compliance with TIA.
The Trustee, subject to the provisions of Section 5.01 and Section 5.02, may
receive an Officers' Certificate and an Opinion of Counsel as conclusive
evidence that any such supplemental indenture complies with the applicable
provisions of this Indenture. Every such supplemental indenture shall comply
with the TIA.
SECTION 7.05. Notation on Notes in Respect of Supplemental Indentures.
Notes authenticated and delivered after the execution of any supplemental
indenture pursuant to the provisions of this Article may bear a notation
approved by the Trustee as to form (but not as to substance) as to any matter
provided for by such supplemental indenture or as to any action taken at any
such meeting. If the Company or the Trustee shall so determine, new Notes so
modified as to conform, in the opinion of the Trustee and the Board of
Directors, to any modification of this Indenture contained in any such
supplemental indenture may be prepared by the Company, authenticated by the
Trustee and delivered in exchange for the Notes then outstanding.
ARTICLE 8
CONSOLIDATION, MERGER OR SALE OF ASSETS
SECTION 8.01. Consolidation, Merger or Sale of Assets. The Company may
not, in a single transaction or a series of related transactions,
(1) consolidate with or merge into any other Person or Persons
or permit any other Person to consolidate with or merge into the
Company, or
114
<PAGE> 120
(2) directly or indirectly, transfer, sell, lease, convey or
otherwise dispose of all or substantially all its assets to any other
Person or Persons,
unless:
(a) in a transaction in which the Company is not the
resulting, surviving or transferee Person or in which the
Company transfers, sells, leases, conveys or otherwise
disposes of all or substantially all of its assets to any
other Person, the resulting, surviving or transferee Person
(the "SUCCESSOR ENTITY") is organized under the laws of the
United States of America or any State thereof or the District
of Columbia and shall expressly assume, by a supplemental
indenture executed and delivered to the Trustee in form
satisfactory to the Trustee, all of the Company's obligations
under the Indenture;
(b) immediately before and after giving effect to
such transaction and treating any Debt which becomes an
obligation of the Company or a Restricted Subsidiary as a
result of such transaction as having been Incurred by the
Company or such Restricted Subsidiary at the time of the
transaction, no Default or Event of Default shall have
occurred and be continuing;
(c) immediately after giving effect to such
transaction and treating any Debt which becomes an obligation
of the Company or a Restricted Subsidiary as a result of such
transaction as having been Incurred by the Company (or the
successor entity to the Company) or such Restricted Subsidiary
at the time of the transaction, the Company (or the successor
entity to the Company) could Incur at least $1.00 of
additional Debt pursuant to paragraph (a) of Section 3.08;
(d) if, as a result of any such transaction, Property
of the Company or any Restricted Subsidiary would become
subject to a Lien prohibited by the Company in Section 3.13,
the Company or the successor entity to the Company shall have
secured the Notes as required by said covenant; and
(e) in the case of a transfer, sale, lease,
conveyance or other disposition of all or substantially all of
the assets of the Company, such assets shall have been
transferred as an entirety or virtually as an entirety to one
Person and such Person shall have complied with all the
provisions of this Section.
115
<PAGE> 121
SECTION 8.02. Successor Corporation Substituted. (a) 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 Company in
accordance with Section 8.01 hereof, the successor corporation formed by such
consolidation or into or with which the Company 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, assignment, transfer, lease, conveyance or other
disposition, the provisions of this Indenture referring to the "Company" shall
refer, except in the case of a lease, instead to the successor corporation), and
may exercise every right and power of, the Company under this Indenture with the
same effect as if such successor Person had been named as the Company herein.
(b) Notwithstanding the foregoing, (1) a consolidation or merger by the
Company with or into, or (2) the sale, assignment, transfer, lease, conveyance
or other disposition by the Company of all or substantially all of its property
or assets to, one or more of its Subsidiaries shall not relieve the Company from
its obligations under this Indenture and the Notes.
(c) Notwithstanding the foregoing, but subject to Section 8.01(2)(a)
and (b), the Company may merge or consolidate with or into any Restricted
Subsidiary.
SECTION 8.03. Opinion of Counsel to Trustee. The Trustee, subject to
the provisions of Section 5.01 and Section 5.02, may receive an Opinion of
Counsel as conclusive evidence that any such consolidation, merger, conveyance,
sale, transfer, lease, exchange or other disposition complies with the
applicable provisions of this Indenture.
ARTICLE 9
REDEMPTION OF NOTES
SECTION 9.01. Right of Optional Redemption; Prices.
The Company may redeem all or part of the 2008 Notes at any time upon
not less than 30 nor more than 60 days' notice at the Make-Whole Price, plus
accrued and unpaid interest on the 2008 Notes, if any, to the redemption date.
