<PAGE>
As filed with the Securities and Exchange Commission on December 3, 1997
Registration No. 333-41127
================================================================================
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
------------------------------
Amendment No. 1 to
FORM F-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
------------------------------
Sun International Hotels Limited
Sun International North America, Inc.
(Exact name of registrant as specified in its charter)
Commonwealth of The Bahamas 98-0136554
Delaware 59-0763055
(State or other jurisdiction (I.R.S. Employer
of incorporation or organization) Identification No.)
SEE TABLE OF ADDITIONAL REGISTRANTS
Sun International Hotels Limited Sun International North America, Inc.
Coral Towers 1415 E. Sunrise Blvd., 10th Floor
Paradise Island, The Bahamas Ft. Lauderdale, Florida 33304
(242) 363-3000 (954) 713-2500
(Address and telephone number of (Address and telephone number of
principal executive principal executive offices of Sun International
offices of Sun International Hotels North America, Inc.)
Limited)
John R. Allison
Sun International Resorts, Inc.
1415 E. Sunrise Blvd., 10th Floor
Ft. Lauderdale, Florida 33304
(954) 713-2500
(Name, address, and telephone number of agent for service)
Copies to:
Charles D. Adamo, Esq. James M. Edwards, Esq.
Sun International Hotels Limited Cravath, Swaine & Moore
Executive Offices Worldwide Plaza
Coral Towers 825 Eighth Avenue
Paradise Island, The Bahamas New York, New York 10019
Nicholas P. Saggese, Esq.
Skadden, Arps, Slate, Meagher &
Flom LLP
300 South Grand Avenue
Los Angeles, CA 90071
------------------------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this registration statement, as determined
by market conditions and other factors.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. / /
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, check the following box. /X/
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. / /
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. / /
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. / /
---------------------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
- ----------------------------------------------------------------------------------------------------------------------------------
Proposed Maximum Proposed Maximum
Title of Each Class of Aggregate Price Aggregate Amount of
Securities to be Registered Amount to be Registered (1)(2) Per Unit(3) Offering Price(3) Registration Fee
- ----------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Debt Securities............ $300,000,000 100% $300,000,000 $90,909
- ----------------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) Includes such indeterminate principal amount of Debt Securities as may from
time to time be issued at indeterminate prices.
(2) In United States dollars or the equivalent thereof in one or more foreign
denominated currencies or currency units if Debt Securities are issued with
principal amounts denominated in one or more foreign or composite
currencies as shall be designated by the Issuers.
(3) Estimated solely for purposes of calculating the registration fee in
accordance with Rule 457(o) under the Securities Act of 1933 and exclusive
of accrued interest and dividends, if any.
---------------------------
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant shall
file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this Registration Statement shall become
effective on such date as the Commission, acting pursuant to said Section 8(a),
may determine.
================================================================================
<PAGE>
TABLE OF ADDITIONAL REGISTRANTS
Name, Address and Telephone Number of Jurisdiction of I.R.S. Employer
Additional Registrants Organization Identification No.
- --------------------------------------- ---------------- ------------------
Sun International Bahamas Limited
Coral Towers
Paradise Island, The Bahamas Commonwealth of
(242) 363-3000 The Bahamas Not Applicable
Paradise Acquisitions Limited
Coral Towers
Paradise Island, The Bahamas Commonwealth of
(242) 363-3000 The Bahamas Not Applicable
Paradise Island Limited
Coral Towers
Paradise Island, The Bahamas Commonwealth of
(242) 363-3000 The Bahamas Not Applicable
Paradise Enterprises Limited
Coral Towers
Paradise Island, The Bahamas Commonwealth of
(242) 363-3000 The Bahamas Not Applicable
Island Hotel Company Limited
Coral Towers
Paradise Island, The Bahamas Commonwealth of
(242) 363-3000 The Bahamas Not Applicable
Paradise Beach Inn Limited
Coral Towers
Paradise Island, The Bahamas Commonwealth of
(242) 363-3000 The Bahamas Not Applicable
Sun International Management Limited
Coral Towers
Paradise Island, The Bahamas British Virgin
(242) 363-3000 Islands Not Applicable
GGRI, Inc.
1415 E. Sunrise Blvd., 10th Floor
Ft. Lauderdale, FL 33304
(954) 713-2500 Delaware 22-2962648
Resorts International Hotel, Inc.
1415 E. Sunrise Blvd., 10th Floor
Ft. Lauderdale, FL 33304
(954) 713-2500 New Jersey 21-0423320
Sun Cove, Ltd.
1415 E. Sunrise Blvd., 10th Floor
Ft. Lauderdale, FL 33304
(954) 713-2500 Connecticut 36-4041616
<PAGE>
PROSPECTUS
Sun International Hotels Limited
Sun International North America, Inc.
Debt Securities
Sun International Hotels Limited (the "Company") and Sun International
North America, Inc., a wholly owned subsidiary of the Company ("SINA" and,
together with the Company, the "Issuers"), intend from time to time to issue, as
joint and several obligors, in one or more series, up to an aggregate of $300
million of their debt securities (the "Debt Securities"), which may be either
senior or subordinated in priority of payment and which may or may not be
guaranteed by certain direct and indirect subsidiaries of the Company (the
"Guarantors").
When a particular series of Debt Securities is offered, a supplement to
this Prospectus (the "Prospectus Supplement") will be delivered with the
Prospectus. The Prospectus Supplement will set forth with respect to such
series: whether it is a series of senior or subordinated Debt Securities; the
terms for the guarantees (the "Guarantees") provided by the Guarantors, if any;
the designation and principal amount offered; the rate (or method of
calculation) and time of payment of interest, if any; the authorized
denominations; the maturity or maturities; the terms for a sinking, purchase or
analogous fund, if any; the terms for redemption or early repayment, if any; the
currency or currencies or currency unit or currency units in which principal,
premium, if any, or interest, if any, is payable; the purchase price and other
terms of the offering; and any listing on a securities exchange.
The Debt Securities may be sold (i) through underwriting syndicates
represented by managing underwriters or by underwriters without a syndicate,
(ii) through agents designated from time to time or (iii) directly. The names of
any underwriters or agents of the Issuers involved in the sale of the Debt
Securities in respect of which this Prospectus is being delivered and any
applicable commissions or discounts are set forth in the Prospectus Supplement.
The net proceeds to the Issuers from such sale are also set forth in the
Prospectus Supplement.
---------------------------
THIS PROSPECTUS MAY NOT BE USED TO CONSUMMATE SALES OF DEBT SECURITIES UNLESS
ACCOMPANIED BY A PROSPECTUS SUPPLEMENT.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION
PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
NO GAMING REGULATORY AUTHORITY HAS PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS OR THE INVESTMENT MERITS OF THE
SECURITIES OFFERED HEREBY. ANY REPRESENTATION TO THE
CONTRARY IS UNLAWFUL.
---------------------------
The date of this Prospectus is December 3, 1997.
1
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No person has been authorized to give any information or to make any
representations with respect to the matters described in this Prospectus or any
accompanying Prospectus Supplement other than those contained or incorporated by
reference herein, and, if given or made, such information or representations
must not be relied upon as having been authorized by the Issuers. This
Prospectus and any accompanying Prospectus Supplement do not constitute an offer
to sell or the solicitation of an offer to buy any securities in any
jurisdiction to or from any person to whom it is unlawful to make any such offer
or solicitation in such jurisdiction. Neither the delivery of this Prospectus or
any accompanying Prospectus Supplement nor any distribution of securities
thereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the Issuers since the date hereof or thereof or
that the information contained herein and therein is correct as of any time
subsequent to such date.
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), applicable to foreign
issuers, and in accordance therewith files reports, including annual reports on
Form 20-F, and other information with the Securities and Exchange Commission
(the "Commission"). The Company makes available to its shareholders annual
reports containing audited financial statements within 105 days of the end of
each fiscal year and publishes quarterly reports containing selected financial
data for the first three quarters of the fiscal year within 60 days from the end
of such fiscal quarter (in each case, prepared in accordance with generally
accepted accounting principals in the United States ("GAAP")). The Company is
exempt from the rules under the Exchange Act prescribing the furnishing and
content of proxy statements to shareholders. However, the Company furnishes
shareholders with statements with respect to annual or extraordinary meetings of
shareholders, as well as such other reports as may from time to time be
authorized by the Board of Directors or be required under law. SINA is subject
to the informational requirements of the Exchange Act , and in accordance
therewith files reports and other information with the Commission. Such reports,
and other information of the Company and SINA may be inspected and copied at the
public reference facilities maintained by the Commission at Room 1024, Judiciary
Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549 and at the following
Regional Offices of the Commission: Citicorp Center, 500 West Madison Street,
Suite 1400, Chicago, Illinois 60661; and 7 World Trade Center, 13th Floor, New
York, New York 10048. Copies of such material may be obtained from the Public
Reference Section of the Commission, 450 Fifth Street, N.W., Washington, D.C.
20549 at prescribed rates. The Commission also maintains a Web site at
http://www.sec.gov that contains reports, proxy and information statements and
other information regarding registrants that file electronically with the
Commission. Copies of such materials filed by the Company can also be inspected
at the offices of the New York Stock Exchange, Inc. ("NYSE"), 20 Broad Street,
New York, New York 10005, on which the ordinary shares of the Company are
listed. Copies of such materials filed by SINA can also be inspected at the
offices of the American Stock Exchange, Inc. ("AMEX"), 86 Trinity Plaza, New
York, New York 10006, on which certain notes of SINA are listed.
A registration statement on Form F-3 (together with all amendments and
exhibits, the "Registration Statement") has been filed with the Commission under
the Securities Act of 1933, as amended (the "Securities Act"), with respect to
the Debt Securities offered hereby. This Prospectus, which constitutes a part of
the Registration Statement, does not contain all the information set forth in
the Registration Statement, certain items of which are contained in exhibits to
the Registration Statement as permitted by the rules and regulations of the
Commission. Statements made in this Prospectus as to the content of any
contract, agreement or other document referred to are not necessarily complete.
With respect to each such contract, agreement or other document filed as an
exhibit to the Registration Statement, reference is made to the exhibit for a
more complete description of the matter involved, and each such statement shall
be deemed qualified in its entirety by such reference.
ENFORCEABILITY OF CIVIL LIABILITIES
The Company is a Bahamian international business company incorporated under
the International Business Companies Act, 1989 of the Commonwealth of The
Bahamas (the "Companies Act"). Certain of the directors and executive officers
of the Company reside outside the United States. A substantial portion of the
assets of such persons and of the Company is located outside the United States.
As a result, in the opinion of Giselle M. Pyfrom, Esq., Bahamian counsel to the
Company, it may be difficult or impossible to effect service of process within
the United States upon such persons, to bring suit in the United States or to
enforce, in the U.S. courts, any judgment obtained there against such persons
predicated upon any civil liability provisions of the U.S. federal securities
laws. It is unlikely that Bahamian courts would entertain original actions
against Bahamian companies, their directors or officers predicated solely upon
U.S. federal securities laws. Furthermore, judgments predicated upon any civil
liability provisions of the U.S. federal securities laws are not directly
enforceable in The Bahamas. Rather, a lawsuit must be brought in The Bahamas on
any such judgment. Subject to consideration of private international law, in
general, a judgment obtained after due trial by a court of competent
jurisdiction, which is final and conclusive as to the issues in contention, is
actionable in Bahamian courts and is impeachable only upon the grounds of (i)
fraud, (ii) public policy and (iii) natural justice.
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INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE
The following documents heretofore filed by the Company (File No. 1-4226)
with the Commission pursuant to the Exchange Act are incorporated herein by
reference:
1. The Company's Annual Report on Form 20-F for the year ended
December 31, 1996;
2. The Company's Current Reports on Form 6-K, dated February 10,
1997, March 11, 1997 and November 24, 1997 (which contains the
unaudited financial statements of the Company for the nine
month period ending September 30, 1997); and
3. The Company's Current Reports on Form 6-K/A, dated February
27, 1997 and November 24, 1997.
The following documents heretofore filed by SINA (File No. 1-4748) with the
Commission pursuant to the Exchange Act are incorporated herein by reference:
1. SINA's Annual Report on Form 10-K for the year ended December
31, 1996;
2. SINA's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1997, June 30, 1997 and September 30 , 1997; and
3. SINA's Current Report on Form 8-K, dated August 12, 1997, as
amended by SINA's Current Report on Form 8-K/A, dated August
20, 1997.
Any statement contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be modified or superseded
for purposes of this Prospectus to the extent that a statement contained herein,
or in any other subsequently filed document which also is incorporated or deemed
to be incorporated by reference herein or in any Prospectus Supplement, modifies
or supersedes such statement. Any statement so modified or superseded shall not
be deemed, except as so modified or superseded, to constitute a part of this
Prospectus. In addition, (i) all annual reports on Form 20-F filed by the
Company and, to the extent designated therein, any reports on Form 6-K filed by
the Company pursuant to Section 13(a), 13(c) or 15(d) of the Exchange Act and
(ii) all documents filed by SINA pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act after the date of this Prospectus and prior to the
termination of the offering of the Debt Securities shall be deemed to be
incorporated by reference into this Prospectus and to be a part hereof from the
date of filing of such documents or reports, to the extent not superseded by
documents or reports subsequently filed.
Each of the Issuers undertakes to provide, without charge, to each person,
including any beneficial owner, to whom this Prospectus is delivered, upon the
written or oral request of such person, a copy of any and all of the documents
incorporated herein by reference (other than exhibits to such documents unless
such exhibits are specifically incorporated by reference herein). Requests for
such documents should be directed to the Secretary, Sun International Hotels
Limited, Coral Towers, The Bahamas. Telephone requests for such copies should be
directed to the Secretary at (242) 363-3000.
THE ISSUERS
The Company is an international resort and gaming company which develops
and manages premier resort and casino properties. The Company currently operates
resort hotels and casinos in The Bahamas, Connecticut, New Jersey and the Indian
Ocean. SINA, which is a wholly owned subsidiary of the Company, operates the
Company's resort hotel and casino properties in Atlantic City, New Jersey.
The Company's principal executive offices are located at Coral Towers,
Paradise Island, The Bahamas, and its telephone number is (242) 363-3000. SINA's
principal executive offices are located at 1415 East Sunrise Boulevard, 10th
Floor, Fort Lauderdale, Florida, 33304, and its telephone number is (954)
713-2500.
USE OF PROCEEDS
Unless otherwise indicated in the applicable Prospectus Supplement, the
Issuers intend to use the net proceeds from the sale of the Debt Securities for
general corporate purposes.
The Issuers expect that they will, on a recurring basis, engage in
additional financings in character and amount to be determined as the need
arises.
3
<PAGE>
RATIO OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratio of earnings to fixed charges for
the Company for the periods indicated. For the purposes of computing the ratio
of earnings to fixed charges, (i) earnings represent income (loss) from
continuing operations before income taxes plus fixed charges exclusive of
capitalized interest and (ii) fixed charges consist of interest, whether
expensed or capitalized, and amortization of deferred financing fees.
<TABLE>
<CAPTION>
Nine Months
Ended
September 30, Year Ended December 31, (1)
--------------- -----------------------------------------------
1997 1996 1996 1995
---- ---- ---- ----
<S> <C> <C> <C> <C>
Ratio of earnings to fixed charges........ 4.27x 12.67x 13.53x 2.85x
Deficiency ($ thousands) ................. N/A N/A N/A N/A
- --------------
(1) Because the Company commenced operations in 1994, the earnings data for such
period is not comparable to the earnings data for future periods.
</TABLE>
The following table sets forth the ratio of earnings to fixed charges for
SINA for the periods indicated. For the purposes of computing the ratio of
earnings to fixed charges, (i) earnings represent income (loss) from
continuing operations before income taxes plus fixed charges exclusive of
capitalized interest and (ii) fixed charges consist of interest, whether
expensed or capitalized, and amortization of deferred financing fees.
<TABLE>
<CAPTION>
Nine Months
Ended
September 30, Year Ended December 31,
--------------- -----------------------------------------------
1997 1996 1996 1995 1994 1993 1992
---- ---- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C> <C>
Ratio of earnings to fixed charges........ 1.50x 1.21x N/A 1.53x N/A N/A N/A
Deficiency ($ thousands) ................. N/A N/A (714) N/A (98,891) (101,164) (54,802)
</TABLE>
DESCRIPTION OF THE DEBT SECURITIES
The following description of the terms of the Debt Securities sets forth
certain general terms and provisions of the Debt Securities to which any
Prospectus Supplement may relate. The particular terms of the Debt Securities
offered by any Prospectus Supplement and the extent to which such general
provisions may apply to the Debt Securities will be described in a Prospectus
Supplement relating to such Debt Securities.
The Debt Securities may constitute either senior or subordinated debt, or
any combination thereof, of the Issuers. Debt Securities and the Guarantees, if
any, will be issued under an indenture (the "Indenture") to be entered into by
the Issuers, the Guarantors named therein and the trustee named in the
applicable Prospectus Supplement (the "Trustee"). A copy of the form of
Indenture has been filed as an exhibit to the Registration Statement. The
following discussion of certain provisions of the Indenture does not purport to
be complete and is subject to, and is qualified in its entirety by reference to,
all the provisions of the Indenture.
General
The Indenture does not limit the aggregate principal amount of Debt
Securities which may be issued thereunder. Debt Securities may be issued
thereunder from time to time as a single series or in two or more separate
series up to the aggregate principal amount from time to time authorized by the
Issuers for each series. As of the date of this Prospectus, the Issuers have
authorized the issuance under the Indenture of Debt Securities, the aggregate
initial offering price of which (represented by the aggregate principal amount
of Debt Securities issued at their principal amount or the issue price of Debt
Securities issued at an original issue discount) does not exceed $300 million.
Each series of Debt Securities will be denominated in United States dollars
unless otherwise provided in the Prospectus Supplement relating thereto. The
Debt Securities will be issued in denominations of $1,000 and integral multiples
thereof unless otherwise provided in the Prospectus Supplement relating thereto.
The applicable Prospectus Supplement will describe, among other things, the
following terms of the series of Debt Securities with respect to which such
Prospectus Supplement is being delivered: (i) the title of the Debt Securities
of such series and, if other than denominations of $1,000 and any integral
multiple thereof, the denominations in which any Debt Securities of such series
shall be issuable; (ii) any limit on the aggregate principal amount of the Debt
Securities of such series and any provisions relating to the seniority or
subordination of all or any portion of the indebtedness evidenced thereby to
other indebtedness of the Issuers; (iii) the price or prices (expressed as a
percentage of the respective aggregate principal amount thereof) at which the
Debt Securities of such series will be issued; (iv) the date or dates on which
the principal of the Debt Securities of such series is payable or the method of
determination thereof; (v) the rate or rates (which may be fixed or variable) at
which the Debt Securities of such series will bear interest (which rate may be
zero in the case of certain Debt Securities issued at an issue price
representing a discount from the principal amount payable at maturity), the date
or dates from which such interest, if any, will accrue and the circumstances, if
any, in which the Issuers may defer interest payments; (vi) the interest payment
dates, if any, on which any interest on the Debt Securities of such series will
be payable, the record date for any interest payable on any Debt Securities of
such series and the person to whom interest shall be payable if other than the
person in whose name the Debt Security of such series is registered at the close
of business on the record date for such interest; (vii) the place or places
where principal of, premium, if any, and interest on the Debt Securities of such
series
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<PAGE>
shall be payable; (viii) the terms applicable to any "original issue discount"
(as defined in the Internal Revenue Code of 1986, as amended, and the
regulations thereunder), including the rate or rates at which such original
issue discount shall accrue; (ix) the right or obligation, if any, of the
Issuers to redeem or purchase Debt Securities of such series pursuant to any
sinking fund or analogous provisions or at the option of a holder thereof, or
otherwise, the conditions, if any, giving rise to such right or obligation and
the period or periods within which, and the price or prices at which and the
terms and conditions upon which, Debt Securities of such series shall be
redeemed or purchased, in whole or in part, and any provisions for the marketing
of such Debt Securities of such series; (x) if the amount of payments of
principal of, premium, if any, and interest, if any, on the Debt Securities of
such series is to be determined by reference to an index, formula or other
method, the manner in which such amounts are to be determined and the
calculation agent, if any, with respect thereto; (xi) if other than the
principal amount thereof, the portion of the principal amount of the Debt
Securities of such series which will be payable upon declaration or acceleration
of the stated maturity thereof pursuant to an Event of Default; (xii) whether
the Debt Securities of such series will be issued in certificated or book-entry
form and, if applicable, the identity of the depositary for the Debt Securities
of such series; (xiii) any listing of the Debt Securities of such series on a
securities exchange; (xiv) any restrictive covenants included for the benefit of
holders of the Debt Securities of such series; (xv) any additional events of
default provided with respect to the Debt Securities of such series; (xvi) the
terms, if any, on which the Debt Securities of such series will be convertible
into or exchangeable for other debt or equity securities; (xvii) the collateral,
if any, securing payments with respect to the Debt Securities of such series and
any provisions relating thereto; (xviii) whether the Debt Securities of such
series are to be guaranteed and, if so, the identity of the Guarantors and the
terms of the Guarantees; and (xix) any other material terms of the Debt
Securities of such series.
Registered Global Securities
The registered Debt Securities of a series may be issued in the form of one
or more fully registered global securities (a "Global Security") that will be
deposited with a depositary (the "Depositary") or its nominee identified in the
Prospectus Supplement relating to such series. In such case, one or more
registered Global Securities will be issued, each in a denomination equal to the
portion of the aggregate principal amount of outstanding registered Debt
Securities of the series to be represented by such registered Global Security.
Unless and until it is exchanged in whole or in part for Debt Securities in
definitive registered form, a registered Global Security may not be transferred
except as a whole by the Depositary for such registered Global Security to a
nominee of such Depositary, or by such a nominee to such Depositary or to
another nominee of such Depositary, or by such Depositary or any such nominee to
a successor Depositary or a nominee of such successor Depositary.
The specific terms of the depositary arrangement with respect to any
portion of a series of Debt Securities to be represented by a registered Global
Security will be described in the Prospectus Supplement relating to such series.
The Issuers anticipate that the following provisions will apply to all
depositary arrangements.
Ownership of beneficial interests in a registered Global Security will be
limited to persons that have accounts with the Depositary for such registered
Global Security (collectively, the "participants") or persons holding interests
through participants. Upon the issuance of a registered Global Security, the
Depositary for such registered Global Security will credit, on its book-entry
registration and transfer system, the participants' accounts with the respective
principal amounts of the Debt Securities represented by such registered Global
Security beneficially owned by such participants. The accounts to be credited
shall be designated by any dealers, underwriters or agents participating in the
distribution of such Debt Securities. Ownership of beneficial interests in such
registered Global Security will be shown on, and the transfer of such ownership
interests will be effected only through, records maintained by the Depositary
for such registered Global Security (with respect to interests of participants)
and on the records of participants (with respect to interests of persons holding
through participants).
So long as the Depositary for a registered Global Security, or its nominee,
is the registered owner of such registered Global Security, such Depositary or
such nominee, as the case may be, will be considered the sole owner or holder of
the Debt Securities represented by such registered Global Security for all
purposes under the Indenture. Except as set forth below, owners of beneficial
interests in a registered Global Security will not be entitled to have the Debt
Securities represented by such registered Global Security registered in their
names, will not receive or be entitled to receive physical delivery of such Debt
Securities in definitive form and will not be considered the owners or holders
thereof under the Indenture.
Principal, premium, if any, and interest payments on Debt Securities
represented by a registered Global Security registered in the name of a
Depositary or its nominee will be made to such Depositary or its nominee, as the
case may be, as the registered owner of such registered Global Security. None of
the Issuers, the Trustee, the Guarantors, if any, or any paying agent for such
Debt Securities will have any responsibility or liability for any aspect of the
records relating to or payments made on account of beneficial ownership
interests in such registered Global Security or for maintaining, supervising or
reviewing any records relating to such beneficial ownership interests.
The Issuers expect that the Depositary for any Debt Securities represented
by a registered Global Security, upon receipt of any payment of principal,
premium or interest in respect of such registered Global Security, will
immediately credit
5
<PAGE>
participants' accounts with payments in amounts proportionate to their
respective beneficial interests in such registered Global Security as shown on
the records of such Depositary. The Issuers also expect that payments by
participants to owners of beneficial interests in such registered Global
Security held through such participants will be governed by standing customer
instructions and customary practices, as is now the case with the securities
held for the accounts of customers in "street name", and will be the
responsibility of such participants.
If the Depositary for any Debt Securities represented by a registered
Global Security is at any time unwilling or unable to continue as Depositary,
and a successor Depositary is not appointed by the Issuers within 90 days, the
Issuers will issue such Debt Securities in definitive form in exchange for such
registered Global Security. In addition, the Issuers may at any time and in
their sole discretion determine not to have any of the Debt Securities of a
series represented by one or more registered Global Securities and, in such
event, will issue Debt Securities of such series in definitive form in exchange
for each registered Global Security representing such Debt Securities.
Subordination
A series of Debt Securities may be subordinated ("Subordinated Debt
Securities") to senior debt to the extent and in the manner set forth in the
Prospectus Supplement relating thereto. In addition, any or all of the following
provisions will apply to such series if the Prospectus Supplement relating
thereto so specifies.
Subordinated Debt Securities of such series and the related Guarantees, if
any, will be general, unsecured obligations of the Issuers and the Guarantors,
if any, respectively, subordinated in right of payment to the prior payment in
full of all Senior Debt of the Issuers and the Guarantors, if any, respectively.
No payment of any kind or character from any source may be made by or on
behalf of the Issuers or a Guarantor, if any, as applicable, on account of the
principal of, premium, if any, or interest or Additional Amounts on such series
of Subordinated Debt Securities (including any repurchases of Subordinated Debt
Securities of such series and rescission payments), or on account of any
redemption provisions of the Subordinated Debt Securities of such series, for
cash or property (other than from the trust described under "--Legal Defeasance
and Covenant Defeasance"), (i) upon the maturity of any Senior Debt of the
Issuers or such Guarantor, if any, by lapse of time, acceleration (unless
waived) or otherwise, unless and until all principal of, premium, if any, the
interest on and any fee or other amount due in respect of such Senior Debt are
first paid in full in cash or Cash Equivalents or otherwise to the extent
holders accept satisfaction of amounts due by settlement in other than cash or
Cash Equivalents, or (ii) in the event of default in the payment of any
principal of, premium, if any, or interest on or any fee or other amount due in
respect of Senior Debt of the Issuers or such Guarantor, if any, when it becomes
due and payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise (a "Payment Default"), unless and until such Payment
Default has been cured or waived or otherwise has ceased to exist.
Upon (i) the happening of an event of default (other than a Payment
Default) that permits the holders of Senior Debt to declare such Senior Debt
to be due and payable and (ii) written notice of such event of default given
to the Trustee by the Representative under the Credit Agreement or the
holders of an aggregate of at least $25 million principal amount outstanding
of any other Senior Debt or their representative (a "Payment Blockage
Notice"), then, unless and until such event of default has been cured or
waived or otherwise has ceased to exist, no payment (by set-off or otherwise)
may be made by or on behalf of the Issuers or any Guarantor which is an
obligor under such Senior Debt on account of the principal of, premium, if
any, or interest or Additional Amounts on the Subordinated Debt Securities of
such series, including any repurchases of Subordinated Debt Securities of
such series and rescission payments, other than payments made from the trust
described under "--Legal Defeasance and Covenant Defeasance"; provided,
however, that so long as the Credit Agreement is in effect, a Payment
Blockage Notice may only be given by the Representative under the Credit
Agreement unless otherwise agreed in writing by the requisite lenders under
the Credit Agreement. Notwithstanding the foregoing, unless the Senior Debt
in respect of which such event of default exists has been declared due and
payable in its entirety within 179 days after the Payment Blockage Notice is
delivered as set forth above (the "Payment Blockage Period") (and such
declaration has not been rescinded or waived), at the end of the Payment
Blockage Period, the Issuers and the Guarantors, if any, shall be required to
pay all sums not paid to the holders of the Subordinated Debt Securities of
such series during the Payment Blockage Period due to the foregoing
prohibitions and to resume all other payments as and when due on the
Subordinated Debt Securities of such series. Any number of Payment Blockage
Notices may be given; provided, however, that (i) not more than one Payment
Blockage Notice shall be given within a period of any 360 consecutive days,
and (ii) no default that existed upon the date of such Payment Blockage
Notice or the commencement of such Payment Blockage Period (whether or not
such event of default is on the same issue of Senior Debt) shall be made the
basis for the commencement of any other Payment Blockage Period, unless such
event of default shall have been cured or waived for a period of not less
than 90 days.
Upon any distribution of assets of either Issuer or any Guarantor, upon
any dissolution, winding up, total or partial liquidation or reorganization
of either Issuer or any Guarantor, whether voluntary or involuntary, in
bankruptcy, insolvency, receivership or a similar proceeding or upon
assignment for the benefit of creditors or any marshaling of assets or
liabilities, (i) the holders of all Senior Debt of such Issuer or such
Guarantor, if any, as applicable, will first be entitled to
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receive payment in full in cash or Cash Equivalents or otherwise to the extent
holders accept satisfaction of amounts due by settlement in other than cash or
Cash Equivalents before the holders of Subordinated Debt Securities of such
series are entitled to receive any payment on account of principal of, premium,
if any, and interest or Additional Amounts on the Subordinated Debt Securities
of such series, including any repurchases of Subordinated Debt Securities of
such series and rescission payments, other than Junior Securities or from the
trust described under "--Legal Defeasance and Covenant Defeasance", and (ii) any
payment or distribution of assets of such Issuer or such Guarantor, if any, of
any kind or character from any source, whether in cash, property or securities,
other than Junior Securities or from the trust described under "--Legal
Defeasance and Covenant Defeasance", to which the holders or the Trustee on
behalf of the holders would be entitled (by set-off or otherwise), except for
the subordination provisions contained in the Indenture, will be paid by the
liquidating trustee or agent or other person making such a payment or
distribution directly to the holders of such Senior Debt or their representative
to the extent necessary to make payment in full in cash or Cash Equivalents on
all such Senior Debt remaining unpaid, after giving effect to any concurrent
payment or distribution to the holders of such Senior Debt.
In the event that, notwithstanding the foregoing, any payment or
distribution of assets (other than, where applicable, Junior Securities or from
the trust described under "--Legal Defeasance and Covenant Defeasance") shall be
received by the Trustee or the holders of Subordinated Debt Securities of such
series at a time when such payment or distribution is prohibited by the
foregoing provisions, such payment or distribution shall be held in trust for
the benefit of the holders of such Senior Debt, and shall be paid or delivered
by the Trustee or such holders, as the case may be, to the holders of such
Senior Debt remaining unpaid or unprovided for or to their representative or
representatives, or to the trustee or trustees under any indenture pursuant to
which any instruments evidencing any of such Senior Debt may have been issued,
ratably according to the aggregate principal amounts remaining unpaid on account
of such Senior Debt held or represented by each, for application to the payment
of all such Senior Debt remaining unpaid, to the extent necessary to pay all
such Senior Debt in full in cash or Cash Equivalents or otherwise to the extent
holders accept satisfaction of amounts due by settlement in other than cash or
Cash Equivalents after giving effect to any concurrent payment or distribution
to the holders of such Senior Debt.
No provision contained in the Indenture or the Subordinated Debt Securities
of such series will affect the obligation of the Issuers and the Guarantors, if
any, which is absolute and unconditional, to pay, when due, principal of,
premium, if any, and interest on the Subordinated Debt Securities of such
series. The subordination provisions of the Indenture and the Subordinated Debt
Securities of such series will not prevent the occurrence of any Default or
Event of Default under the Indenture or limit the rights of the Trustee or any
holder of Subordinated Debt Securities of such series to pursue any other rights
or remedies with respect to the Subordinated Debt Securities of such series.
Optional Redemption
The Issuers will have the right to redeem a series of Debt Securities in
the manner set forth in the Prospectus Supplement relating to such series. In
addition, any or all of the following provisions will apply to such series if
the Prospectus Supplement relating thereto so specifies.
The Issuers will not have the right to redeem any of such series of Debt
Securities prior to the date specified in the applicable Prospectus
Supplement (other than out of the Net Cash Proceeds of a Public Equity
Offering, as described in the next following paragraph, or pursuant to a
Required Regulatory Redemption or an Optional Tax Redemption). Such series of
Debt Securities will be redeemable for cash at the option of the Issuers, in
whole or in part, at any time on or after such date, upon not less than 30
days' nor more than 60 days' notice to each holder of such series of Debt
Securities, at the redemption prices set forth in the applicable Prospectus
Supplement.
On or prior to March 15, 2000, upon a Public Equity Offering of Ordinary
Shares for cash of the Company, up to 35% of the aggregate principal amount of
such series of Debt Securities may be redeemed at the option of the Issuers
within 120 days of such Public Equity Offering, on not less than 30 days', but
not more than 60 days', notice to each holder of such series of Debt Securities
to be redeemed, with cash from the Net Cash Proceeds of such Public Equity
Offering, at 109% of the principal amount thereof (subject to the right of
holders of record on a Record Date to receive interest due on an Interest
Payment Date that is on or prior to such Redemption Date), together with accrued
and unpaid interest to the date of redemption; provided, however, that
immediately following each such redemption not less than 65% of the aggregate
principal amount of such series of Debt Securities are outstanding.
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Required Regulatory Redemption
The Indenture provides that if a holder or a beneficial owner of Debt
Securities is required by any regulatory body responsible for a gaming license
held by the Company or a Subsidiary of the Company (a "Gaming Authority") to be
found suitable to hold Debt Securities, the holder shall apply for a finding of
suitability within 30 days after a Gaming Authority requests or sooner if so
required by such Gaming Authority. The applicant for a finding of suitability
must pay all costs of the investigation for such finding of suitability. If a
holder or beneficial owner is required to be found suitable to hold the Debt
Securities and is not found suitable by a Gaming Authority, the holder shall, to
the extent required by applicable law, dispose of its Debt Securities within 30
days or within that time prescribed by a Gaming Authority, whichever is earlier.
If the holder fails to dispose of its Debt Securities within such time period,
the Issuers may, at their option, redeem the holder's Debt Securities at,
depending on applicable law, (i) the principal amount thereof, together with
accrued and unpaid interest to the date of the finding of unsuitability by a
Gaming Authority, (ii) the amount that such holder paid for the Debt Securities,
(iii) the fair market value of the Debt Securities, (iv) the lowest of clauses
(i), (ii) and (iii), or (v) such other amount as may be determined by the
appropriate Gaming Authority.
Payment of Additional Amounts
The Issuers will be required to pay Additional Amounts on a series of Debt
Securities to the extent and in the manner set forth in the Prospectus
Supplement relating to such series. In addition, any or all of the following
provisions will apply to such series if the Prospectus Supplement relating
thereto so specifies.
The Issuers will, subject to certain limitations and exceptions (as set
forth below), pay to each holder such amounts (the "Additional Amounts") as may
be necessary in order that every net payment or deemed payment of (i) principal,
premium and interest, if any, with respect to a Debt Security of such series, or
(ii) net proceeds on the sale or exchange of a Debt Security of such series,
each after deduction or withholding for or on account of any taxes, duties,
assessments or governmental charges of whatever nature imposed or levied by or
on behalf of the government of The Bahamas or any authority thereof or therein
having power to tax, will result in the receipt by the holders of the amounts
that would have been received by them had no such deduction or withholding been
required; provided, however, that no such Additional Amounts shall be payable in
respect of any Debt Security of such series for:
(1) any tax, duty, assessment, or other governmental charge which would not
have been imposed but for the fact that such holder:
(a) is a resident, domiciliary or national of, or engaged in business
or maintains a permanent establishment or was physically present in, The
Bahamas or any political subdivision thereof or therein or otherwise has
some connection with The Bahamas other than the mere ownership of, or
receipt of payment under, such Debt Security;
(b) presented such Debt Security for payment in The Bahamas or any
political subdivision thereof or therein, unless such Debt Security could
not have been presented for payment elsewhere; or
(c) presented such Debt Security for payment more than 30 days after
the date on which the payment in respect of such Debt Security became due
and payable or provided for, whichever is later, except to the extent that
the holder would have been entitled to such Additional Amounts if it had
presented such Debt Security for payment on any day within such period of
30 days;
(2) any estate, inheritance, gift, sales, transfer or similar tax,
assessment or other governmental charge or any taxes, duties, assessments or
other governmental charges that are payable otherwise than by deduction or
withholding from payments on such Debt Security;
(3) any tax, duty, assessment or other governmental charge imposed on a
holder that is not the beneficial owner of a Debt Security of such series to the
extent that the beneficial owner would not have been entitled to the payment of
Additional Amounts had the beneficial owner directly held such Debt Security; or
(4) any combination of items (1), (2) and (3).