In addition, at any time or from time to time prior to August 1, 2003,
the Company may redeem up to 35% of the original aggregate principal amount of
the
116
<PAGE> 122
2008 Notes at a redemption price equal to 111.70% of the principal amount of the
2008 Notes so redeemed, plus accrued and unpaid interest thereon (if any) to the
redemption date (subject to the right of Holders of record on the relevant
Regular Record Date to receive interest due on the relevant Interest Payment
Date), with the net cash proceeds of one or more private placements to Persons
other than Affiliates of the Company or public offerings of common stock of the
Company, in each case resulting in gross proceeds to the Company of at least
$100 million in the aggregate; provided that (1) at least 65% of the original
aggregate principal amount of the 2008 Notes would remain outstanding
immediately after giving effect to such redemption; (2) any such redemption
shall be made within 90 days of such private placement or public offering upon
not less than 30 nor more than 60 days' prior notice; and (3) any such
redemption may not occur in connection with or after the occurrence of a Change
of Control.
Prior to August 1, 2005, the Company may redeem all or part of the 2010
Notes at any time upon not less than 30 nor more than 60 days' notice at the
Make-Whole Price, plus accrued and unpaid interest on the 2010 Notes, if any, to
the redemption date. On or after August 1, 2005, the Company at its option may,
at any time, redeem all, or from time to time any part of, the 2010 Notes upon
payment of the optional redemption prices set forth in the form of Note
hereinabove recited, together with accrued and unpaid interest to the date fixed
for redemption.
In addition, at any time or from time to time prior to August 1, 2003,
the Company may redeem up to 35% of the original aggregate principal amount of
the 2010 Notes at a redemption price equal to 111.875% of the principal amount
of the 2010 Notes so redeemed, plus accrued and unpaid interest thereon (if any)
to the redemption date (subject to the right of Holders of record on the
relevant Regular Record Date to receive interest due on the relevant Interest
Payment Date), with the net cash proceeds of one or more private placements to
Persons other than Affiliates of the Company or public offerings of common stock
of the Company, in each case resulting in gross proceeds to the Company of at
least $100 million in the aggregate; provided that (1) at least 65% of the
original aggregate principal amount of the 2010 Notes would remain outstanding
immediately after giving effect to such redemption; (2) any such redemption
shall be made within 90 days of such private placement or public offering upon
not less than 30 nor more than 60 days' prior notice; and (3) any such
redemption may not occur in connection with or after the occurrence of a Change
of Control.
SECTION 9.02. Notice of Redemption; Partial Redemptions. Notice of
redemption to the Holders of Notes to be redeemed as a whole or in part shall be
given by mailing notice of such redemption by first class mail, postage prepaid,
at least 30 days and not more than 60 days prior to the date fixed for
redemption to such Holders of Notes at their last addresses as they shall appear
upon the registry
117
<PAGE> 123
books. Any notice which is mailed in the manner herein provided shall be
conclusively presumed to have been duly given, whether or not the Holder
receives the notice. Failure to give notice by mail, or any defect in the notice
to the Holder of any Note designated for redemption as a whole or in part shall
not affect the validity of the proceedings for the redemption of any other Note.
The notice of redemption to each such Holder shall identify the Notes
to be redeemed (including the CUSIP number) and shall specify the principal
amount of each Note held by such Holder to be redeemed, the date fixed for
redemption, the redemption price, the place or places of payment, that payment
will be made upon presentation and surrender of such Notes, that interest
accrued to the date fixed for redemption will be paid as specified in said
notice and that on and after said date interest thereon or on the portions
thereof to be redeemed will cease to accrue. In case any Note is to be redeemed
in part only the notice of redemption shall state the portion of the principal
amount thereof to be redeemed and shall state that on and after the date fixed
for redemption, upon surrender of such Note, a new Note or Notes in principal
amount equal to the unredeemed portion thereof will be issued.
The notice of redemption of Notes to be redeemed at the option of the
Company shall be given by the Company or, at the Company's request, by the
Trustee in the name and at the expense of the Company.
No later than 10:00 a.m. on the redemption date specified in the notice
of redemption given as provided in this Section, the Company will deposit with
the Trustee or with one or more paying agents (or, if the Company is acting as
its own paying agent, set aside, segregate and hold in trust as provided in
Section 3.04) an amount of money sufficient to redeem on the redemption date all
the Notes so called for redemption at the appropriate redemption price, together
with accrued interest to the date fixed for redemption. The Company will deliver
to the Trustee at least 70 days prior to the date fixed for redemption an
Officers' Certificate stating the aggregate principal amount of Notes to be
redeemed.
If less than all the Notes are to be redeemed, the Trustee shall
select, either pro rata, by lot or by any other method it shall in its sole
discretion deem fair and appropriate, Notes to be redeemed in whole or in part;
provided that no Note of $1,000 in principal amount or less shall be redeemed in
part. The Trustee shall promptly notify the Company in writing of the Notes
selected for redemption and, in the case of any Notes selected for partial
redemption, the principal amount thereof to be redeemed. For all purposes of
this Indenture, unless the context otherwise requires, all provisions relating
to the redemption of Notes shall relate, in the case of any Note redeemed or to
be redeemed only in part, to the portion of the principal amount of such Note
which has been or is to be redeemed.
118
<PAGE> 124
SECTION 9.03. Payment of Notes Called for Redemption. If notice of
redemption has been given as above provided, the Notes or portions of Notes
specified in such notice shall become due and payable on the date and at the
place stated in such notice at the applicable redemption price, together with
interest accrued to the date fixed for redemption, and on and after said date
(unless the Company shall default in the payment of such Notes at the redemption
price, together with interest accrued to said date) interest on the Notes or
portions of Notes so called for redemption shall cease to accrue and, except as
provided in Section 5.05 and Section 11.06, such Notes shall cease from and
after the date fixed for redemption to be entitled to any benefit or security
under this Indenture, and the Holders thereof shall have no right in respect of
such Notes except the right to receive the redemption price thereof and unpaid
interest to the date fixed for redemption. On presentation and surrender of such
Notes at a place of payment specified in said notice, said Notes or the
specified portions thereof shall be paid and redeemed by the Company at the
applicable redemption price, together with interest accrued thereon to the date
fixed for redemption; provided that any semi-annual payment of interest becoming
due on or prior to the date fixed for redemption shall be payable to the Holders
of such Notes registered as such on the relevant Regular Record Date subject to
the terms and provisions of Section 2.04 hereof.
If any Note called for redemption shall not be so paid upon surrender
thereof for redemption, the principal shall, until paid or duly provided for,
bear interest from the date fixed for redemption at the rate borne by the Note.
Upon presentation of any Note redeemed in part only, the Company shall
execute and the Trustee shall authenticate and make available for delivery to or
on the order of the Holder thereof, at the expense of the Company, a new Note or
Notes, of authorized denominations, in principal amount equal to the unredeemed
portion of the Note so presented.
SECTION 9.04. Exclusion of Certain Notes from Eligibility for Selection
for Redemption. Notes shall be excluded from eligibility for selection for
redemption if they are identified by registration and certificate number in a
written statement signed by an authorized officer of the Company and delivered
to the Trustee at least 40 days prior to the last date on which notice of
redemption may be given as being owned of record and beneficially by, and not
pledged or hypothecated by either (a) the Company or (b) an entity specifically
identified in such written statement as directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company.
119
<PAGE> 125
ARTICLE 10
DEFEASANCE AND COVENANT DEFEASANCE
SECTION 10.01. Company's Option to Effect Defeasance or Covenant
Defeasance. The Company may at its option by a Board Resolution, at any time,
elect to have either Section 10.02 or Section 10.03 applied to the outstanding
Notes upon compliance with the conditions set forth below in this Article Ten.
SECTION 10.02. Legal Defeasance and Discharge. Upon the Company's
exercise under Section 10.01 hereof of the option applicable to this Section,
the Company shall be deemed to have been discharged from any and all Obligations
with respect to all outstanding Notes (and any Guarantor will be discharged from
any and all Obligations in respect of its Subsidiary Guarantee) on the date
which is the 123rd day after the deposit referred to in Section 10.04(a);
provided that all of the conditions set forth below are satisfied (hereinafter,
"LEGAL DEFEASANCE"). For this purpose, such Legal Defeasance means that the
Company shall be deemed to have paid and discharged the entire Debt represented
by the outstanding Notes, which shall thereafter be deemed to be "outstanding"
only for the purposes of Section 10.05 hereof and the other Sections of this
Indenture referred to in clauses (1) and (2) of this Section, and to have
satisfied all its other obligations under such Notes and this Indenture (and the
Trustee, on demand of and at the expense of the Company, shall execute proper
instruments acknowledging the same), except for the following provisions which
shall survive until otherwise terminated or discharged hereunder: (1) the rights
of Holders of outstanding Notes to receive solely from the trust fund described
in Section 10.04 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, (2) the Company's obligations with respect to such Notes
under Sections 2.01, 2.02, 2.05, 2.06, 2.07, 2.09, 2.11, 3.01, 3.02, 3.04, 9.01,
10.05 and 10.07 hereof, (3) the rights, powers, trusts, duties and immunities of
the Trustee hereunder, including, without limitation, the Trustee's rights under
Section 5.07 hereof, and (4) the Company's obligations in connection therewith
and with this Article Ten. Subject to compliance with this Article Ten, the
Company may exercise its option under this Section notwithstanding the prior
exercise of its option under Section 10.03 hereof with respect to the Notes.