Whenever there is mentioned, in any context, the payment of the principal
of or any premium or interest on, or in respect of, any Debt Securities of such
series or the net proceeds received on the sale or exchange of any Debt
Securities of such series, such mention shall be deemed to include mention of
the payment of Additional Amounts provided for in the Indenture to the extent
that, in such context, Additional Amounts are, were or would be payable in
respect thereof pursuant to the Indenture.
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Without limiting a holder's right to receive payment of Additional Amounts,
in the event that Additional Amounts actually paid with respect to the Debt
Securities of such series are based on rates of deduction or withholding of
Bahamian taxes in excess of the appropriate rate applicable to the holder of
such Debt Securities and, as a result thereof, such holder is entitled to make a
claim for a refund or credit of such excess, then such holder shall, by
accepting the Debt Securities of such series and receiving a payment of
Additional Amounts, be deemed to have assigned and transferred all right, title
and interest to any such claim for a refund or credit of such excess to the
Issuers. By making such assignment, the holder of Debt Securities of such series
makes no representation or warranty that the Issuers will be entitled to receive
such claim for a refund or credit and incurs no other obligation with respect
thereto.
Optional Tax Redemption
With respect to a series of Debt Securities, the Debt Securities of such
series may be redeemed at the option of the Issuers, in whole but not in part,
upon not less than 30 nor more than 60 days' notice given as provided in the
Indenture, at any time at a redemption price equal to the principal amount
thereof, plus accrued and unpaid interest, if any, thereon, to the date fixed
for redemption if, as a result of any change in or amendment to the laws,
treaties, rulings or regulations of The Bahamas, or of any political subdivision
or taxing authority thereof or therein, or any change in the official position
of the applicable taxing authority regarding the application or interpretation
of such laws, treaties, rulings or regulations (including a holding judgment or
order of a court of competent jurisdiction) or any execution thereof or
amendment thereto, which is enacted into law or otherwise becomes effective
after the Issue Date of such series of Debt Securities, either Issuer would be
required on the next succeeding interest payment date to pay Additional Amounts
on the Debt Securities of such series as a result of the imposition of a
Bahamian withholding tax and the payment of such Additional Amounts cannot be
avoided by the use of any reasonable measures available to the Issuers which do
not cause the Issuers to incur any material costs. The Issuers shall also pay to
holders on the redemption date any Additional Amounts then due and which will
become due as a result of the redemption or would otherwise be payable.
Prior to the publication of any notice of redemption in accordance with
the foregoing, the Issuers shall deliver to the Trustee an officers'
certificate stating that (i) the payment of Additional Amounts cannot be
avoided by the use of any reasonable measures available to the Issuers which
do not cause the Issuers to incur any material costs and (ii) the Issuers are
entitled to effect such redemption based on the written, substantially
unqualified opinion of counsel, which counsel shall be reasonably acceptable
to the Trustee, that the Issuers have or will become obligated to pay
Additional Amounts as a result of such change or amendment. The notice, once
delivered by the Issuers to the Trustee, will be irrevocable.
Selection and Notice
Certain selection and notice provisions relating to redemptions of a series
of Debt Securities will apply to such series to the extent and in the manner set
forth in the Prospectus Supplement relating thereto. In addition, any or all of
the following provisions will apply to such series if the Prospectus Supplement
relating thereto so specifies.
In the case of a partial redemption (other than a Required Regulatory
Redemption), the Trustee shall select the Debt Securities of such series or
portions thereof for redemption on a pro rata basis, by lot or in such other
manner it deems appropriate and fair. The Debt Securities of such series may be
redeemed in part in multiples of $1,000 only.
The Debt Securities of such series will not have the benefit of any sinking
fund.
Except as required by a Gaming Authority with respect to a Required
Regulatory Redemption, notice of any redemption will be sent, by first-class
mail, at least 30 days and not more than 60 days prior to the date fixed for
redemption to the holder of each Debt Security of such series to be redeemed to
such holder's last address as then shown upon the registry books of the
Registrar. Any notice which relates to a Debt Security of such series to be
redeemed in part only must state the portion of the principal amount equal to
the unredeemed portion thereof and must state that on and after the date of
redemption, upon surrender of such Debt Security of such series, a new Debt
Security or new Debt Securities of such series in a principal amount equal to
the unredeemed portion thereof will be issued. On and after the date of
redemption, interest will cease to accrue on the Debt Securities of such series
or portions thereof called for redemption, unless the Issuers default in the
payment thereof.
Certain Covenants
With respect to a series of Debt Securities, the Issuers and the
Guarantors, if any, will be subject to certain covenants and agreements to the
extent and in the manner set forth in the Prospectus Supplement relating to such
series. In addition, any or all of the following provisions will apply to such
series if the Prospectus Supplement relating thereto so specifies.
Suspended Covenants
During any period of time that (i) such series of Debt Securities have
Investment Grade Status and (ii) no Default or Event of Default has occurred
and is continuing under the Indenture with respect to such series of Debt
Securities, the Issuers and their Subsidiaries will not be subject to the
provisions of the Indenture with respect to such series of Debt Securities
described below under "--Limitation on Incurrence of Additional Indebtedness
and Disqualified Capital Stock", "--Limitation on Restricted Payments" and
"--Limitation on Sale of Assets and Subsidiary Stock", in each case, to the
extent applicable (collectively, the "Suspended Covenants"). In the event
that the Issuers and their Subsidiaries are not subject to the Suspended
Covenants with
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respect to such series of Debt Securities for any period of time as a result of
the preceding sentence and, subsequently, either of the Rating Agencies
withdraws its rating or assigns such series of Debt Securities a rating below
the required Investment Grade Ratings, then the Issuers and their Subsidiaries
will thereafter again be subject to the Suspended Covenants for the benefit of
such series of Debt Securities and compliance with the Suspended Covenant with
respect to Restricted Payments made after the time of such withdrawal or
assignment will be calculated in accordance with the terms of the covenant
described below under "--Limitation on Restricted Payments" as if such covenant
had been in effect during the entire period of time from the Issue Date of such
series of Debt Securities.
Repurchase of Debt Securities at the Option of the Holder Upon a Change of
Control
In the event that a Change of Control Triggering Event has occurred, each
holder of such series of Debt Securities will have the right, at such holder's
option, pursuant to an irrevocable and unconditional offer by the Issuers (the
"Change of Control Offer"), to require the Issuers to repurchase all or any part
of such holder's Debt Securities (provided, that the principal amount of such
Debt Securities must be $1,000 or an integral multiple thereof) on a date (the
"Change of Control Purchase Date") that is no later than 45 Business Days after
the occurrence of such Change of Control Triggering Event, at a cash price equal
to 101% of the principal amount thereof (the "Change of Control Purchase
Price"), together with accrued and unpaid interest to the Change of Control
Purchase Date. The Change of Control Offer shall be made within 20 Business Days
following a Change of Control Triggering Event and shall remain open for at
least 20 Business Days following its commencement (the "Change of Control Offer
Period"). Upon expiration of the Change of Control Offer Period the Issuers
promptly shall purchase all such series of Debt Securities properly tendered in
response to the Change of Control Offer.
As used herein, a "Change of Control Triggering Event" shall be deemed
to occur with respect to a series of Debt Securities if either of the Rating
Agencies shall downgrade or withdraw their rating of such series of Debt
Securities as a result of or, in any case, within 90 days of, a Change of
Control. A "Change of Control" means (i) the Company ceases to be the
"beneficial owner," directly or indirectly, of 100% of the Equity Interests
of SINA; (ii) any sale, transfer or other conveyance, whether direct or
indirect, of all or substantially all of the assets, on a consolidated basis,
of the Company or SINA, in one transaction or a series of related
transactions (in each case other than to a person that is a Permitted
Holder); (iii) any merger or consolidation of the Company with or into any
person if, immediately after giving effect to such transaction, any "person"
or "group" (as such terms are used for purposes of Sections 13(d) and 14(d)
of the Exchange Act, whether or not applicable) (other than a Permitted
Holder) is or becomes the "beneficial owner", directly or indirectly, of more
than 50% of the total voting power in the aggregate normally entitled to vote
in the election of directors, managers, or trustees, as applicable, of the
surviving entity or entities; (iv) any "person" or "group" (as such terms are
used for purposes of Sections 13(d) and 14(d) of the Exchange Act, whether or
not applicable) (other than a Permitted Holder) is or becomes the "beneficial
owner", directly or indirectly, of more than 50% of the total voting power in
the aggregate of all classes of Capital Stock of the Company then outstanding
normally entitled to vote in elections of directors; (v) during any period of
12 consecutive months after the Issue Date of such series of Debt Securities,
individuals who at the beginning of any such 12-month period constituted the
Board of Directors of the Company or SINA (together with any new directors
whose election by such Board or whose nomination for election by the
shareholders of the Company or SINA, as applicable, 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 or SINA then in office; or (vi) the
adoption of a plan relating to the liquidation or dissolution of either of
the Issuers.
On or before the Change of Control Purchase Date, the Issuers will (i)
accept for payment such series of Debt Securities or portions thereof properly
tendered pursuant to the Change of Control Offer, (ii) deposit with the Paying
Agent cash sufficient to pay the Change of Control Purchase Price (together with
accrued and unpaid interest) of all Debt Securities of such series so tendered
and (iii) deliver to the Trustee Debt Securities of such series so accepted
together with an officers' certificate listing Debt Securities of such series or
portions thereof being purchased by the Issuers. The Paying Agent promptly will
pay the holders of Debt Securities of such series so accepted an amount equal to
the Change of Control Purchase Price (together with accrued and unpaid
interest), and the Trustee promptly will authenticate and deliver to such
holders a new Debt Securities of such series equal in principal amount to any
unpurchased portion of the Debt Securities of such series surrendered. Any Debt
Securities of such series not so accepted will be delivered promptly by the
Issuers to the holder thereof. The Issuers publicly will announce the results of
the Change of Control Offer on or as soon as practicable after the Change of
Control Purchase Date.
Limitation on Incurrence of Additional Indebtedness and Disqualified
Capital Stock
Except as set forth below in this covenant, the Issuers and the Guarantors,
if any, will not, and will not permit any of their Subsidiaries to, individually
or collectively, directly or indirectly, issue, assume, guaranty, incur, become
directly or indirectly liable with respect to (including as a result of an
Acquisition), or otherwise become responsible for, contingently or otherwise
(individually and collectively, to "incur" or, as appropriate, an "incurrence"),
any Indebtedness or any Disqualified Capital Stock (including Acquired
Indebtedness), except Permitted Indebtedness. Notwithstanding the foregoing, if
(i) no Event of Default shall have occurred and be continuing at the time of, or
would occur after giving effect on a pro forma basis to, such
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incurrence of Indebtedness or Disqualified Capital Stock and (ii) on the date of
such incurrence (the "Incurrence Date"), the Consolidated Coverage Ratio of the
Company for the Reference Period immediately preceding the Incurrence Date,
after giving effect on a pro forma basis to such incurrence of such Indebtedness
or Disqualified Capital Stock and, to the extent set forth in the definition of
Consolidated Coverage Ratio, the use of proceeds thereof, would be at least 2.0
to 1 (the "Debt Incurrence Ratio"), then the Issuers and the Guarantors, if any,
may incur such Indebtedness or Disqualified Capital Stock.
Acquired Indebtedness shall be deemed to have been incurred at the time the
person who incurred such Indebtedness becomes a Subsidiary of either of the
Issuers (including upon designation of any Unrestricted Subsidiary or other
person as a Subsidiary) or is merged with or into or consolidated with either of
the Issuers or a Subsidiary of either of the Issuers, as applicable.
Limitation on Restricted Payments
The Issuers and the Guarantors, if any, will not, and will not permit
any of their Subsidiaries to, individually or collectively, directly or
indirectly, make any Restricted Payment if, after giving effect to such
Restricted Payment on a pro forma basis, (i) a Default or an Event of Default
shall have occurred and be continuing, (ii) the Company is not permitted to
incur at least $1.00 of additional Indebtedness pursuant to the Debt
Incurrence Ratio in the covenant "Limitation on Incurrence of Additional
Indebtedness and Disqualified Capital Stock", (to the extent applicable) or
(iii) the aggregate amount of all Restricted Payments made by the Company and
its Subsidiaries, including after giving effect to such proposed Restricted
Payment, from and after the Issue Date of such series of Debt Securities,
would exceed the sum of (a) 50% of the aggregate Consolidated Net Income of
the Company for the period (taken as one accounting period), commencing
January 1, 1996 to and including the last day of the fiscal quarter ended
immediately prior to the date of each such calculation (or, in the event
Consolidated Net Income for such period is a deficit, then minus 100% of such
deficit) (not giving any pro forma effect to the acquisition of Griffin
Gaming & Entertainment, Inc. for periods prior to its consummation), plus (b)
the aggregate Net Cash Proceeds received by the Company from the sale of its
Qualified Capital Stock (other than (i) to a Subsidiary of the Company and
(ii) to the extent applied in connection with a Qualified Exchange) after the
Issue Date of such series of Debt Securities, plus (c) $50 million.
The immediately preceding paragraph, however, will not prohibit (x) a
Qualified Exchange, (y) the payment of any dividend on Capital Stock within 60
days after the date of its declaration if such dividend could have been made on
the date of such declaration in compliance with the foregoing provisions and (z)
the redemption or repurchase of any Capital Stock or Indebtedness of the Issuers
or their Subsidiaries (other Capital Stock or Indebtedness held by Sun
International Investment Limited, its shareholders or Permitted Holders), if the
holder or beneficial owner of such Capital Stock or Indebtedness is required to
be found suitable by any Gaming Authority to own or vote any such security and
is found unsuitable by any such Gaming Authority to so own or vote such
security. The full amount of any Restricted Payment made pursuant to the
foregoing clauses (y) and (z) (but not pursuant to clause (x)) of the
immediately preceding sentence, however, will be deducted in the calculation of
the aggregate amount of Restricted Payments available to be made referred to in
clause (iii) of the immediately preceding paragraph.
Limitation on Dividends and Other Payment Restrictions Affecting
Subsidiaries
The Issuers and Guarantors, if any, will not, and will not permit any of
their Subsidiaries to, individually or collectively, directly or indirectly,
create, assume or suffer to exist any consensual restriction on the ability of
any Subsidiary of the Company, SINA or such Guarantors, if any, to pay dividends
or make other distributions to or on behalf of, or to pay any obligation to or
on behalf of, or otherwise to transfer assets or property to or on behalf of, or
make or pay loans or advances to or on behalf of, the Company, SINA, the
Guarantors, if any, or any Subsidiary of any of them, or to guaranty such series
of Debt Securities, except (a) restrictions imposed by such series of Debt
Securities or the Indenture, (b) restrictions imposed by applicable law, (c)
existing restrictions under specified Indebtedness outstanding on the Issue Date
of such series of Debt Securities, (d) restrictions under any Acquired
Indebtedness not incurred in violation of the Indenture or any agreement
relating to any property, asset, or business acquired by the Company or any of
its Subsidiaries, which restrictions in each case existed at the time of
acquisition, were not put in place in connection with or in anticipation of such
acquisition and are not applicable to any person, other than the person
acquired, or to any property, asset or business, other than the property, assets
and business so acquired, (e) any such restriction or requirement imposed by
Indebtedness incurred under paragraph (a) of the definition of "Permitted
Indebtedness", provided such restriction or requirement is no more restrictive
than that imposed by the Credit Agreement as of the Issue Date of such series of
Debt Securities, (f) restrictions with respect solely to a Subsidiary of the
Company imposed pursuant to a binding agreement that has been entered into for
the sale or disposition of all or substantially all of the Equity Interests or
assets of such Subsidiary, provided such restrictions apply solely to the Equity
Interests or assets of such Subsidiary that are being sold, (g) restrictions on
transfer contained in FF&E Indebtedness incurred pursuant to paragraph (c) of
the definition of "Permitted Indebtedness", provided such restrictions relate
only to the transfer of the property acquired with the proceeds of such FF&E
Indebtedness, and (h) in connection with and pursuant to Permitted Refinancings,
replacements of restrictions imposed pursuant to clauses (a), (c) or (d) of this
paragraph that are not more restrictive than those being replaced and do not
apply to any other person or assets than those that would have been covered by
the restrictions in the Indebtedness so refinanced. Notwithstanding the
foregoing, neither (a) customary
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provisions restricting subletting or assignment of any lease, license or
contract entered into in the ordinary course of business, consistent with
industry practice, nor (b) Liens permitted under the terms of the Indenture
shall in and of themselves be considered a restriction on the ability of the
applicable Subsidiary to transfer such agreement or assets, as the case may be.
Limitation on Layering Indebtedness
The Issuers and the Guarantors, if any, will not, individually or
collectively, directly or indirectly, incur, or suffer to exist any Indebtedness
that is subordinate in right of payment to any other Indebtedness of either
Issuer or any Guarantor, if any, unless, by its terms, such Indebtedness is
subordinate in right of payment to, or ranks pari passu with, such series of
Debt Securities or the Guarantee, if any, as applicable.
Limitation on Liens Securing Indebtedness
The Issuers and the Guarantors, if any, will not, and will not permit any
of their Subsidiaries to, individually or collectively, create, incur, assume or
suffer to exist any Lien of any kind, other than Permitted Liens, upon any of
their respective assets now owned or acquired on or after the Issue Date of such
series of Debt Securities or upon any income or profits therefrom securing any
Indebtedness of the Issuers, the Guarantors, if any, or any of their
Subsidiaries other than Senior Debt, unless the Issuers and Guarantors, if any,
each provide, and cause their Subsidiaries to provide, concurrently therewith,
that such series of Debt Securities are equally and ratably so secured, provided
that, if such Indebtedness is Subordinated Indebtedness, the Lien securing such
Subordinated Indebtedness shall be subordinate and junior to the Lien securing
such series of Debt Securities with the same relative priority as such
Subordinated Indebtedness shall have with respect to such series of Debt
Securities.