SECTION 10.03. Covenant Defeasance. Upon the Company's exercise under
Section 10.01 hereof of the option applicable to this Section, the Company shall
be released from its obligations under the covenants contained in Section 3.08
through Section 3.18, Section 3.20 and clauses (c), (d) and (e) of Section 8.01
hereof with respect to the outstanding Notes on and after the date the
conditions set forth below are satisfied (hereinafter, "COVENANT DEFEASANCE"),
and the Notes shall thereafter be deemed not outstanding for the purposes of any
direction,
120
<PAGE> 126
waiver, consent or declaration or act of Holders (and the consequences of any
thereof) in connection with such covenants, but shall continue to be deemed
outstanding for all other purposes hereunder. For this purpose, such Covenant
Defeasance means that, with respect to the outstanding Notes, the Company may
omit to comply with and shall have no liability in respect of any term,
condition or limitation set forth in any such covenant, whether directly or
indirectly, by reason of any reference elsewhere herein to any such covenant or
by reason of any reference in any such covenant to any other provision herein or
in any other document and such omission to comply shall not constitute a Default
or an Event of Default under Section 4.01(c) or 4.01(d) hereof, but, except as
specified above, the remainder of this Indenture and such Notes shall be
unaffected thereby.
SECTION 10.04. Conditions to Legal or Covenant Defeasance. The
following shall be the conditions to application of either Section 10.02 or
Section 10.03 hereof to the outstanding Notes:
(a) the Company has deposited with the Trustee, in trust, money and/or
U.S. Government Obligations that through the payment of interest and principal
in respect thereof in accordance with their terms will provide money in an
amount sufficient, in the opinion of a nationally recognized firm of independent
public accountants expressed in a written certification thereof delivered to the
Trustee, to pay the principal of, premium, if any, and accrued interest, on the
Notes on the Stated Maturity of such payments in accordance with the terms of
the Indenture and the Notes;
(b) in the case of an election under Section 10.02 hereof, the Company
has delivered to the Trustee (1) either (x) an Opinion of Counsel to the effect
that Holders will not recognize income, gain or loss for Federal income tax
purposes as a result of the Company's exercise of its option under this Article
Ten and will be subject to Federal income tax on the same amount and in the same
manner and at the same times as would have been the case if such deposit,
defeasance and discharge had not occurred, which Opinion of Counsel must be
based upon (and accompanied by a copy of) a ruling of the Internal Revenue
Service to the same effect unless there has been a change in applicable Federal
income tax law after the date of this Indenture such that a ruling is no longer
required or (y) a ruling directed to the Trustee received from the Internal
Revenue Service to the same effect as the aforementioned Opinion of Counsel and
(2) an Opinion of Counsel to the effect that the creation of the defeasance
trust does not violate the Investment Company Act of 1940 and after the passage
of 123 days following the deposit, the trust fund will not be subject to the
effect of Section 547 of the United States Bankruptcy Code or Section 15 of the
New York Debtor and Creditor Law;
121
<PAGE> 127
(c) in the case of an election under Section 10.03 hereof, the delivery
by the Company to the Trustee of (1) an Opinion of Counsel to the effect that,
among other things, the Holders will not recognize income, gain or loss for
Federal income tax purposes as a result of such deposit and defeasance and will
be subject to Federal income tax on the same amount and in the same manner and
at the same times as would have been the case if such deposit and defeasance had
not occurred and (2) an Opinion of Counsel to the effect that the creation of
the defeasance trust does not violate the Investment Company Act of 1940 and
after the passage of 123 days following the deposit, the trust fund will not be
subject to the effect of Section 547 of the United States Bankruptcy Code or
Section 15 of the New York Debtor and Creditor Law;
(d) immediately after giving effect to such deposit on a pro forma
basis, no Event of Default, or event that after the giving of notice or lapse of
time or both would become an Event of Default, shall have occurred and be
continuing on the date of such deposit or during the period ending on the 123rd
day after the date of such deposit, and such deposit shall not result in a
breach or violation of, or constitute a default under, any other agreement or
instrument to which the Company is a party or by which the Company is bound;
(e) if at such time the Notes are listed on a national securities
exchange, the Company has delivered to the Trustee an Opinion of Counsel to the
effect that the Notes will not be delisted as a result of such deposit,
defeasance and discharge;
(f) the Company shall have delivered to the Trustee an Officers'
Certificate stating that the deposit made by the Company pursuant to its
election under Section 10.02 or 10.03 hereof was not made by the Company with
the intent of preferring the Holders of the Notes over the other creditors of
the Company with the intent of defeating, hindering, delaying or defrauding
creditors of the Company or others; and
(g) the Company shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel, each stating that all conditions
precedent provided for relating to either the Legal Defeasance under Section
10.02 or the Covenant Defeasance under Section 10.03 (as the case may be) have
been complied with as contemplated by this Section.