Limitation on Sale of Assets and Subsidiary Stock
The Issuers and the Guarantors, if any, will not, and will not permit
any of their Subsidiaries to, individually or collectively, in one of a
series of related transactions, convey, sell, transfer, assign or otherwise
dispose of, directly or indirectly, any of its property, business or assets,
including by merger or consolidation (in the case of a Guarantor, if any, or
a Subsidiary of the Company or SINA), and including any sale or other
transfer or issuance of any Equity Interests of any Subsidiary of the Company
or SINA, whether by the Company, SINA or a Subsidiary of either or through
the issuance, sale or transfer of Equity Interests by a Subsidiary of the
Company or SINA, and including any sale and leaseback transaction (an "Asset
Sale"), unless (i)(a) within 360 days after the date of such Asset Sale, the
Net Cash Proceeds therefrom (the "Asset Sale Offer Amount") are applied to
the optional redemption of such series of Debt Securities and all other
outstanding Debt Securities in accordance with the terms of the Indenture or
to the repurchase of such series of Debt Securities and all other outstanding
Debt Securities pursuant to an irrevocable, unconditional cash offer (the
"Asset Sale Offer") to repurchase Debt Securities of such series and all
other outstanding Debt Securities at a purchase price of 100% of principal
amount (the "Asset Sale Offer Price") together with accrued and unpaid
interest to the date of payment, made within 330 days of such Asset Sale or
(b) within 330 days following such Asset Sale, the Asset Sale Offer Amount is
(1) invested in assets and property (other than notes, bonds, obligation and
securities) which in the good faith judgment of the Board of Directors of the
Company will immediately constitute or be a part of a Related Business of the
Company, SINA or such Subsidiary (if it continues to be a Subsidiary)
immediately following such investment or (2) used to permanently reduce
Senior Debt (provided that in the case of a revolver or similar arrangement
that makes credit available, such commitment is so permanently reduced by
such amount) or to purchase or redeem the Issuers' 9% Senior Subordinated Notes
due 2007 issued under an indenture dated as of March 10, 1997, (ii) no more than
the greater of (A) $20 million or (B) 15% of the total consideration for such
Asset Sale or series of related Asset Sales consists of consideration other
than cash or Cash Equivalents; provided however, that more than 15% of the
total consideration may consist of consideration other than cash or Cash
Equivalents if (A) the portion of such consideration that does not consist of
cash or Cash Equivalents consists of assets of a type ordinarily used in the
operation of a Related Business (including Capital Stock of a person that
becomes a wholly owned Subsidiary and that holds such assets) to be used by
the Issuers or a Subsidiary in the conduct of a Related Business, (B) the
terms of such Asset Sale have been approved by a majority of the members of
the Board of Directors of the Company having no personal stake in such
transaction, and (C) if the value of the assets being disposed of by the
Issuers or such Subsidiary in such transaction (as determined in good faith
by such members of the Board of Directors) is at least $10 million, the Board
of Directors of the Company has received a written opinion of a nationally
recognized investment banking firm to the effect that such Asset Sale is
fair, from a financial point of view, to the Company and the Company has
delivered a copy of such opinion to the Trustee, (iii) no Default or Event of
Default shall have occurred and be continuing at the time of, or would occur
after giving effect, on a pro forma basis, to, such Asset Sale, and (iv) if
the value of the assets disposed of is at least $5 million, the Board of
Directors of the Company determines in good faith that the Company or such
Subsidiary, as applicable, receives fair market value for such Asset Sale (as
evidenced by a resolution of the Board of Directors).
An acquisition of such series of Debt Securities and all other
outstanding Debt Securities pursuant to an Asset Sale Offer may be deferred
until the accumulated Net Cash Proceeds from Asset Sales not applied to the
uses set forth in (i) above (the "Excess Proceeds") exceeds $20 million and
that each Asset Sale Offer shall remain open for 20 Business Days following
its commencement (the "Asset Sale Offer Period"). Upon expiration of the
Asset Sale Offer Period, the Issuers shall apply the Asset Sale Offer Amount
plus an amount equal to accrued and unpaid interest to the purchase of all
Debt Securities of such series and all other outstanding Debt Securities
properly tendered (on a pro rata basis
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if the Asset Sale Offer Amount is insufficient to purchase all Debt
Securities of such series and all other outstanding Debt Securities so
tendered) at the Asset Sale Offer Price (together with accrued and unpaid
interest). To the extent that the aggregate amount of Debt Securities
tendered pursuant to an Asset Sale Offer is less than the Asset Sale Offer
Amount, the Issuers may use any remaining Net Cash Proceeds for general
corporate purposes as otherwise permitted by the Indenture and following the
consummation of each Asset Sale Offer the Excess Proceeds amount shall be
reset to zero. For purposes of (ii) above, total consideration received means
the total consideration received for such Asset Sales minus the amount of (a)
Senior Debt assumed by a transferee which assumption permanently reduces the
amount of Indebtedness outstanding on the Issue Date of such series of Debt
Securities or permitted pursuant to clause (a) or (c) of the definition of
Permitted Indebtedness (including that in the case of a revolver or similar
arrangement that makes credit available, such commitment is so reduced by
such amount), (b) FF&E Indebtedness secured solely by the assets sold and
assumed by a transferee and (c) property that within 30 days of such Asset
Sale is converted into cash or Cash Equivalents.
Notwithstanding the foregoing provisions of the prior paragraph:
(i) the Company and its Subsidiaries may, in the ordinary course of
business, convey, sell, transfer, assign or otherwise dispose of inventory
acquired and held for resale in the ordinary course of business;
(ii) the Company and its Subsidiaries may convey, sell, transfer,
assign or otherwise dispose of assets pursuant to and in accordance with
the provisions of the covenant "Limitation on Merger, Sale or
Consolidation";
(iii) the Company and its Subsidiaries may sell or dispose of damaged,
worn out or other obsolete property in the ordinary course of business so
long as such property is no longer necessary for the proper conduct of the
business of the Company or such Subsidiary, as applicable;
(iv) the Issuers and the Subsidiaries may convey, sell, transfer,
assign or otherwise dispose of assets to any Issuer or any of their wholly
owned Guarantors, if any; and
(v) the Issuers may sell their Equity Interests in certain
non-strategic real estate on Paradise Island and in Atlantic City.
All Net Cash Proceeds from an Event of Loss shall be invested, used for
prepayment of Senior Debt, or used to repurchase such series of Debt Securities,
all within the period and as otherwise provided above in clauses (i)(a) or
(i)(b) of the first paragraph of this covenant.
In addition to the foregoing, the Company will not, and will not permit any
Subsidiary to, directly or indirectly make any Asset Sale of any of the Equity
Interests of any Subsidiary except (i) pursuant to an Asset Sale of all the
Equity Interests of such Subsidiary or (ii) pursuant to an Asset Sale of common
stock with no preferences or special rights or privileges and with no redemption
or prepayment provisions, provided that after such sale the Issuers or their
Subsidiaries own at least 50.1% of the voting and economic interests of the
Capital Stock of such Subsidiary.
Any Asset Sale Offer shall be made in compliance with all applicable laws,
rules, and regulations, including, if applicable, Regulation 14E of the Exchange
Act and the rules and regulations thereunder and all other applicable Federal
and state securities laws.
Limitation on Transactions with Affiliates
None of the Issuers or any of their Subsidiaries will be permitted on or
after the Issue Date of such series of Debt Securities to enter into or suffer
to exist any contract, agreement, arrangement or transaction with any Affiliate
(an "Affiliate Transaction"), or any series of related Affiliate Transactions
(other than Exempted Affiliate Transactions) (i) unless it is determined that
the terms of such Affiliate Transaction are fair and reasonable to the Company
or such Subsidiary, as applicable, and no less favorable to the Company or such
Subsidiary, as applicable, than could have been obtained in an arm's-length
transaction with a non-Affiliate and (ii) if involving consideration to either
party in excess of $2 million, unless such Affiliate Transaction(s) has been
approved by a majority of the members of the Board of Directors that are
disinterested in such transaction and (iii) if involving consideration to either
party in excess of $15 million, unless in addition to the foregoing Company,
prior to the consummation thereof, obtains a written favorable opinion as to the
fairness of such transaction to the Company from a financial point of view from
an independent investment banking firm of national reputation.
Limitation on Payments for Consent
None of the Issuers or any of their Subsidiaries or Unrestricted
Subsidiaries shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any holder of
any such series of Debt Securities for, or as an inducement to, any consent,
waiver or amendment of any of the terms or provisions of the Indenture or such
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series of Debt Securities unless such consideration is offered to be paid or
agreed to be paid to all holders of such series of Debt Securities which so
consent, waive or agree to amend in the time frame set forth in the solicitation
documents relating to such consent, waiver or agreement, which solicitation
documents must be mailed to all holders of such series of Debt Securities prior
to the expiration of the solicitation.
Limitation on Merger, Sale or Consolidation
With respect to a series of Debt Securities, neither of the Issuers
will, directly or indirectly, consolidate with or merge with or into another
person or sell, lease, convey or transfer all or substantially all of its
assets (computed as to each Issuer on a consolidated basis), whether in a
single transaction or a series of related transactions, to another person or
group of affiliated persons or adopt a Plan of Liquidation, unless (i) either
(a) the Company or SINA, as applicable, is the resulting surviving or
transferee entity (the "Successor Company") or (b) the Successor Company or,
in the case of a Plan of Liquidation, the entity which receives the greatest
value from such Plan of Liquidation is a corporation organized under the laws
of the Commonwealth of The Bahamas (in the case of the Company only) or the
United States, any state thereof or the District of Columbia and expressly
assumes by supplemental indenture all of the obligations of the Company or
SINA, as applicable, in connection with such series of Debt Securities and
the Indenture; (ii) no Default or Event of Default with respect to such
series of Debt Securities shall exist or shall occur immediately after giving
effect on a pro forma basis to such transaction; (iii) immediately after
giving effect to such transaction on a pro forma basis, the Consolidated Net
Worth of the Successor Company or, in the case of a Plan of Liquidation, the
entity which receives the greatest value from such Plan of Liquidation is at
least equal to the Consolidated Net Worth of the Company or SINA, as
applicable, immediately prior to such transaction; and (iv) immediately after
giving effect to such transaction on a pro forma basis, the Successor Company
or, in the case of a Plan of Liquidation, the entity which receives the
greatest value from such Plan of Liquidation would immediately thereafter be
permitted to incur at least $1.00 of additional Indebtedness pursuant to the
Debt Incurrence Ratio set forth in the covenant "Limitation on Incurrence of
Additional Indebtedness and Disqualified Capital Stock", to the extent
applicable to such series of Debt Securities.
With respect to a series of Debt Securities, upon any consolidation or
merger or any transfer of all or substantially all of the assets of the
Company or SINA, as applicable, or consummation of a Plan of Liquidation in
accordance with the foregoing, the successor corporation formed by such
consolidation or into which the Company or SINA is merged or to which such
transfer is made or, in the case of a Plan of Liquidation, the entity which
receives the greatest value from such Plan of Liquidation shall succeed to,
and be substituted for, and may exercise every right and power of, the
Company or SINA, as applicable, under the Indenture with the same effect as
if such successor corporation had been named therein as the Company or SINA,
as applicable, and the Company or SINA, as applicable, shall be released from
the obligations under such series of Debt Securities and the Indenture except
with respect to any obligations that arise from, or are related to, such
transaction.
For purposes of the foregoing, the transfer (by lease, assignment, sale or
otherwise) of all or substantially all of the properties and assets of one or
more Subsidiaries, the interest of the Company or SINA, as applicable, in which
constitutes all or substantially all of the properties and assets of the Company
or SINA, as applicable, shall be deemed to be the transfer of all or
substantially all of the properties and assets of the Company, or SINA, as
applicable.
Limitation on Lines of Business
None of the Issuers or any of their Subsidiaries shall directly or
indirectly engage to any substantial extent in any line or lines of business
activity other than that which, in the good faith judgment of the Board of
Directors of the Company, is a Related Business.
Future Subsidiary Guarantors
All present and future Subsidiaries of either Issuer (including any
Unrestricted Subsidiary upon being designated a Subsidiary) will jointly and
severally guaranty irrevocably and unconditionally all principal, premium, if
any, and interest on such series of Debt Securities on a senior subordinated
basis.
Release of Guarantors
No Guarantor shall consolidate or merge with or into (whether or not such
Guarantor is the surviving person) another person unless (i) subject to the
provisions of the following paragraph, the person formed by or surviving any
such consolidation or merger (if other than such Guarantor) assumes all the
obligations of such Guarantor pursuant to a supplemental indenture in form
reasonably satisfactory to the Trustee, pursuant to which such person shall
unconditionally guarantee, on a senior subordinated basis, all of such
Guarantor's obligations under such Guarantor's guarantee and the Indenture on
the terms set forth in the Indenture; and (ii) immediately before and
immediately after giving effect to such transaction on a pro forma basis, no
Default or Event of Default shall have occurred or be continuing.
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Notwithstanding the foregoing, upon the sale or disposition (whether by
merger, stock purchase, asset sale or otherwise) of a Guarantor of all or
substantially all of its assets to an entity which is not a Subsidiary or the
designation of a Subsidiary as an Unrestricted Subsidiary, which transaction is
otherwise in compliance with the Indenture (including, without limitation, the
provisions of the covenant "Limitations on Sale of Assets and Subsidiary
Stock"), such Guarantor will be deemed released from its obligations under its
Guarantee of such series of Debt Securities; provided, however, that any such
termination shall occur only to the extent that all obligations of such
Guarantor under all of its guarantees of, and under all of its pledges of assets
or other security interests which secure, any Indebtedness of either Issuer or
any of their Subsidiaries shall also terminate upon such release, sale or
transfer.
Limitation on Status as Investment Company
Neither the Company nor its Subsidiaries shall be required to register as
an "investment company" (as that term is defined in the Investment Company Act
of 1940, as amended), or from otherwise becoming subject to regulation under the
Investment Company Act.
Reports
With respect to a series of Debt Securities, the Issuers will be subject to
certain reporting obligations to the extent and in the manner set forth in the
Prospectus Supplement relating to such series. In addition, any or all of the
following provisions will apply to such series if the Prospectus Supplement
relating thereto so specifies.
Whether or not the Company or SINA is subject to the reporting requirements
of Section 13 or 15(d) of the Exchange Act, each of the Company and SINA shall
deliver to the Trustee and to each holder within 15 days after it is or would
have been (if it were subject to such reporting obligations) required to furnish
such with the Commission, annual and quarterly financial statements
substantially equivalent to financial statements that would have been included
in reports filed with the Commission, if such entity were subject to the
requirements of Section 13 or 15(d) of the Exchange Act, including, with respect
to annual information only, a report thereon by the Issuers' certified
independent public accountants as such would be required in such reports to the
Commission, and, in each case, together with a management's discussion and
analysis of financial condition and results of operations which would be so
required and, to the extent permitted by the Exchange Act or the Commission,
file with the Commission the annual, quarterly and other reports which it is or
would have (if it were subject to such reporting obligations) been required to
file with the Commission.
Events of Default and Remedies
A series of Debt Securities will be subject to default and event of default
provisions to the extent and in the manner set forth in the Prospectus
Supplement relating to such series. In addition, any or all of the following
provisions will apply to such series if the Prospectus Supplement relating
thereto so states.
An Event of Default is, with respect to such series of Debt Securities,
(i) the failure by the Issuers to pay any installment of interest on such
series of Debt Securities as and when the same becomes due and payable and
the continuance of any such failure for 30 days, (ii) the failure by the
Issuers to pay all or any part of the principal, or premium, if any, on such
series of Debt Securities when and as the same becomes due and payable at
maturity, redemption, by acceleration or otherwise, whether or not prohibited
by the subordination provisions of the Indenture, including, without
limitation, payment of the Change of Control Purchase Price or the Asset Sale
Offer Price, or otherwise, (iii) the failure by either of the Issuers or any
of their Subsidiaries otherwise to comply with the covenants described under
"Certain Covenants--Repurchase of Debt Securities at the Option of the Holder
Upon a Change of Control", "--Limitation on Sale of Assets and Subsidiary
Stock" and "--Limitation on Merger, Sale or Consolidation", to the extent
applicable to such series of Debt Securities, (iv)(A) failure by either of
the Issuers or any of their Subsidiaries to observe or perform any other
covenant or agreement described under "Certain Covenants" (to the extent
applicable to such series of Debt Securities and except as provided in
clauses (i), (ii) and (iii) above) and the continuance of such failure for a
period of 30 days after written notice is given to the Issuers by the Trustee
or to the Issuers and the Trustee by the holders of at least 25% in aggregate
principal amount of such series of Debt Securities then outstanding, or (B)
failure by either of the Issuers or any of their Subsidiaries to observe or
perform any other covenant or agreement contained in such series of Debt
Securities or the Indenture (to the extent applicable to such series of Debt
Securities and except as provided for in clauses (i), (ii), (iii) and (iv)(A)
above) and the continuance of such failure for 60 days after written notice
is given to the Issuers by the Trustee or the Issuers and the Trustee by the
holders of at least 25% in aggregate principal amount of such series of Debt
Securities then outstanding, (v) certain events of bankruptcy, insolvency or
reorganization in respect of either of the Issuers or any of their
Significant Subsidiaries, (vi) if such series of Debt Securities so provides,
a default in Indebtedness of either of the Issuers or any of their
Subsidiaries with an aggregate principal amount in excess of $10 million (a)
resulting from the failure to pay any principal at final stated maturity or
(b) as a result of which the maturity of such Indebtedness has been
accelerated prior to its stated maturity, and (vii) if such series of Debt
Securities so provides, final unsatisfied judgments not covered by insurance
aggregating in excess of $10 million, at any one time rendered against either
of the Issuers or any of their Subsidiaries and either (a) the commencement
by any creditor of any enforcement proceeding upon any such judgment that is
not promptly stayed or (b) such judgment is not stayed, bonded or discharged
within 60 days. The
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Indenture provides that if a Default occurs and is continuing, the Trustee must,
within 90 days after the occurrence of such default, give to the holders notice
of such default.