SECTION 10.05. Deposited Money and Government Securities to Be Held in
Trust; Other Miscellaneous Provisions. Subject to Section 10.06 hereof, all
money and U.S. Government Obligations (including the proceeds thereof) deposited
with the Trustee pursuant to Section 10.04 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
122
<PAGE> 128
directly or through any paying agent (including the Company 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 of, premium, if any, and
interest, but such money need not be segregated from other funds except to the
extent required by law.
The Company shall pay and indemnify the Trustee against any tax, fee or
other charge imposed on or assessed against the money or U.S. Government
Obligations deposited pursuant to Section 10.04 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 Ten to the contrary notwithstanding, the
Trustee shall deliver or pay to the Company from time to time upon the Company's
request any money or U.S. Government Obligations held by it as provided in
Section 10.04 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
10.04(a) hereof), are in excess of the amount thereof which would then be
required to be deposited to effect an equivalent Legal Defeasance or Covenant
Defeasance.
SECTION 10.06. Repayment to Company. Any money deposited with the
Trustee or any paying agent, or then held by the Company, in trust for the
payment of the principal of, premium, if any, or interest on any Note and
remaining unclaimed for two years after such principal, premium, if any, or
interest has become due and payable shall be paid to the Company on its written
request or (if then held by the Company) shall be discharged from such trust;
and the Holder of such Note shall thereafter, as an unsecured general creditor,
look only to the Company for payment thereof, and all liability of the Trustee
or such paying agent with respect to such trust money, and all liability of the
Company as Trustee thereof, shall thereupon cease; provided, however, that the
Trustee or such paying agent, before being required to make any such repayment,
may at the expense of the Company cause to be published once, in The New York
Times and The Wall Street Journal (national edition), notice that such money
remains unclaimed and that, after a date specified therein, which shall not be
less than 30 days from the date of such notification or publication, any
unclaimed balance of such money then remaining will be repaid to the Company.
SECTION 10.07. Reinstatement. If the Trustee or paying agent is unable
to apply any money or U.S. Government Obligations in accordance with Section
10.02 or 10.03 hereof, as the case may be, by reason of any order or judgment of
any court or governmental authority enjoining, restraining or otherwise
prohibiting such application, then the Company's obligations under this
123
<PAGE> 129
Indenture and the Notes shall be revived and reinstated as though no deposit had
occurred pursuant to Section 10.02 or 10.03 hereof until such time as the
Trustee or paying agent is permitted to apply all such amounts in accordance
with Section 10.02 or 10.03 hereof, as the case may be; provided, however, that,
if the Company makes any payment of principal of, premium, if any, or interest
on any Note following the reinstatement of its obligations, the Company shall be
subrogated to the rights of the Holders of such Note to receive such payment
from the amounts held by the Trustee or paying agent.
ARTICLE 11
MISCELLANEOUS PROVISIONS
SECTION 11.01. Incorporators, Stockholders, Officers, Directors,
Employees and Controlling Persons of Company Exempt from Individual Liability.
No recourse for the payment of the principal of, premium, if any, or interest on
any of the Notes or any claim based thereon or otherwise in respect thereof, and
no recourse under or upon any obligation, covenant or agreement of the Company
contained in this Indenture, or in any Note, or because of the creation of any
indebtedness evidenced thereby, shall be had against any incorporator, as such,
or against any past, present or future stockholder, officer, director, employee
or controlling person, as such, of the Company or of any successor Person,
either directly or through the Company or any successor Person, under any rule
of law, statute or constitutional provision or by the enforcement of any
assessment or by any legal or equitable proceeding or otherwise, all such
liability being expressly waived and released by the acceptance of the Notes by
the Holders thereof and as part of the consideration for the issue of the Notes.
SECTION 11.02. Provisions of Indenture for the Sole Benefit of Parties
and Holders. Nothing in this Indenture or in the Notes, expressed or implied,
shall give or be construed to give to any person, firm or corporation, other
than the parties hereto and their successors and the Holders of the Notes, any
legal or equitable right, remedy or claim under this Indenture or under any
covenant or provision herein contained, all such covenants and provisions being
for the sole benefit of the parties hereto and their successors and of the
Holders of the Notes.
SECTION 11.03. Successors and Assigns of Company Bound by Indenture.
All the covenants, stipulations, promises and agreements in this Indenture
contained by or in behalf of the Company shall bind its successors and assigns,
whether so expressed or not.
124
<PAGE> 130
SECTION 11.04. Notices and Demands on Company, Trustee and Holders. Any
notice or demand which by any provision of this Indenture is required or
permitted to be given or served by the Trustee or by the Holders of Notes to or
on the Company may be given or served by being deposited postage prepaid,
first-class mail (except as otherwise specifically provided herein) addressed
(until another address of the Company is filed by the Company with the Trustee)
to One Williams Center, Tulsa, Oklahoma, Attention: Chief Financial Officer,
with a copy to the office of General Counsel. Any notice, direction, request or
demand by the Company or any Noteholder to or upon the Trustee shall be deemed
to have been sufficiently given or made, for all purposes, if given or made at
the Corporate Trust Office.
Where this Indenture provides for notice to Holders, such notice shall
be sufficiently given (unless otherwise herein expressly provided) if in writing
and mailed, first-class postage prepaid, to each Holder entitled thereto, at his
last address as it appears in the Note Register. In any case where notice to
Holders is given by mail, neither the failure to mail such notice, nor any
defect in any notice so mailed, to any particular Holder shall affect the
sufficiency of such notice with respect to other Holders. Where this Indenture
provides for notice in any manner, such notice may be waived in writing by the
person entitled to receive such notice, either before or after the event, and
such waiver shall be the equivalent of such notice. The Trustee may waive notice
to it of any provision herein, and such waiver shall be deemed to be for its
convenience and discretion. Waivers of notice by Holders shall be filed with the
Trustee, but such filing shall not be a condition precedent to the validity of
any action taken in reliance upon such waiver.
In case, by reason of the suspension of or irregularities in regular
mail service, it shall be impracticable to mail notice to the Company and
Noteholders when such notice is required to be given pursuant to any provision
of this Indenture, then any manner of giving such notice as shall be
satisfactory to the Trustee shall be deemed to be a sufficient giving of such
notice.
SECTION 11.05. Officers' Certificates and Opinions of Counsel;
Statements to Be Contained Therein. Upon any application or demand by the
Company to the Trustee to take any action under any of the provisions of this
Indenture, the Company shall furnish to the Trustee an Officers' Certificate
stating that all conditions precedent provided for in this Indenture relating to
the proposed action have been complied with and an Opinion of Counsel stating
that in the opinion of such counsel all such conditions precedent have been
complied with, except that in the case of any such application or demand as to
which the furnishing of such documents is specifically required by any provision
of this Indenture relating to such particular application or demand, no
additional certificate or opinion need be furnished.
125
<PAGE> 131
Each certificate or opinion provided for in this Indenture and
delivered to the Trustee with respect to compliance with a condition or covenant
provided for in this Indenture 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 has made such
examination or investigation as is necessary to enable him to express an
informed opinion as to whether or not such covenant or condition has been
complied with and (d) a statement as to whether or not, in the opinion of such
person, such condition or covenant has been complied with.
Any certificate, statement or opinion of an officer of the Company may
be based, insofar as it relates to legal matters, upon a certificate or opinion
of or representations by counsel, unless such officer knows that the certificate
or opinion or representations with respect to the matters upon which his
certificate, statement or opinion may be based as aforesaid are erroneous, or in
the exercise of reasonable care should know that the same are erroneous. Any
certificate, statement or opinion of counsel may be based, insofar as it relates
to factual matters or information which is in the possession of the Company,
upon the certificate, statement or opinion of or representations by an officer
or officers of the Company, unless such counsel knows that the certificate,
statement or opinion or representations with respect to the matters upon which
his certificate, statement or opinion may be based as aforesaid are erroneous,
or in the exercise of reasonable care should know that the same are erroneous.
Any certificate, statement or opinion of an officer of the Company or
of counsel may be based, insofar as it relates to accounting matters, upon a
certificate or opinion of or representations by an accountant or firm of
accountants in the employ of the Company, unless such officer or counsel, as the
case may be, knows that the certificate or opinion or representations with
respect to the accounting matters upon which his certificate, statement or
opinion may be based as aforesaid are erroneous, or in the exercise of
reasonable care should know that the same are erroneous.
Any certificate or opinion of any independent firm of public
accountants filed with the Trustee shall contain a statement that such firm is
independent.
SECTION 11.06. Payments Due on Saturdays, Sundays and Holidays. If the
date of maturity of interest on or principal of the Notes or the date fixed for
redemption of any Note shall not be a Business Day, then payment of interest or
principal need not be made on such date, but may be made on the next succeeding
Business Day with the same force and effect as if made on the date of maturity
or
126
<PAGE> 132
the date fixed for redemption, and no interest shall accrue for the period after
such date.
SECTION 11.07. Conflict of Any Provision of Indenture with Trust
Indenture Act of 1939. If and to the extent that any provision of this Indenture
limits, qualifies or conflicts with another provision included in this Indenture
by operation of Section 310 to Section 317, inclusive, of the Trust Indenture
Act of 1939 (an "INCORPORATED PROVISION"), such incorporated provision shall
control.
SECTION 11.08. New York Law to Govern. This Indenture and each Note
shall be deemed to be a contract under the laws of the State of New York, and
for all purposes including the obligations of the Company and any Guarantor and
the rights of Holders of the Notes arising out of or in connection with the
Notes, including the obligations of the Company and any Guarantor to pay all
principal, interest or other amounts payable under the Indenture and such Note,
will be governed by and shall be construed in accordance with the laws of said
State, without giving effect to the conflict of laws provisions thereof, except
as may otherwise be required by mandatory provisions of law.