If an Event of Default occurs and is continuing with respect to such
series of Debt Securities (other than an Event of Default specified in clause
(v), above, relating to either of the Issuers or any of their Significant
Subsidiaries,) then in every such case, unless the principal of all Debt
Securities of such series shall have already become due and payable, either
the Trustee or the holders of 25% in aggregate principal amount of such
series of Debt Securities then outstanding, by notice in writing to the
Issuers (and to the Trustee if given by holders) (an "Acceleration Notice"),
may declare all principal and premium, if any, determined as set forth below,
and accrued and unpaid interest thereon to be due and payable immediately;
provided, however, that if any Senior Debt is outstanding pursuant to the
Credit Agreement, such acceleration shall not be effective until the earlier
of (x) the fifth Business Day after the giving to the Company and the
Representative of such written notice, unless such Event of Default is cured
or waived prior to such date and (y) the date of acceleration of any Senior
Debt under the Credit Agreement. If an Event of Default specified in clause
(v) above relating to either of the Issuers or any of their Significant
Subsidiaries occurs with respect to such series of Debt Securities, all
principal and accrued interest thereon will be immediately due and payable on
all outstanding Debt Securities of such series without any declaration or
other act on the part of the Trustee or the holders thereof. The holders of a
majority in aggregate principal amount of such series of Debt Securities
generally are authorized to rescind such acceleration if all existing Events
of Default, other than the nonpayment of the principal of, premium, if any,
and interest on such series of Debt Securities which have become due solely
by such acceleration, have been cured or waived.
With respect to such series of Debt Securities, prior to the declaration
of acceleration of the maturity of such series of Debt Securities, the
holders of a majority in aggregate principal amount of such series of Debt
Securities at the time outstanding may waive on behalf of all the holders of
such series any default, except a default in the payment of principal of or
interest on any Debt Security of such series not yet cured or a default with
respect to any covenant or provision which applies to such series of Debt
Securities and which cannot be modified or amended without the consent of the
holder of each outstanding Debt Security of such series affected. Subject to
the provisions of the Indenture relating to the duties of the Trustee, the
Trustee will be under no obligation to exercise any of its rights or powers
under the Indenture at the request, order or direction of any of the holders
of such series of Debt Securities, unless such holders have offered to the
Trustee reasonable security or indemnity. Subject to all provisions of the
Indenture and applicable law, the holders of a majority in aggregate
principal amount of such series of Debt Securities then outstanding will have
the right to direct the time, method and place of conducting any proceeding
for any remedy available to the Trustee, or exercising any trust or power
conferred on the Trustee.
Legal Defeasance and Covenant Defeasance
The Indenture provides that, with respect to a series of Debt Securities,
the Issuers may, at their option and at any time, elect to have their
obligations and the obligations of the Guarantors, if any, discharged with
respect to such series of Debt Securities then outstanding ("Legal Defeasance").
Such Legal Defeasance means that the Issuers shall be deemed to have paid and
discharged the entire indebtedness represented by such series of Debt
Securities, and the Indenture shall cease to be of further effect as to all such
series of Debt Securities and Guarantees, if any, then outstanding, except as to
(i) rights of holders to receive payments in respect of the principal of,
premium, if any, and interest on such series of Debt Securities when such
payments are due from the trust funds; (ii) Issuers' obligations with respect to
such series of Debt Securities concerning issuing temporary Debt Securities of
such series, registration of Debt Securities of such series, mutilated,
destroyed, lost or stolen Debt Securities of such series, and the maintenance of
an office or agency for payment and money for security payments held in trust;
(iii) the rights, powers, trust, duties, and immunities of the Trustee, and the
Issuers' obligations in connection therewith; and (iv) the Legal Defeasance
provisions of the Indenture. In addition, with respect to a series of Debt
Securities, the Issuers may, at their option and at any time, elect to have the
obligations of the Issuers and the Guarantors, if any, released with respect to
certain covenants that are described in the Indenture ("Covenant Defeasance")
and thereafter any omission to comply with such obligations shall not constitute
a Default or Event of Default with respect to such series of Debt Securities. In
the event Covenant Defeasance occurs, certain events (not including nonpayment,
nonpayment of Guarantees, if any, bankruptcy, receivership, rehabilitation and
insolvency events ) described under "Events of Default" will no longer
constitute an Event of Default with respect to such series of Debt Securities.
The Issuers may exercise their Legal Defeasance option regardless of whether
they previously exercised Covenant Defeasance.
In order to exercise either Legal Defeasance or Covenant Defeasance with
respect to a series of Debt Securities, (i) the Issuers must irrevocably
deposit with the Trustee, in trust, for the benefit of the holders of such
series of Debt Securities, U.S. legal tender, U.S. government obligations or
a combination thereof, in such amounts as will be sufficient, in the opinion
of a nationally recognized firm of independent public accountants, to pay the
principal of, premium, if any, and interest on such Debt Securities on the
stated date for payment thereof or on the redemption date, if any, of such
principal or installment of principal of, premium, if any, or interest on
such series of Debt Securities, and the holders of such series of Debt
Securities must have a valid, perfected, exclusive security interest in such
trust, (ii) in the case of Legal Defeasance, the Issuers shall have delivered
to the Trustee an opinion of counsel in the United States reasonably
acceptable to Trustee confirming that (A) the Issuers have received from, or
there has been published by, the Internal Revenue Service a ruling or (B)
since the date of the Indenture, there has been a change in the applicable
federal income tax law, in either case to the effect that, and based thereon
such opinion of counsel shall confirm that, the holders of such Debt
Securities will not recognize
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income, gain or loss for federal income tax purposes as a result of such
Legal Defeasance and will be subject to federal income tax on the same
amounts, in the same manner and at the same times as would have been the case
if such Legal Defeasance had not occurred, (iii) in the case of Covenant
Defeasance, the Issuers shall have delivered to the Trustee an opinion of
counsel in the United States reasonably acceptable to such Trustee confirming
that the holders of such Debt Securities will not recognize income, gain or
loss for federal income tax purposes as a result of such Covenant Defeasance
and will be subject to federal income tax on the same amounts, in the same
manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred, (iv) no Default or Event of Default with respect
to such series shall have occurred and be continuing on the date of such
deposit or insofar as Events of Default from bankruptcy or insolvency events
are concerned, at any time in the period ending on the 91st day after the
date of deposit, (v) such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under the
Indenture or any other material agreement or instrument to which either of
the Issuers or any of their Subsidiaries is a party or by which either of the
Issuers or any of their Subsidiaries is bound, (vi) the Issuers shall have
delivered to the Trustee an officers' certificate stating that the deposit
was not made by the Issuers with the intent of preferring the holders of such
Debt Securities over any other creditors of the Issuers or with the intent of
defeating, hindering, delaying or defrauding any other creditors of the
Issuers or others and (vii) the Issuers shall have delivered to the Trustee
an officers' certificate and an opinion of counsel, each stating that the
conditions precedent provided for in, in the case of the officers'
certificate, clauses (i) through (vi) and, in the case of the opinion of
counsel, clauses (i) (with respect to the validity and perfection of the
security interest), (ii), (iii) and (v) of this paragraph have been complied
with.
If, with respect to a series of Debt Securities, the funds deposited with
the Trustee to effect Legal Defeasance or Covenant Defeasance are insufficient
to pay the principal of, premium, if any, and interest on such series of Debt
Securities when due, then the obligations of the Issuers under the Indenture
will be revived and no such defeasance will be deemed to have occurred.
Amendments and Supplements
The Indenture contains provisions permitting the Issuers, the
Guarantors, if any, and the Trustee to enter into supplemental indentures for
certain limited purposes without the consent of the holders of the Debt
Securities. With the consent of the holders of not less than a majority in
aggregate principal amount of a series of Debt Securities then outstanding,
the Issuers, the Guarantors, if any, and the Trustee are permitted to amend
or supplement the Indenture or any supplemental indenture with respect to
such series of Debt Securities or modify the rights of the holders thereof;
provided, that no such modification may, without the consent of each holder
affected thereby: (i) change the Stated Maturity on any series of Debt
Securities, or reduce the principal amount thereof or the rate (or extend the
time for payment) of interest thereon or any premium payable upon the
redemption thereof, or change the place of payment where, or the coin or
currency in which, any Debt Security or any premium or the 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 (or, in the case of
redemption, on or after the Redemption Date), or reduce the Change of Control
Purchase Price or the Asset Sale Offer Price, or alter the provisions
(including the defined terms used therein) regarding the right of the Issuers
to redeem any Debt Security in a manner adverse to the holders thereof, or
(ii) reduce the percentage in principal amount of any Debt Security then
outstanding, the consent of whose holders is required for any such amendment,
supplemental indenture or waiver provided for in the Indenture, or (iii)
modify any of the waiver provisions, except to increase any required
percentage or to provide that certain other provisions of the Indenture
cannot be modified or waived without the consent of the holder of each
outstanding Debt Security affected thereby.
No Personal Liability of Partners, Stockholders, Officers, Directors
The Indenture provides that no direct or indirect stockholder, employee,
officer or director, as such, past, present or future of the Issuers, the
Guarantors, if any, or any successor entity shall have any personal liability in
respect of the obligations of the Issuers or the Guarantors, if any, under the
Indenture or the Debt Securities by reason of his or its status as such
stockholder, employee, officer or director, except to the extent such person is
an Issuer or a Guarantor.
Certain Definitions
"Acquired Indebtedness" means Indebtedness or Disqualified Capital Stock of
any person existing at the time such person becomes a Subsidiary of either of
the Issuers or is merged or consolidated into or with either of the Issuers or
any of their Subsidiaries.
"Acquisition" means the purchase or other acquisition of any person or all
or substantially all the assets of any person by any other person, or the
acquisition of assets that constitute all or substantially all of an operating
unit of business, whether by purchase, merger, consolidation, or other transfer,
and whether or not for consideration.
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"Affiliate" means any person directly or indirectly controlling or
controlled by or under direct or indirect common control with the Company. For
purposes of this definition, the term "control" means the power to direct the
management and policies of a person, directly or through one or more
intermediaries, whether through the ownership of voting securities, by contract,
or otherwise, provided, that, with respect to ownership interest in the Company
and its Subsidiaries a Beneficial Owner of 10% or more of the total voting power
normally entitled to vote in the election of directors, managers or trustees, as
applicable, shall for such purposes be deemed to constitute control.
"Average Life" means, as of the date of determination, with respect to any
security or instrument, the quotient obtained by dividing (i) the sum of the
products of (a) the number of years from the date of determination to the date
or dates of each successive scheduled principal (or redemption) payment of such
security or instrument and (b) the amount of each such respective principal (or
redemption) payment by (ii) the sum of all such principal (or redemption)
payments.
"Beneficial Owner" or "beneficial owner" has the meaning attributed to it
in Rules 13d-3 and 13d-5 under the Exchange Act (as in effect on the Issue
Date), whether or not applicable, except that a "person" shall be deemed to have
"beneficial ownership" of all shares that any such person has the right to
acquire, whether such right is exercisable immediately or only after the passage
of time.
"Business Day" means each Monday, Tuesday, Wednesday, Thursday and Friday
which is not a day on which banking institutions in New York, New York or the
New York Stock Exchange are authorized or obligated by law or executive order to
close.
"Capitalized Lease Obligation" means, as applied to any person, any lease
of any property (whether real, personal or mixed) of which the discounted
present value of the rental obligations of such person, as lessee, in conformity
with GAAP, is required to be capitalized on the balance sheet of such person.
"Capital Stock" means, with respect to any corporation, any and all shares,
interests, rights to purchase (other than convertible or exchangeable
Indebtedness that is not otherwise itself capital stock), warrants, options,
participations or other equivalents of or interests (however designated) in
stock issued by that corporation.
"Cash Equivalent" means (a)(i) securities issued or directly and fully
guaranteed or insured by the United States of America or any agency or
instrumentality thereof (provided that the full faith and credit of the United
States of America is pledged in support thereof), (ii) time deposits and
certificates of deposit of any domestic commercial bank of recognized standing
having capital and surplus in excess of $500 million or (iii) commercial paper
issued by others rated at least A-1 or the equivalent thereof by Standard &
Poor's Corporation or at least P-1 or the equivalent thereof by Moody's
Investors Service, Inc., and in the case of each of (i), (ii) and (iii) above
maturing within one year after the date of acquisition or (b) shares of money
market mutual funds or similar funds having assets in excess of $500 million.
"Consolidated Coverage Ratio" of any person on any date of determination (a
"Transaction Date") means the ratio, on a pro forma basis, of (a) the aggregate
amount of Consolidated EBITDA of such person attributable to continuing
operations and businesses (exclusive of amounts attributable to operations and
businesses permanently discontinued or disposed of) for the Reference Period to
(b) the aggregate Consolidated Fixed Charges of such person (exclusive of
amounts attributable to operations and businesses permanently discontinued or
disposed of, but only to the extent that the obligations giving rise to such
Consolidated Fixed Charges would no longer be obligations contributing to such
person's Consolidated Fixed Charges subsequent to the Transaction Date) during
the Reference Period; provided that for purposes of such calculation, (i)
Acquisitions which occurred during the Reference Period or subsequent to the
Reference Period and on or prior to the Transaction Date shall be assumed to
have occurred on the first day of the Reference Period, (ii) transactions giving
rise to the need to calculate the Consolidated Coverage Ratio shall be assumed
to have occurred on the first day of the Reference Period, (iii) the incurrence
of any Indebtedness or issuance of any Disqualified Capital Stock during the
Reference Period or subsequent to the Reference Period and on or prior to the
Transaction Date (and the application of the proceeds therefrom to the extent
used to refinance or retire other Indebtedness) shall be assumed to have
occurred on the first day of such Reference Period, and (iv) the Consolidated
Fixed Charges of such person attributable to interest on any Indebtedness or
dividends on any Disqualified Capital Stock bearing a floating interest (or
dividend) rate shall be computed on a pro forma basis as if the rate in effect
on the Transaction Date had been the applicable rate for the entire period,
unless such person or any of its Subsidiaries is a party to an Interest Swap or
Hedging Obligation (which shall remain in effect for the 12-month period
immediately following the Transaction Date) that has the effect of fixing the
interest rate on the date of computation, in which case such rate (whether
higher or lower) shall be used.
"Consolidated EBITDA" means, with respect to any person, for any period,
the Consolidated Net Income of such person for such period adjusted to add
thereto (to the extent deducted from net revenues in determining Consolidated
Net Income), without duplication, the sum of (i) Consolidated income tax
expense, (ii) Consolidated depreciation and amortization expense, provided that
consolidated depreciation and amortization of a Subsidiary that is a less than
wholly owned Subsidiary shall
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only be added to the extent of the equity interest of such person in such
Subsidiary and (iii) Consolidated Fixed Charges, less any noncash interest
income.
"Consolidated Fixed Charges" of any person means, for any period, the
aggregate amount (without duplication and determined in each case in accordance
with GAAP) of (a) interest expensed or capitalized, paid, accrued, or scheduled
to be paid or accrued (including, in accordance with the following sentence,
interest attributable to Capitalized Lease Obligations) of such person and its
Consolidated Subsidiaries during such period, including (i) original issue
discount and non-cash interest payments or accruals on any Indebtedness, (ii)
the interest portion of all deferred payment obligations and (iii) all
commissions, discounts and other fees and charges owed with respect to bankers'
acceptances and letters of credit financings and currency and Interest Swap and
Hedging Obligations, in each case to the extent attributable to such period, but
excluding interest payments on the Showboat Notes, and (b) the amount of
dividends accrued or payable (or guaranteed) by such person or any of its
Consolidated Subsidiaries in respect of preferred stock (other than by
Subsidiaries of such person to such person or such person's wholly owned
Subsidiaries). For purposes of this definition, (x) interest on a Capitalized
Lease Obligation shall be deemed to accrue at an interest rate reasonably
determined by the Company to be the rate of interest implicit in such
Capitalized Lease Obligation in accordance with GAAP and (y) interest expense
attributable to any Indebtedness represented by the guaranty by such person or a
Subsidiary of such person of an obligation of another person shall be deemed to
be the interest expense attributable to the Indebtedness guaranteed.
"Consolidated Net Income" means, with respect to any person for any period,
the net income (or loss) of such person and its Consolidated Subsidiaries
(determined on a consolidated basis in accordance with GAAP) for such period,
adjusted to exclude (only to the extent included in computing such net income
(or loss) and without duplication): (a) all gains (but not losses) which are
either extraordinary (as determined in accordance with GAAP), unusual or
nonrecurring (including any gain from the sale or other disposition of assets or
currency transactions outside the ordinary course of business or from the
issuance or sale of any capital stock), (b) the net income, if positive, of any
person, other than a Consolidated Subsidiary, in which such person or any of its
Consolidated Subsidiaries has an interest, except to the extent of the amount of
any dividends or distributions actually paid in cash to such person or a wholly
owned Consolidated Subsidiary of such person during such period, but in any case
not in excess of such person's pro rata share of such person's net income for
such period, (c) the net income or loss of any person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition, (d)
the net income, if positive, of any of such person's Consolidated Subsidiaries
to the extent that the declaration or payment of dividends or similar
distributions is not at the time permitted by operation of the terms of its
charter or bylaws or any other agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such Consolidated
Subsidiary, except for existing restrictions under the Credit Agreement and (e)
the net income attributable to the Showboat Lease.
"Consolidated Net Worth" of any person at any date means the aggregate
consolidated stockholders' equity of such person (plus amounts of equity
attributable to preferred stock) and its Consolidated Subsidiaries, as would be
shown on the consolidated balance sheet of such person prepared in accordance
with GAAP, adjusted to exclude (to the extent included in calculating such
equity), the amount of any such stockholders' equity attributable to
Disqualified Capital Stock or treasury stock of such person and its Consolidated
Subsidiaries.
"Consolidated Subsidiary" means, for any person, each Subsidiary of such
person (whether now existing or hereafter created or acquired) the financial
statements of which are consolidated for financial statement reporting purposes
with the financial statements of such person in accordance with GAAP.