SECTION 11.09. Counterparts. This Indenture may be executed in any
number of counterparts, each of which shall be an original; but such
counterparts shall together constitute but one and the same instrument.
SECTION 11.10. Effect of Headings. The Article and Section headings
herein and the Table of Contents are for convenience only and shall not affect
the construction hereof.
127
<PAGE> 133
SIGNATURES
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be
duly executed, all as of August 8, 2000.
WILLIAMS COMMUNICATIONS GROUP, INC.,
as Issuer
By /s/ HOWARD S. KALIKA
---------------------------------------
Name: Howard S. Kalika
Title: Vice President and Treasurer
THE BANK OF NEW YORK,
as Trustee
By /s/ WALTER N. GITLIN
---------------------------------------
Name: Walter N. Gitlin
Title: Vice President
<PAGE> 134
EXHIBIT A
RESTRICTED LEGEND
THIS NOTE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED
(THE "SECURITIES ACT"), AND MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE
TRANSFERRED EXCEPT IN ACCORDANCE WITH THE FOLLOWING SENTENCE. BY ITS ACQUISITION
HEREOF OR OF A BENEFICIAL INTEREST HEREIN, THE ACQUIRER (1) REPRESENTS THAT (A)
IT AND ANY ACCOUNT FOR WHICH IT IS ACTING IS A "QUALIFIED INSTITUTIONAL BUYER"
(WITHIN THE MEANING OF RULE 144A UNDER THE SECURITIES ACT) AND THAT IT EXERCISES
SOLE INVESTMENT DISCRETION WITH RESPECT TO EACH SUCH ACCOUNT OR (B) IT IS NOT A
U.S. PERSON (WITHIN THE MEANING OF REGULATION S UNDER THE SECURITIES ACT) AND
(2) AGREES FOR THE BENEFIT OF THE COMPANY THAT IT WILL NOT OFFER, SELL, PLEDGE
OR OTHERWISE TRANSFER THIS NOTE OR ANY BENEFICIAL INTEREST HEREIN, EXCEPT IN
ACCORDANCE WITH THE SECURITIES ACT AND ANY APPLICABLE SECURITIES LAWS OF ANY
STATE OF THE UNITED STATES AND ONLY (A) TO THE COMPANY OR ANY SUBSIDIARY
THEREOF, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BECOME EFFECTIVE
UNDER THE SECURITIES ACT, (C) TO A QUALIFIED INSTITUTIONAL BUYER IN COMPLIANCE
WITH RULE 144A UNDER THE SECURITIES ACT, (D) IN AN OFFSHORE TRANSACTION IN
COMPLIANCE WITH RULE 904 OF REGULATION S UNDER THE SECURITIES ACT, OR (E)
PURSUANT TO AN EXEMPTION FROM REGISTRATION PROVIDED BY RULE 144 UNDER THE
SECURITIES ACT OR ANY OTHER AVAILABLE EXEMPTION FROM THE REGISTRATION
REQUIREMENTS OF THE SECURITIES ACT. PRIOR TO THE REGISTRATION OF ANY TRANSFER IN
ACCORDANCE WITH (2)(E) ABOVE, THE COMPANY RESERVES THE RIGHT TO REQUIRE THE
DELIVERY OF SUCH LEGAL OPINIONS, CERTIFICATIONS OR OTHER EVIDENCE AS MAY
REASONABLY BE REQUIRED IN ORDER TO DETERMINE THAT THE PROPOSED TRANSFER IS BEING
MADE IN COMPLIANCE WITH THE SECURITIES ACT AND APPLICABLE STATE SECURITIES LAWS.
NO REPRESENTATION IS MADE AS TO THE AVAILABILITY OF ANY RULE 144 EXEMPTION FROM
THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.
A-1
<PAGE> 135
EXHIBIT B
DEPOSITARY LEGEND
UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE COMPANY OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS A BENEFICIAL INTEREST HEREIN.
TRANSFERS OF THIS GLOBAL NOTE ARE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN
PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR'S
NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE ARE LIMITED TO TRANSFERS
MADE IN ACCORDANCE WITH THE TRANSFER PROVISIONS OF THE INDENTURE.
B-1
<PAGE> 136
EXHIBIT C
Rule 144A Certificate
To: The Bank of New York, as Trustee (the "Trustee")
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
Re: [ ]% Senior Redeemable Notes due 20__ (the "Notes") issued under
the Indenture (the "Indenture") dated as of August 8, 2000 between
Williams Communications Group, Inc. (the "Company") and the Trustee
Ladies and Gentlemen:
This Certificate relates to:
[CHECK A OR B AS APPLICABLE.]
[ ]A. Our proposed purchase of $____ principal amount of Notes
issued under the Indenture.
[ ]B. Our proposed exchange of $____ principal amount of Notes
issued under the Indenture for an equal principal amount of
Notes to be held by us.
We and, if applicable, each account for which we are acting, are a
qualified institutional buyer within the meaning of Rule 144A ("Rule 144A")
under the Securities Act of 1933, as amended (the "Securities Act"). If we are
acting on behalf of an account, we exercise sole investment discretion with
respect to such account. We are aware that the transfer of Notes to us, or such
exchange, as applicable, is being made in reliance upon the exemption from the
provisions of Section 5 of the Securities Act provided by Rule 144A. Prior to
the date of this Certificate we have received such information regarding the
Company as we have requested pursuant to Rule 144A(d)(4) or have determined not
to request such information.
You and the Company are entitled to rely upon this Certificate and are
irrevocably authorized to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
C-1
<PAGE> 137
Very truly yours,
[NAME OF SELLER (FOR
TRANSFERS) OR OWNER (FOR
EXCHANGES)]
By:
--------------------------
Name:
Title:
Address:
Date:
----------------
C-2
<PAGE> 138
EXHIBIT D
Regulation S Certificate
To: The Bank of New York, as Trustee (the "Trustee")
101 Barclay Street, Floor 21 West
New York, New York 10286
Attention: Corporate Trust Administration
Re: [ ]% Senior Redeemable Notes due 20__ (the "Notes") issued
under the Indenture (the "Indenture") dated as of August 8, 2000
between Williams Communications Group, Inc. (the "Company") and the
Trustee
Ladies and Gentlemen:
Terms are used in this Certificate as used in Regulation S ("Regulation
S") under the Securities Act of 1933, as amended (the "Securities Act"), except
as otherwise stated herein.
[CHECK A OR B AS APPLICABLE.]
[ ]A. This Certificate relates to our proposed transfer of $____
principal amount of Notes issued under the Indenture. We hereby certify as
follows:
1. The offer and sale of the Notes was not and will not be made
to a person in the United States (unless such person is
excluded from the definition of "U.S. person" pursuant to Rule
902(k)(2)(vi) or the account held by it for which it is acting
is excluded from the definition of "U.S. person" pursuant to
Rule 902(k)(2)(i) under the circumstances described in Rule
902(h)(3)) and such offer and sale was not and will not be
specifically targeted at an identifiable group of U.S.
citizens abroad.
2. Unless the circumstances described in the parenthetical in
paragraph 1 above are applicable, either (a) at the time the
buy order was originated, the buyer was outside the United
States or we and any person acting on our behalf reasonably
believed that the buyer was outside the United States or (b)
the transaction was executed in, on or through the facilities
of a designated offshore securities market, and neither we nor
any person acting on our behalf knows that the transaction was
pre-arranged with a buyer in the United States.
D-1
<PAGE> 139
3. Neither we, any of our affiliates, nor any person acting on
our or their behalf has made any directed selling efforts in
the United States with respect to the Notes.
4. The proposed transfer of Notes is not part of a plan or scheme
to evade the registration requirements of the Securities Act.
5. If we are a dealer or a person receiving a selling concession,
fee or other remuneration in respect of the Notes, and the
proposed transfer takes place during the Restricted Period (as
defined in the Indenture), or we are an officer or director of
the Company or an Initial Purchaser (as defined in the
Indenture), we certify that the proposed transfer is being
made in accordance with the provisions of Rule 904(b) of
Regulation S.
[ ]B. This Certificate relates to our proposed exchange of $____
principal amount of Notes issued under the Indenture for an equal principal
amount of Notes to be held by us. We hereby certify as follows:
1. At the time the offer and sale of the Notes was made to us,
either (i) we were not in the United States or (ii) we were
excluded from the definition of "U.S. person" pursuant to Rule
902(k)(2)(vi) or the account held by us for which we were
acting was excluded from the definition of "U.S. person"
pursuant to Rule 902(k)(2)(i) under the circumstances
described in Rule 902(h)(3); and we were not a member of an
identifiable group of U.S. citizens abroad.
2. Unless the circumstances described in paragraph 1(ii) above
are applicable, either (a) at the time our buy order was
originated, we were outside the United States or (b) the
transaction was executed in, on or through the facilities of a
designated offshore securities market and we did not
pre-arrange the transaction in the United States.
3. The proposed exchange of Notes is not part of a plan or scheme
to evade the registration requirements of the Securities Act.
You and the Company are entitled to rely upon this Certificate and are
irrevocably authorized to produce this Certificate or a copy hereof to any
interested party in any administrative or legal proceeding or official inquiry
with respect to the matters covered hereby.
D-2
<PAGE> 140
Very truly yours,
[NAME OF SELLER (FOR
TRANSFERS) OR OWNER (FOR
EXCHANGES)]
By:
--------------------------
Name:
Title:
Address:
Date:
----------------
D-3