"Credit Agreement" means the second amended and restated revolving credit
agreement dated as of August 12, 1997 by and among Sun International Bahamas
Limited, the Company, certain of the Company's subsidiaries, certain financial
institutions and The Bank of Nova Scotia, as administrative and collateral
agent, providing for an aggregate $375 million revolving credit facility
(excluding any amounts with respect to Interest Swap and Hedging Obligations
complying with the provisions set forth below) (which amount may be increased to
$500 million upon the later of the Paradise Island Expansion Opening or December
31, 1998), including any related notes, guarantees, collateral documents,
instruments and agreements executed in connection therewith, as such credit
agreement and/or related documents may be amended, restated, supplemented,
renewed, replaced or otherwise modified from time to time whether or not with
the same agent, trustee, representative lenders or holders, and, subject to the
proviso to the next succeeding sentence, irrespective of any changes in the
terms and conditions thereof. Without limiting the generality of the foregoing,
the term "Credit Agreement" shall include agreements in respect of Interest Swap
and Hedging Obligations entered into for bona fide hedging purposes and not
entered into for speculative purposes with lenders party to the Credit Agreement
or their affiliates and shall also include any amendment, amendment and
restatement, renewal, extension, restructuring, supplement or modification to
any Credit Agreement and all refundings, refinancings and replacements of any
Credit Agreement, including any agreement (i) extending or shortening the
maturity of any Indebtedness incurred thereunder or contemplated thereby, (ii)
adding or deleting borrowers or guarantors thereunder, so long as borrowers and
issuers include one or more of the Company and its Subsidiaries and their
respective successors and assigns, (iii) increasing the amount of Indebtedness
incurred thereunder or available to be borrowed thereunder, provided that on the
date such Indebtedness is incurred it would not be prohibited by clause (a) of
the definition
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of "Permitted Indebtedness," or (iv) otherwise altering the terms and conditions
thereof in a manner not prohibited by the terms hereof.
"Disqualified Capital Stock" means, with respect to a series of Debt
Securities, (i) except as set forth in (ii), with respect to any person,
Equity Interests of such person that, by its terms or by the terms of any
security into which it is convertible, exercisable or exchangeable, is, or
upon the happening of an event or the passage of time would be, required to
be redeemed or repurchased (including at the option of the holder thereof) by
such person or any of its Subsidiaries, in whole or in part, on or prior to
the Stated Maturity of such series of Debt Securities and (ii) with respect
to any Subsidiary of such person (other than the Guarantors, if any), any
Equity Interests other than any common equity with no preference, privileges,
or redemption or repayment provisions.
"Equity Interest" of any person means any shares, interests, participations
or other equivalents (however designated) in such person's equity, and shall in
any event include any Capital Stock issued by, or partnership or membership
interests in, such person.
"Event of Loss" means, with respect to any property or asset, any (i) loss,
destruction or damage of such property or asset or (ii) any condemnation,
seizure or taking, by exercise of the power of eminent domain or otherwise, of
such property or asset, or confiscation or requisition of the use of such
property or asset.
"Exempted Affiliate Transaction" means transactions solely between the
Company and any of its wholly owned Subsidiaries or solely among wholly owned
Subsidiaries of the Company.
"FF&E Indebtedness" means any Indebtedness of a person to any seller or
other person incurred to finance the acquisition (including in the case of a
Capitalized Lease Obligation, the lease) of any gaming facility or hotel or
gaming or hotel related fixtures, furniture or equipment which is directly
related to a Related Business of the Company and which is incurred concurrently
with such acquisition and is secured only by the assets so financed.
"GAAP" means, with respect to a series of Debt Securities, United States
generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute
of Certified Public Accountants and statements and pronouncements of the
Financial Accounting Standards Board or in such other statements by such
other entity as approved by a significant segment of the accounting
profession in the United States as in effect on the Issue Date.
"Indebtedness" of any person means, without duplication, (a) all
liabilities and obligations, contingent or otherwise, of any such person, (i) in
respect of borrowed money (whether or not the recourse of the lender is to the
whole of the assets of such person or only to a portion thereof, (ii) evidenced
by bonds, notes, debentures or similar instruments, (iii) representing the
balance deferred and unpaid of the purchase price of any property or services,
except those incurred in the ordinary course of its business that would
constitute ordinarily trade payables to trade creditors that are not more than
60 days past their original due date, (iv) evidenced by bankers' acceptances or
similar instruments issued or accepted by banks, (v) relating to any Capitalized
Lease Obligation, or (vi) evidenced by a letter of credit or a reimbursement
obligation of such person with respect to any letter of credit; (b) all net
obligations of such person under Interest Swap and Hedging Obligations; (c) all
liabilities and obligations of others of the kind described in the preceding
clause (a) or (b) that such person has guaranteed or that is otherwise its legal
liability or which are secured by any assets or property of such person and (d)
any and all deferrals, renewals, extensions, refinancing and refundings (whether
direct or indirect) of, or amendments, modifications or supplements to, any
liability of the kind described in any of the preceding clause (a), (b) or (c),
or this clause (d), whether or not between or among the same parties, and (e)
all Disqualified Capital Stock of such person (measured at the greater of its
voluntary or involuntary maximum fixed repurchase price plus accrued and unpaid
dividends). For purposes hereof, the "maximum fixed repurchase price" of any
Disqualified Capital Stock which does not have a fixed repurchase price shall be
calculated in accordance with the terms of such Disqualified Capital Stock as if
such Disqualified Capital Stock were purchased on any date on which Indebtedness
shall be required to be determined pursuant to the Indenture, and if such price
is based upon, or measured by, the fair market value of such Disqualified
Capital Stock, such fair market value to be determined in good faith by the
board of directors of the issuer (or managing general partner of the issuer) of
such Disqualified Capital Stock.
"Interest Swap and Hedging Obligation" means any obligation of any person
pursuant to any interest rate swap agreement, interest rate cap agreement,
interest rate collar agreement, interest rate exchange agreement, currency
exchange agreement or any other agreement or arrangement designed to protect
against fluctuations in interest rates or currency values, including, without
limitation, any arrangement whereby, directly or indirectly, such person is
entitled to receive from time to time periodic payments calculated by applying
either a fixed or floating rate of interest on a stated notional amount in
exchange for periodic payments made by such person calculated by applying a
fixed or floating rate of interest on the same notional amount.
"Investment" by any person in any other person means, with respect to a
series of Debt Securities (without duplication), (a) the acquisition (whether
by purchase, merger, consolidation or otherwise) by such person (whether for
cash, property, services, securities or otherwise) of capital
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stock, bonds, notes, debentures, partnership or other ownership interests or
other securities, including any options or warrants, of such other person or
any agreement to make any such acquisition; (b) the making by such person of
any deposit with, or advance, loan or other extension of credit to, such
other person (including the purchase of property from another person subject
to an understanding or agreement, contingent or otherwise, to resell such
property to such other person) or any commitment to make any such advance,
loan or extension (but excluding accounts receivable or deposits arising in
the ordinary course of business); (c) other than guarantees of Indebtedness
of the Company or any Subsidiary to the extent permitted by the covenant
"Limitation on Incurrence of Additional Indebtedness and Disqualified Capital
Stock" (to the extent applicable to such series), the entering into by such
person of any guarantee of, or other credit support or contingent obligation
with respect to, Indebtedness or other liability of such other person; (d)
the making of any capital contribution by such person to such other person;
and (e) the designation by the Board of Directors of the Company of any
person to be an Unrestricted Subsidiary. The Company shall be deemed to make
an Investment in an amount equal to the fair market value of the net assets
of any subsidiary (or, if neither the Company nor any of its Subsidiaries has
theretofore made an Investment in such subsidiary, in an amount equal to the
Investments being made), at the time that such subsidiary is designated an
Unrestricted Subsidiary, and any property transferred to an Unrestricted
Subsidiary from the Company or a Subsidiary shall be deemed an Investment
valued at its fair market value at the time of such transfer.
"Investment Grade Rating" means a rating equal to or higher than Baa3 (or
the equivalent) by Moody's (or any successor to the rating agency business
thereof) or BBB- (or the equivalent) by S&P (or any successor to the rating
agency business thereof).
"Investment Grade Status" means, with respect to a series of Debt
Securities, any time at which the ratings of such series of Debt Securities by
both Moody's (or any successor to the rating agency business thereof) and S&P
(or any successor to the rating agency business thereof) are Investment Grade
Ratings.
"Issue Date" means, with respect to a series of Debt Securities, the date
of first issuance of such Debt Securities under the Indenture.
"Junior Security" means, with respect to a series of Debt Securities,
any Qualified Capital Stock and any Indebtedness of an Issuer or a Guarantor,
if any, as applicable, that (i) is subordinated in right of payment to Senior
Debt at least to the same extent as such series of Debt Securities or a
Guarantee, if any, as applicable, (ii) has no scheduled installment of
principal due, by redemption, sinking fund payment or otherwise, on or prior
to the Stated Maturity, (iii) does not have covenants or default provisions
materially more beneficial to the holders of such series of Debt Securities
than those in effect with respect to such series of Debt Securities on the
Issue Date and (iv) was authorized by an order or decree of a court of
competent jurisdiction that gave effect to (and states in such order or
decree that effect has been given to) the subordination of such securities to
all Senior Debt of the applicable Issuer or Guarantor, if any, not paid in
full in cash or Cash Equivalents in connection with such reorganization;
provided that all such Senior Debt is assumed by the reorganized corporation
and the rights of the holders of any such Senior Debt are not, without the
consent of such holders, altered by such reorganization, which consent shall
be deemed to have been given if the holders of such Senior Debt, individually
or as a class, shall have approved such reorganization.
"Lien" means any mortgage, charge, pledge, lien (statutory or otherwise),
privilege, security interest, hypothecation or other encumbrance upon or with
respect to any property of any kind, real or personal, movable or immovable, now
owned or hereafter acquired.
"Moody's" means Moody's Investors Service, Inc.
"Net Cash Proceeds" means, with respect to a series of Debt Securities,
the aggregate amount of cash or Cash Equivalents received by the Company in
the case of a sale of Qualified Capital Stock and by the Company and its
Subsidiaries in respect of an Asset Sale plus, in the case of an issuance of
Qualified Capital Stock upon any exercise, exchange or conversion of
securities (including options, warrants, rights and convertible or
exchangeable debt) of the Company that were issued for cash on or after the
Issue Date, the amount of cash originally received by the Company upon the
issuance of such securities (including options, warrants, rights and
convertible or exchangeable debt) less, in each case, the sum of all
payments, fees, commissions and reasonable and customary expenses (including,
without limitation, the fees and expenses of legal counsel and investment
banking fees and expenses) incurred in connection with such Asset Sale or
sale of Qualified Capital Stock, and, in the case of an Asset Sale only, less
the amount (estimated reasonably and in good faith by the Company) of income,
franchise, sales and other applicable taxes required to be paid by the
Company or any of its respective Subsidiaries in connection with such Asset
Sale.
"Non-Recourse Indebtedness" means Indebtedness of a person to the extent
that under the terms thereof or pursuant to applicable law (i) no personal
recourse shall be had against such person for the payment of the principal of or
interest or premium, if any, on such Indebtedness, and (ii) enforcement of
obligations on such Indebtedness is limited only to recourse against interests
in property purchased with the proceeds of the incurrence of such Indebtedness
and as to which none of the Issuers or any of their Subsidiaries provides any
credit support or is liable.
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"Paradise Island Expansion Opening" means the time when the Company's
approximately $450 million expansion of its Atlantis Resort & Casino property
located on Paradise Island, The Bahamas shall have been substantially completed
and the new hotel and casino comprising the expansion shall be ready for
occupancy and operation.
"Permitted Holder" means Solomon Kerzner, his immediate family or a trust
or similar entity existing solely for his benefit or for the benefit of his
immediate family.
"Permitted Indebtedness" means, with respect to a series of Debt
Securities and any accompanying Guarantees, Indebtedness incurred as follows:
(a) the Issuers and the Guarantors, if any, may incur Indebtedness (i)
pursuant to the Credit Agreement up to an aggregate principal amount outstanding
(including any Indebtedness issued to refinance, refund or replace such
Indebtedness) at any time of $375 million (excluding any amounts with respect to
Interest Swap and Hedging Obligations) (which amount may be increased to $500
million upon the later to occur of the Paradise Island Expansion Opening or
December 31, 1998), minus the amount of any such Indebtedness retired with Net
Cash Proceeds from any Asset Sale or assumed by a transferee in an Asset Sale
(provided any commitment in respect of such Indebtedness is permanently reduced)
and (ii) with respect to Interest Swap and Hedging Obligations entered into for
bona fide hedging purposes and not entered into for speculative purposes;
(b) the Issuers and the Guarantors, if any, may incur Indebtedness
evidenced by such series of Debt Securities and such Guarantees, if any, and
represented by the Indenture up to the amounts specified therein as of the
date thereof;
(c) the Issuers and the Guarantors, if any, may incur FF&E Indebtedness
on or after the Issue Date; provided, that (i) such FF&E Indebtedness is
Non-Recourse Indebtedness and (ii) such Indebtedness shall not constitute
more than 100% of the cost (determined in accordance with GAAP) to the
Issuers or the Guarantors, if any, as applicable, of the property so
purchased or leased;
(d) the Issuers and the Guarantors, if any, may incur Indebtedness solely
in respect of bankers' acceptances and performance bonds (to the extent that
such incurrence does not result in the incurrence of any obligation to repay any
obligation relating to borrowed money of others), all in the ordinary course of
business in accordance with customary industry practices, in amounts and for the
purposes customary in their industry;
(e) the Issuers may incur Indebtedness to any wholly owned Subsidiary, and
any wholly owned Subsidiary may incur Indebtedness to any other wholly owned
Subsidiary or to an Issuer; provided, that, in the case of Indebtedness of the
Issuers (other than Indebtedness that is required to be pledged to the lenders
under the Credit Agreement), such obligations shall be unsecured and
subordinated in all respects to the Issuers' obligations pursuant to the Debt
Securities of such series, and the date of any event that causes a Subsidiary to
no longer be a wholly owned Subsidiary shall be an Incurrence Date; and
(f) the Issuers and their Subsidiaries, as applicable, may incur
Refinancing Indebtedness with respect to any Indebtedness or Disqualified
Capital Stock, as applicable, described in clauses (b) and (f) of this
definition or incurred under the Debt Incurrence Ratio contained in the
covenant "Limitation on Incurrence of Additional Indebtedness and
Disqualified Capital Stock" (to the extent applicable to such series) or
which is outstanding on the Issue Date so long as such Refinancing
Indebtedness is secured only by the assets that secured the Indebtedness so
refinanced or otherwise replaced.
"Permitted Investment" means, with respect to a series of Debt
Securities, (a) any Investment in any of the Debt Securities of such series,
(b) any Investment in Cash Equivalents, (c) any Investment in intercompany
notes to the extent permitted under clause (b) of the definition of
"Permitted Indebtedness", (d) any Investment in a person in a Related
Business who, after such Investment, becomes a Subsidiary of an Issuer and a
Guarantor of the Debt Securities of such series (if so required) and (e) any
Investment in any property or assets to be used by an Issuer or any Guarantor
in a Related Business.
"Permitted Lien" means, with respect to a series of Debt Securities, (a)
any Lien securing the Debt Securities of such series, (b) any Lien securing
Indebtedness of a Person existing at the time such Person becomes a
Subsidiary or is merged with or into either of the Issuers or a Subsidiary of
either of the Issuers or Liens securing Indebtedness incurred in connection
with an Acquisition; provided that such Liens were in existence prior to the
date of such acquisition, merger or consolidation, were not incurred in
anticipation thereof, and do not extend to any other assets, (c) any Lien in
favor of either of the Issuers or any Guarantor and (d) any Lien arising from
FF&E Indebtedness permitted to be incurred under clause (c) of the definition
of "Permitted Indebtedness"; provided such Lien relates solely to the
property which is subject to such FF&E Indebtedness.
"Public Equity Offering" means an underwritten public offering of Common
Stock of the Company.
"Qualified Capital Stock" means any Capital Stock of the Company that is
not Disqualified Capital Stock.
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"Qualified Exchange" means, with respect to a series of Debt Securities,
any legal defeasance, redemption, retirement, repurchase or other acquisition
of Capital Stock or Indebtedness of the Company issued on or after the Issue
Date with the Net Cash Proceeds received by the Company from the
substantially concurrent sale of Qualified Capital Stock or any exchange of
Qualified Capital Stock for any Capital Stock or Indebtedness of the Company
issued on or after the Issue Date.
"Rating Agencies" means S&P and Moody's or any successor to the respective
rating agency businesses thereof.
"Reference Period" with regard to any person means, with respect to a
series of Debt Securities, the four full fiscal quarters (or such lesser
period during which such person has been in existence) ended immediately
preceding any date upon which any determination is to be made pursuant to the
terms of the Debt Securities of such series or the Indenture.
"Refinancing Indebtedness" means, with respect to a series of Debt
Securities, Indebtedness or Disqualified Capital Stock (a) issued in exchange
for, or the proceeds from the issuance and sale of which are used substantially
concurrently to repay, redeem, defease, refund, refinance, discharge or
otherwise retire for value, in whole or in part, or (b) constituting an
amendment, modification or supplement to, or a deferral or renewal of ((a) and
(b) above are, collectively, a "Refinancing"), any Indebtedness or Disqualified
Capital Stock in a principal amount or, in the case of Disqualified Capital
Stock, liquidation preference, not to exceed (after deduction of reasonable and
customary fees and expenses incurred in connection with the Refinancing) the
lesser of (i) the principal amount or, in the case of Disqualified Capital
Stock, liquidation preference, of the Indebtedness or Disqualified Capital Stock
so Refinanced and (ii) if such Indebtedness being Refinanced was issued with an
original issue discount, the accreted value thereof (as determined in accordance
with GAAP) at the time of such Refinancing; provided that (A) such Refinancing
Indebtedness of any Subsidiary of the Company shall only be used to Refinance
outstanding Indebtedness or Disqualified Capital Stock of such Subsidiary, (B)
such Refinancing Indebtedness shall (x) not have an Average Life shorter than
the Indebtedness or Disqualified Capital Stock to be so refinanced at the time
of such Refinancing and (y) in all respects, be no less subordinated or junior,
if applicable, to the rights of holders of such series of Debt Securities than
was the Indebtedness or Disqualified Capital Stock to be refinanced and (C) such
Refinancing Indebtedness shall have a final stated maturity or redemption date,
as applicable, no earlier than the final stated maturity or redemption date, as
applicable, of the Indebtedness or Disqualified Capital Stock to be so
refinanced.
"Related Business" means the gaming or hotel business and other businesses
necessary for, or in the good faith judgment of the Board of Directors of the
Company, incident to, connected with, arising out of, or developed or operated
to permit or facilitate the conduct or pursuit of the gaming or hotel business
(including developing or operating sports or entertainment facilities, retail
facilities, restaurants, night clubs, transportation and communications services
or other related activities or enterprises and any additions or improvements
thereto) and potential opportunities in the gaming or hotel business.
"Representative" means The Bank of Nova Scotia or any successor or
successors under the Credit Agreement.
"Restricted Payment" means, with respect to any person, (a) the declaration
or payment of any dividend or other distribution in respect of Equity Interests
of such person or any parent or Subsidiary of such person, (b) any payment on
account of the purchase, redemption or other acquisition or retirement for value
of Equity Interests of such person or any Subsidiary or parent of such person,
(c) other than with the proceeds from the substantially concurrent sale of, or
in exchange for, Refinancing Indebtedness, any purchase, redemption, or other
acquisition or retirement for value of, any payment in respect of any amendment
of the terms of or any defeasance of, any Subordinated Indebtedness, directly or
indirectly, by such person or a parent or Subsidiary of such person prior to the
scheduled maturity, any scheduled repayment of principal, or scheduled sinking
fund payment, as the case may be, of such Indebtedness and (d) any Investment by
such person, other than a Permitted Investment; provided, that the term
"Restricted Payment" does not include (i) any dividend, distribution or other
payment on or with respect to Equity Interests of an Issuer to the extent
payable solely in shares of Qualified Capital Stock of such Issuer or (ii) any
dividend, distribution or other payment to the Issuers, or to any Guarantors, if
any, by the Company or any of its Subsidiaries.
"S&P" means Standard and Poor's Ratings Group, a division of the
McGraw-Hill Companies, Inc.
"Senior Debt" of the Company, SINA or any Guarantor means, with respect
to a series of Debt Securities, Indebtedness (including and together with all
monetary obligations in respect of the Credit Agreement, and interest,
whether or not allowable, accruing on Indebtedness incurred pursuant to the
Credit Agreement after the filing of a petition initiating any proceeding
under any bankruptcy, insolvency or similar law or which would have accrued
but for such filing) of the Company, SINA or such Guarantor, if any, arising
under the Credit Agreement or that, by the terms of the instrument creating or
evidencing such Indebtedness, is expressly designated Senior Debt and made
senior in right of payment to such series of Debt Securities or any
applicable Guarantee, if any; provided, that in no event shall Senior Debt
include (a) Indebtedness to any Subsidiary of the Company or any officer,
director or employee of the Company or any Subsidiary of the Company (other
than Indebtedness that is required to be pledged to the lenders under the
Credit Agreement), (b) Indebtedness incurred in
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<PAGE>
violation of the terms of the Indenture or the Debt Securities of such
series, (c) Indebtedness to trade creditors, (d) Disqualified Capital Stock,
and (e) any liability for taxes owed or owing by the Company, SINA or any
Guarantor, if any.
"Significant Subsidiary" shall, with respect to a series of Debt
Securities,have the meaning provided under Regulation S-X under the Securities
Act as in effect on the Issue Date of such series.
"Stated Maturity" means, with respect to a series of Debt Securities,
the date specified in the Debt Securities of such series as the fixed date on
which the payment of principal of the Debt Securities of such series is due
and payable, including pursuant to any mandatory redemption provision (but
excluding any provision providing for the repurchase of the Debt Securities
of such series at the option of the holder thereof upon the happening of any
contingency beyond the control of the Issuers unless such contingency has
occurred).
"Subordinated Indebtedness" means, with respect to a series of Debt
Securities or any Guarantee, Indebtedness of the Company, SINA or such
Guarantor, if any, that is subordinated in right of payment to such series of
Debt Securities or such Guarantee, if any, as applicable, in any respect or,
for purposes of the definition of Restricted Payments only, has a stated
maturity on (except for such series of Debt Securities) or after the Stated
Maturity.
"Subsidiary", with respect to any person, means (i) a corporation a
majority of whose Equity Interests with voting power, under ordinary
circumstances, to elect directors is at the time, directly or indirectly, owned
by such person, by such person and one or more Subsidiaries of such person or by
one or more Subsidiaries of such person, (ii) any other person (other than a
corporation) in which such person, one or more Subsidiaries of such person, or
such person and one or more Subsidiaries of such person, directly or indirectly,
at the date of determination thereof has at least majority ownership interest,
or (iii) a partnership in which such person or a Subsidiary of such person is,
at the time, a general partner. Notwithstanding the foregoing, an Unrestricted
Subsidiary shall not be a Subsidiary of the Company or any Subsidiary of the
Company. Unless the context requires otherwise, Subsidiary means each direct and
indirect Subsidiary of the Company.
"Unrestricted Subsidiary" means, with respect to a series of Debt
Securities, any subsidiary of the Company (other than SINA) that does not own
any Capital Stock of, or own or hold any Lien on any property of, the Company
or any other Subsidiary of the Company or SINA and that shall be designated
an Unrestricted Subsidiary by the Board of Directors of the Company;
provided, that (i) such subsidiary shall not engage, to any substantial
extent, in any line or lines of business activity other than a Related
Business, (ii) neither immediately prior thereto nor after giving pro forma
effect to such designation would there exist a Default or Event of Default
and (iii) immediately after giving pro forma effect thereto, the Company
could incur at least $1.00 of Indebtedness pursuant to the Debt Incurrence
Ratio in the covenant "Limitation on Incurrence of Additional Indebtedness
and Disqualified Capital Stock" (to the extent applicable to such series of
Debt Securities). The Board of Directors of the Company may designate any
Unrestricted Subsidiary to be a Subsidiary; provided, that (i) no Default or
Event of Default is existing or will occur as a consequence thereof and (ii)
immediately after giving effect to such designation, on a pro forma basis,
the Company could incur at least $1.00 of Indebtedness pursuant to the Debt
Incurrence Ratio in the covenant "Limitation on Incurrence of Additional
Indebtedness and Disqualified Capital Stock" (to the extent applicable to
such series of Debt Securities). Each such designation shall be evidenced by
filing with the Trustee a certified copy of the resolution giving effect to
such designation and an Officers' Certificate certifying that such
designation complied with the foregoing conditions.
"wholly owned Subsidiary" means a Subsidiary all the Equity Interests of
which are owned by the Company or one or more wholly owned Subsidiaries of the
Company, except for directors' qualifying shares.
CERTAIN BAHAMIAN TAX CONSIDERATIONS
The Bahamas does not impose any income, capital gains or withholding taxes.
Therefore, interest and principal paid on the Debt Securities will not be
subject to any Bahamas withholding taxes.
PLAN OF DISTRIBUTION
The Issuers may sell the Debt Securities through underwriters, through or
to dealers, directly to one or more purchasers, or through agents. Each
Prospectus Supplement with respect to the Debt Securities offered hereby will
set forth the terms of the offering of the applicable Debt Securities, including
the name or names of any underwriters, dealers or agents, the purchase price of
the Debt Securities and the proceeds to the Issuers from such sale, any delayed
delivery arrangements, any underwriting discounts and other items constituting
underwriters' compensation, the initial public offering price, any discounts or
concessions allowed or re-allowed or paid to dealers and any securities
exchanges on which the Debt Securities may be listed.
If underwriters are used in the sale, the Debt Securities will be acquired
by the underwriters for their own account and may be resold from time to time in
one or more transactions, including negotiated transactions, at a fixed public
offering price or at varying prices determined at the time of sale. The Debt
Securities may be offered to the public either through
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<PAGE>
underwriting syndicates represented by one or more managing underwriters or
directly by one or more firms acting as underwriters. The underwriter or
underwriters with respect to a particular underwritten offering of Debt
Securities will be named in the Prospectus Supplement relating to such offering,
and if an underwriting syndicate is used, the managing underwriter or
underwriters will be set forth on the cover of such Prospectus Supplement.
Unless otherwise set forth in the Prospectus Supplement relating thereto, the
obligations of the underwriters or agents to purchase the Debt Securities will
be subject to conditions precedent and the underwriters will be obligated to
purchase all the Debt Securities if any are purchased. The initial public
offering price and any discounts or concessions allowed or re-allowed or paid to
dealers may be changed from time to time.
If dealers are used in the sale of Debt Securities with respect to which
this Prospectus is delivered, the Issuers will sell such Debt Securities to the
dealers as principals. The dealers may then resell such Debt Securities to the
public at varying prices to be determined by such dealers at the time of resale.
The names of the dealers and the terms of the transaction will be set forth in
the Prospectus Supplement relating thereto.
Debt Securities may be sold directly by the Issuers or through agents
designated by the Issuers from time to time at fixed prices, which may be
changed, or at varying prices determined at the time of sale. Any agent involved
in the offer or sale of the Debt Securities with respect to which this
Prospectus is delivered will be named, and any commissions payable by the Issuer
to such agent will be set forth in the Prospectus Supplement relating thereto.
Unless otherwise indicated in the Prospectus Supplement, any such agent will be
acting on a best efforts basis for the period of its appointment.
In connection with the sale of the Debt Securities, underwriters or agents
may receive compensation from the Issuers or from purchasers of Debt Securities
from whom they may act as agents in the form of discounts, concessions, or
commissions. Underwriters, agents and dealers participating in the distribution
of the Debt Securities may be deemed to be underwriters, and any discounts or
commissions received by them from the Issuers and any profit on the resale of
the Debt Securities by them may be deemed to be underwriting discounts or
commissions under the Securities Act.
If so indicated in the Prospectus Supplement, the Issuers will authorize
agents, underwriters, or dealers to solicit offers from certain types of
institutions to purchase Debt Securities from the Issuers at the public offering
price set forth in such Prospectus Supplement pursuant to delayed delivery
contracts providing for payment and delivery on a specified date in the future.
Such contracts will be subject only to those conditions set forth in such
Prospectus Supplement, and the Prospectus Supplement will set forth the
commission payable for solicitation of such contracts.
Agents, dealers, and underwriters may be entitled under agreements entered
into with the Issuers to indemnification by the Issuers against certain civil
liabilities, including liabilities under the Securities Act, or to contribution
with respect to payments that such agents, dealers, or underwriters may be
required to make with respect thereto. Agents, dealers, and underwriters may be
customers of, engage in transactions with, or perform services for the Issuers
in the ordinary course of business.
The Debt Securities may or may not be listed on a national securities
exchange. No assurances can be given that there will be a market for the Debt
Securities.
LEGAL MATTERS
Certain legal matters with respect to the legality of the Debt Securities
will be passed upon for the Issuers and the Guarantors, if any, by Charles D.
Adamo, Esq., General Counsel for the Issuers, with respect to matters of United
States law, New York law and the General Corporation Law of Delaware, Giselle M.
Pyfrom, Esq., Associate General Associate for the Company and certain
Guarantors, with respect to matters of Bahamian law, Smith-Hughes, Raworth &
McKenzie with respect to British Virgin Islands law, Kozlov, Seaton, Romanini,
Brooks & Greenberg with respect to New Jersey law and Rome McGuigan Sabanosh,
P.C. with respect to Connecticut law. Certain matters will be passed upon for
any underwriters or agents by a firm named in the Prospectus Supplement relating
to a particular issue of Debt Securities. Mr. Adamo and Ms. Pyfrom each own and
have options to purchase ordinary shares of the Company.
EXPERTS
The consolidated financial statements of Sun International Hotels Limited
for the years ended December 31, 1994, 1995 and 1996 incorporated by reference
herein, to the extent and for the periods indicated in the reports thereon, have
been audited by Arthur Andersen LLP, independent public accountants, and are
included herein in reliance upon the authority of such firm as experts in
accounting and auditing.
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<PAGE>
The consolidated financial statements of SINA appearing in SINA's Annual
Report (Form 10-K) for the year ended December 31, 1996, have been audited by
Ernst & Young LLP, independent auditors, as set forth in their report thereon
included therein and incorporated herein by reference. Such consolidated
financial statements are incorporated herein by reference in reliance upon such
report given upon the authority of such firm as experts in accounting and
auditing.
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<PAGE>
PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the expenses to be borne by the Issuers in
connection with the issuance and distribution of the Debt Securities being
registered, other than underwriting discounts and commissions. All of such
amounts are estimated except for the SEC Registration Fee.
Registration......................................... $ 90,909
Trustee Fees......................................... 10,000
Printing............................................. 30,000
Accounting Fees...................................... 30,000
Legal Fees........................................... 80,000
Blue Sky Fees and Expenses........................... 10,000
Rating Agency Fees................................... 100,000
Miscellaneous........................................ 49,091
--------
Total................................................ $400,000
========
Item 15. Indemnification of Directors and Officers.
Sun International Hotels Limited. Section 56 of the Companies Act empowers
a company incorporated under the Companies Act to indemnify against all
expenses, including legal fees, and against all judgements, fines and amounts
paid in settlement and reasonably incurred in connection with legal,
administrative or investigative proceedings any person who (a) is or was a party
or is threatened to be made a party to any threatened, pending or completed
proceedings, whether civil, criminal, administrative or investigative, by reason
of the fact that the person is or was a director, an officer or a liquidator of
the company or (b) is or was, at the request of the company, serving as a
director, officer or liquidator of, or in any other capacity is or was acting
for, another company or a partnership, joint venture, trust or other enterprise,
provided, however, that such indemnification may only be provided to a person if
the person acted honestly and in good faith with a view to the best interests of
the company and, in the case of criminal proceedings, the person had no
reasonable cause to believe that his conduct was unlawful. The decision of the
directors as to whether the person acted honestly and in good faith and with a
view to the best interests of the company and as to whether the person had no
reasonable cause to believe that his conduct was unlawful is, in the absence of
fraud, sufficient for the purposes of the Companies Act unless a question of law
is involved.
The Company provides for indemnification of its directors and officers
pursuant to Article 85 of its Articles of Association which provides that, net
of any indemnification an officer or director of the Company receives from
another source, the Company will indemnify its officers and directors to the
fullest extent permitted by the Companies Act.
The Company has purchased directors' and officers' liability insurance
policies indemnifying its officers and directors and the officers and directors
of its subsidiaries (including SINA) against claims and liabilities (with stated
exceptions) to which they may become subject by reason of their positions with
the Company or its subsidiaries as directors and officers.
Sun International North America, Inc. Subsection (a) of Section 145 of the
General Corporation Law of Delaware empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action, suit or proceeding, whether civil,
criminal, administrative or investigative (other than an action by or in the
right of the corporation) by reason of the fact that he is or was a director,
officer, employee or agent of the corporation, or is or was serving at the
request of the corporation as a director, officer, employee or agent of another
corporation, or is or was serving at the request of the corporation as a
director, officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, against expenses (including attorneys'
fees), judgments, fines and amounts paid in settlement actually and reasonably
incurred by him in connection with such action, suit or proceeding if he acted
in good faith and in a manner he reasonably believed to be in or not opposed to
the best interests of the corporation and, with respect to any criminal action
or proceeding, had no reasonable cause to believe his conduct was unlawful.
Subsection (b) of Section 145 empowers a corporation to indemnify any
person who was or is a party or is threatened to be made a party to any
threatened, pending or completed action or suit by or in the right of the
corporation to procure a
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judgment in its favor by reason of the fact that such person acted in any of the
capacities set forth above, against expenses (including attorneys' fees)
actually and reasonably incurred by him in connection with the defense or
settlement or such action or suit if he acted in good faith and in a manner he
reasonably believes to be in or not opposed to the best interests of the
corporation, except that no indemnification shall be made in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the corporation unless and only to the extent that the Delaware Court
of Chancery or the court in which such action or suit was brought shall
determine that, despite the adjudication of liability but in view of all the
circumstances of the case, such person is fairly and reasonably entitled to
indemnity for such expenses which the Delaware Court of Chancery or such other
court shall deem proper.
Section 145 further provides that to the extent a director, officer,
employee or agent of a corporation has been successful on the merits or
otherwise in the defense of any action, suit or proceeding referred to in
subsections (a) and (b) of such Subsection 145 or in the defense of any claim,
issue or matter therein, he shall be indemnified against expenses (including
attorneys' fees) actually and reasonably incurred by him in connection
therewith. It also provides that indemnification provided for by Section 145
shall not be deemed exclusive of any other rights to which the indemnified party
may be entitled, and it empowers a corporation to purchase and maintain
insurance on behalf of any person who is or was a director, officer, employee or
agent of the corporation or is or was serving at the request of the corporation
as a director, officer, employee or agent of another corporation, partnership,
joint venture, trust or other enterprise against any liability asserted against
him or incurred by him in any such capacity or arising out of his status as
such, whether or not the corporation would have the power to indemnify him
against such liabilities under Section 145.
The Certificate of Incorporation of SINA (the "Certificate") provides that
a director of SINA shall not be personally liable to SINA or its stockholders
for monetary damages for breach of fiduciary duty as a director except for
liability (i) for any breach of the director's duty of loyalty to SINA or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174 of
the Delaware General Corporation Law, or (iv) for any transaction from which the
director derived an improper personal benefit. The Certificate also provides
that if the Delaware General Corporation Law is amended after the Effective Date
(as defined in the Certificate) to authorize corporate action further
eliminating or limiting the personal liability of directors, then the liability
of a director of SINA shall be eliminated or limited to the fullest extent
permitted by the Delaware General Corporation Law, as so amended.
Item 16. Exhibits.
*1.1 Form of Underwriting Agreement.
4.1 Form of Indenture.
**5.1 Opinion of Charles D. Adamo, Esq.
**5.2 Opinion of Giselle M. Pyfrom, Esq.
**5.3 Opinion of Kozlov, Seaton, Romanini, Brooks & Greenberg.
**5.4 Opinion of Rome McGuigan Sabanosh, P.C.
**5.5 Opinion of Smith-Hughes Raworth & McKenzie.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Ernst & Young LLP.
23.3 Consent of Charles D. Adamo, Esq. (included in Exhibit 5.1).
23.4 Consent of Giselle M. Pyfrom, Esq. (included in Exhibit 5.2).
23.5 Consent of Kozlov, Seaton, Romanini, Brooks & Greenberg
(included in Exhibit 5.3).
23.6 Consent of Rome McGuigan Sabanosh, P.C. (included in Exhibit 5.4).
23.7 Consent of Smith-Hughes Raworth & McKenzie (included in Exhibit 5.5).
**24.1 Power of Attorney for Sun International Hotels Limited.
**24.2 Power of Attorney for Sun International North America, Inc.
**24.3 Power of Attorney for Sun International Bahamas Limited.
**24.4 Power of Attorney for Paradise Acquisitions Limited.
**24.5 Power of Attorney for Paradise Island Limited.
**24.6 Power of Attorney for Paradise Enterprises Limited.
**24.7 Power of Attorney for Island Hotel Company Limited.
**24.8 Power of Attorney for Paradise Beach Inn Limited.
**24.9 Power of Attorney for Sun International Management Limited.
**24.10 Power of Attorney for GGRI, Inc.
**24.11 Power of Attorney for Resorts International Hotel, Inc.
**24.12 Power of Attorney for Sun Cove, Ltd.
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25.1 Statement of Eligibility and Qualification on Form T-1 of the Trustee
under the Indenture.
- -----------
* To be filed by Current Reports on Form 6-K (with respect to the
Company) and Form 8-K (with respect to SINA) pursuant to Item 601 of
Regulation S-K.
** Previously filed.
Item 17. Undertakings.
(a) Rule 415 Offering.
The undersigned registrants hereby undertake:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) to include any prospectus required by section 10(a)(3) of the
Securities Act of 1933; (ii) to reflect in the prospectus any
facts or events arising after the effective date of the
registration statement (or the most recent post-effective
amendment thereof) which, individually or in the aggregate,
represent a fundamental change in the information set forth in
the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the
total dollar value of securities offered would not exceed that
which was registered) and any deviation from the low or high end
of the estimated maximum offering range may be reflected in the
form of prospectus filed with the Commission pursuant to Rule
424(b) if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee"
table in the effective registration statement; and (iii) to
include any material information with respect to the plan of
distribution not previously disclosed in the registration
statement or any material change to such information in the
registration statement; provided, however, that paragraphs
(a)(l)(i) and (l)(ii) do not apply if the information required to
be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed with or furnished to the
Commission by such registrants pursuant to section 13 or section
15(d) of the Securities Exchange Act of 1934 that are
incorporated by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall
be deemed to be a new registration statement relating to the
securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering
thereof.
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain
unsold at the termination of the offering.
(4) To file a post-effective amendment to the registration statement
to include any financial statements required by 17 C.F.R. ss.
210.3-19 at the start of any delayed offering or throughout a
continuous offering. Financial statements and information
otherwise required by Section 10(a)(3) of the Securities Act of
1933 need not be furnished, provided that the registrants include
in the prospectus, by means of a post-effective amendment,
financial statements required pursuant to this paragraph (a)(4)
and other information necessary to ensure that all other
information in the prospectus is at least as current as the date
of those financial statements. Notwithstanding the foregoing,
with respect to registration statements on Form F-3, a
post-effective amendment need not be filed to include financial
statements and information required by Section 10(a)(3) of the
Act or 17 C.F.R. ss. 210.3-19 if such financial statements and
information are contained in periodic reports filed with or
furnished to the Commission by the registrants pursuant to
section 13 or section 15(d) of the Securities Exchange Act of
1934 that are incorporated by reference in the Form F-3.
(b) The undersigned registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each
filing of the registrants' annual reports pursuant to Section 13(a) or
Section 15(d) of the Securities Exchange Act of 1934 that is
incorporated by reference in the registration statement shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
(c) Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and
controlling persons of the registrants pursuant to the foregoing
provisions, or otherwise, the registrants have been advised that in
the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in said Act and
is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by
the registrants of expenses incurred or paid by
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a director, officer or controlling person of the registrants in the
successful defense of any action, suit or proceeding) is asserted by
such director, officer or controlling person in connection with the
securities being registered, the registrants will, unless in the
opinion of their counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question
whether such indemnification by them is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
(d) The undersigned registrants hereby undertake to file an application
for the purpose of determining the eligibility of the trustee under
subsection (a) of Section 310 of the Trust Indenture Act (the "Act")
in accordance with the rules and regulations prescribed by the
Commission under Section 305(b)(2) of the Act.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Sun International Hotels Limited
By /s/ Giselle M. Pyfrom
-------------------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
Chairman of the Board of Directors
* and Chief Executive Officer December 3, 1997
- ---------------- (Principal Executive Officer)
Solomon Kerzner
* Director December 3, 1997
- ----------------
Derek Hawton
* Director December 3, 1997
- ----------------
Peter Buckley
* Director December 3, 1997
- ----------------
Howard Marks
* Director December 3, 1997
- ----------------
Eric Siegel
Chief Financial Officer and Secretary
/s/ John Allison (Principal Financial and Accounting December 3, 1997
- ---------------- Officer and Authorized Representative
John Allison in the United States)
*By: /s/ John Allison
---------------------
John Allison
Attorney-in-Fact
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SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Sun International North America, Inc.
By /s/ Giselle M. Pyfrom
----------------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
Chairman of the Board of Directors
* and Chief Executive Officer December 3, 1997
------------------- (Principal Executive Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
------------------- and Accounting Officer)
Kevin DeSanctis
* Director December 3, 1997
- --------------------
Charles D. Adamo
*By: /s/ John Allison
------------------------
John Allison
Attorney-in-Fact
II-6
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Sun International Bahamas Limited
By /s/ Giselle M. Pyfrom
------------------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signature
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
* Director (Principal Executive December 3, 1997
- --------------------- Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
- --------------------- and Accounting Officer)
Kevin DeSanctis
* Director December 3, 1997
- ---------------------
Charles D. Adamo
/s/ John Allison Authorized Representative December 3, 1997
- --------------------- in the United States
John Allison
*By: /s/ John Allison
----------------------
John Allison
Attorney-in-Fact
II-7
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Paradise Acquisitions Limited
By /s/ Giselle M. Pyfrom
------------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
* Director (Principal Executive December 3, 1997
--------------------- Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
--------------------- and Accounting Officer)
Kevin DeSanctis
* Director December 3, 1997
---------------------
Charles D. Adamo
/s/ John Allison Authorized Representative in December 3, 1997
--------------------- the United States
John Allison
*By: /s/ John Allison
---------------------
John Allison
Attorney-in-Fact
II-8
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Paradise Island Limited
By /s/ Giselle M. Pyfrom
----------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
* Director (Principal Executive December 3, 1997
--------------------- Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
--------------------- and Accounting Officer)
Kevin DeSanctis
* Director December 3, 1997
---------------------
Charles D. Adamo
/s/ John Allison Authorized Representative December 3, 1997
--------------------- in the United States
John Allison
*By: /s/ John Allison
----------------------
John Allison
Attorney-in-Fact
II-9
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Paradise Enterprises Limited
By /s/ Giselle M. Pyfrom
-------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
* Director (Principal Executive December 3, 1997
--------------------- Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
--------------------- and Accounting Officer)
Kevin DeSanctis
* Director December 3, 1997
---------------------
Charles D. Adamo
/s/ John Allison Authorized Representative December 3, 1997
--------------------- in the United States
John Allison
*By: /s/ John Allison
----------------------
John Allison
Attorney-in-Fact
II-10
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Island Hotel Company Limited
By /s/ Giselle M. Pyfrom
------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
* Director (Principal Executive December 3, 1997
--------------------- Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
--------------------- and Accounting Officer)
Kevin DeSanctis
* Director December 3, 1997
---------------------
Charles D. Adamo
/s/ John Allison Authorized Representative December 3, 1997
--------------------- in the United States
John Allison
*By: /s/ John Allison
----------------------
John Allison
Attorney-in-Fact
II-11
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Paradise Beach Inn Limited
By /s/ Giselle M. Pyfrom
----------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
* Director (Principal Executive December 3, 1997
--------------------- Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
--------------------- and Accounting Officer)
Kevin DeSanctis
December 3, 1997
* Director
---------------------
Charles D. Adamo
/s/ John Allison Authorized Representative December 3, 1997
--------------------- in the United States
John Allison
*By: /s/ John Allison
------------------------
John Allison
Attorney-in-Fact
II-12
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Sun International Management Limited
By /s/ Giselle M. Pyfrom
--------------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
Chairman of the Board of Directorse
* and Chief Executiv Officer December 3, 1997
--------------------- (Principal Executive Officer)
Solomon Kerzner
* Director (Principal Financial December 3, 1997
--------------------- and Accounting Officer)
Howard Kerzner
* Director December 3, 1997
--------------------
Charles D. Adamo
/s/ John Allison Authorized Representative December 3, 1997
--------------------- in the United States
John Allison
*By: /s/ John Allison
-----------------------
John Allison
Attorney-in-Fact
II-13
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
GGRI, Inc.
By /s/ Giselle M. Pyfrom
-------------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
Chairman of the Board of Directors
* and Chief Executive Officer December 3, 1997
--------------------- (Principal Executive Officer)
Kevin DeSanctis
/s/ John Allison Director (Principal Financial December 3, 1997
--------------------- and Accounting Officer)
John Allison
* Director December 3, 1997
---------------------
Charles D. Adamo
*By: /s/ John Allison
--------------------------
John Allison
Attorney-in-Fact
II-14
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form F-3 and has duly caused this amendment to the
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of New York, State of New York, on the
3rd day of December, 1997.
Resorts International Hotel, Inc.
By /s/ Giselle M. Pyfrom
--------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
Chairman of the Board of Directors
* (Principal Executive, Financial December 3, 1997
-------------------- and Accounting Officer)
Kevin DeSanctis
* Director December 3, 1997
--------------------
Charles D. Adamo
* Director December 3, 1997
--------------------
Howard Kerzner
*By: /s/ John Allison
----------------------------
John Allison
Attorney-in-Fact
II-15
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form F-3 and has duly caused this
amendment to the registration statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in the City of New York, State of New
York, on the 3rd day of December, 1997.
Sun Cove, Ltd.
By /s/ Giselle M. Pyfrom
-------------------------------------
Name: Giselle M. Pyfrom
Title: Authorized Signatory
Pursuant to the requirements of the Securities Act of 1933, this
amendment to the registration statement has been signed by the following
persons in the capacities and on the dates indicated.
Name Title Date
---- ----- ----
Chairman of the Board of Directors
* and Chief Executive Officer December 3, 1997
----------------- (Principal Executive Officer)
Howard Kerzner
* Director (Principal Financial December 3, 1997
----------------- and Accounting Officer)
Kevin DeSanctis
/s/ John Allison Director December 3, 1997
-----------------
John Allison
*By: /s/ John Allison
------------------------
John Allison
Attorney-in-Fact
II-16
<PAGE>
EXHIBIT INDEX
Exhibit Description
- ------- -----------
4.1 Form of Indenture.
23.1 Consent of Arthur Andersen LLP.
23.2 Consent of Ernst & Young LLP.
25.1 Statement of Eligibility and Qualification on Form T-1 of the
Trustee under the Indenture.
II-17
<PAGE>
Exhibit 4.1
================================================================================
SUN INTERNATIONAL HOTELS LIMITED
AND
SUN INTERNATIONAL NORTH AMERICA, INC.,
ISSUERS,
AND
THE GUARANTORS NAMED HEREIN
AND
[ ],
TRUSTEE
----------------------
INDENTURE
Dated as of [ ]
================================================================================
<PAGE>
CROSS-REFERENCE TABLE
TIA INDENTURE
SECTION SECTION
- ------- -------
310(a)(1). . . . . . . . . . . . . . . . . . . . 7.10
(a)(2). . . . . . . . . . . . . . . . . . . . 7.10
(a)(3). . . . . . . . . . . . . . . . . . . . N.A.
(a)(4). . . . . . . . . . . . . . . . . . . . N.A.
(a)(5). . . . . . . . . . . . . . . . . . . . 7.10
(b) . . . . . . . . . . . . . . . . . . . . 7.8;
. . . . . . . . . . . . . . . . . . . . . 7.10;
. . . . . . . . . . . . . . . . . . . . 13.2
(c) . . . . . . . . . . . . . . . . . . . . N.A.
311(a) . . . . . . . . . . . . . . . . . . . . 7.11
(b) . . . . . . . . . . . . . . . . . . . . 7.11
(c) . . . . . . . . . . . . . . . . . . . . N.A.
312(a) . . . . . . . . . . . . . . . . . . . . 2.5
(b) . . . . . . . . . . . . . . . . . . . . 13.3
(c) . . . . . . . . . . . . . . . . . . . . 13.3
313(a) . . . . . . . . . . . . . . . . . . . . 7.6
(b)(1). . . . . . . . . . . . . . . . . . . . N.A.
(b)(2). . . . . . . . . . . . . . . . . . . . 7.6
(c) . . . . . . . . . . . . . . . . . . . . 7.6;
. . . . . . . . . . . . . . . . . . . . . 13.2
(d) . . . . . . . . . . . . . . . . . . . . 7.6
314(a) . . . . . . . . . . . . . . . . . . . . 4.7;
. . . . . . . . . . . . . . . . . . . . . 4.6
(b) . . . . . . . . . . . . . . . . . . . . N.A.
(c)(1). . . . . . . . . . . . . . . . . . . . 2.2;
. . . . . . . . . . . . . . . . . . . . . 7.2;
. . . . . . . . . . . . . . . . . . . . . 13.4
(c)(2). . . . . . . . . . . . . . . . . . . . 7.2;
. . . . . . . . . . . . . . . . . . . . . 13.4
(c)(3). . . . . . . . . . . . . . . . . . . . N.A
(d) . . . . . . . . . . . . . . . . . . . . N.A
(e) . . . . . . . . . . . . . . . . . . . . 13.5
(f) . . . . . . . . . . . . . . . . . . . . N.A.
315(a) . . . . . . . . . . . . . . . . . . . . 7.1(b)
(b) . . . . . . . . . . . . . . . . . . . . 7.5;
. . . . . . . . . . . . . . . . . . . . . 7.6;
. . . . . . . . . . . . . . . . . . . . . 13.2
(c) . . . . . . . . . . . . . . . . . . . . 7.1(a)
(d) . . . . . . . . . . . . . . . . . . . . 7.2;
. . . . . . . . . . . . . . . . . . . . . 6.11;
. . . . . . . . . . . . . . . . . . . . . 7.1(c)
(e) . . . . . . . . . . . . . . . . . . . . 6.14
i
<PAGE>
TIA INDENTURE
SECTION SECTION
- ------- -------
316(a)(last sentence). . . . . . . . . . . . . . 2.9
(a)(1)(A) . . . . . . . . . . . . . . . . . 6.11
(a)(1)(B) . . . . . . . . . . . . . . . . . . 6.12
(a)(2). . . . . . . . . . . . . . . . . . . . N.A.
(b) . . . . . . . . . . . . . . . . . . . . 6.12;
. . . . . . . . . . . . . . . . . . . . . 6.8
317(a)(1). . . . . . . . . . . . . . . . . . . . 6.3
(a)(2). . . . . . . . . . . . . . . . . . . . 6.4
(b) . . . . . . . . . . . . . . . . . . . . 2.4
318(a) . . . . . . . . . . . . . . . . . . . . 13.1
- -------------------
N.A. means Not Applicable
Note: This Cross-Reference Table shall not, for any purpose, be deemed to be a
part of the Indenture.
ii
<PAGE>
TABLE OF CONTENTS
PAGE
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 Definitions.......................................................1
Section 1.2 Incorporation by Reference of TIA................................23
Section 1.3 Rules of Construction............................................23
ARTICLE II
THE SECURITIES
Section 2.1 Form and Dating..................................................24
Section 2.2 Execution and Authentication.....................................24
Section 2.4 Paying Agent to Hold Assets in Trust.............................31
Section 2.5 Securityholder Lists.............................................31
Section 2.6 Transfer and Exchange............................................31
Section 2.7 Replacement Securities...........................................36
Section 2.8 Outstanding Securities...........................................36
Section 2.9 Treasury Securities..............................................37
Section 2.10 Temporary Securities............................................37
Section 2.11 Cancelation.....................................................38
Section 2.12 Defaulted Interest..............................................38
Section 2.13 CUSIP Numbers...................................................38
ARTICLE III
REDEMPTION
Section 3.1 ..................................................................39
Section 3.2 Redemption Pursuant to Gaming Laws...............................40
Section 3.3 Notices to Trustee...............................................41
Section 3.4 Selection of Securities to Be Redeemed...........................41
Section 3.5 Notice of Redemption.............................................42
Section 3.6 Effect of Notice of Redemption...................................43
Section 3.7 Deposit of Redemption Price......................................43
Section 3.8 Securities Redeemed in Part......................................44
ARTICLE IV
COVENANTS
iii
<PAGE>
PAGE
Section 4.1 Payment of Securities............................................45
Section 4.2 Maintenance of Office or Agency..................................45
Section 4.3 Limitation on Restricted Payments................................46
Section 4.4 Corporate Existence..............................................47
Section 4.5 Payment of Taxes and Other Claims................................47
Section 4.6 Compliance Certificate; Notice of Default........................47
Section 4.7 .................................................................48
Section 4.8 Waiver of Stay, Extension or Usury Laws..........................49
Section 4.9 Limitation on Transactions with Affiliates.......................49
Section 4.10 Limitation on Incurrence of Additional
Indebtedness and Disqualified Capital Stock.....................50
Section 4.11 Limitation on Dividends and Other Payment
Restrictions Affecting Subsidiaries.............................50
Section 4.12 Limitation on Liens Securing Indebtedness.......................51
Section 4.13 Limitation on Sale of Assets and Subsidiary
Stock...........................................................52
Section 4.14 Limitation on Layering Indebtedness.............................57
Section 4.15 Limitation on Lines of Business.................................57
Section 4.16 Limitation on Status as Investment Company......................57
Section 4.17 Future Subsidiary Guarantors....................................57
Section 4.18 Payment for Consent.............................................57
Section 4.19 Suspended Covenants.............................................58
Section 4.20 Payment of Additional Amounts...................................60
section 4.21 Calculation of Original Issue Discount..........................60
ARTICLE V
SUCCESSOR CORPORATION
Section 5.1 Limitation on Merger, Sale or Consolidation......................60
Section 5.2 Successor Corporation Substituted................................61
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
Section 6.1 Events of Default................................................62
Section 6.2 Acceleration of Maturity Date; Rescission and
Annulment......................................................64
Section 6.3 Collection of Indebtedness and Suits for
Enforcement by Trustee..........................................66
Section 6.4 Trustee May File Proofs of Claim.................................67
Section 6.5 Trustee May Enforce Claims without
Possession of Securities........................................68
iv
<PAGE>
PAGE
Section 6.6 Priorities.......................................................68
Section 6.7 Limitation on Suits..............................................69
Section 6.8 Unconditional Right of Holders to
Receive Principal, Premium and Interest.........................70
Section 6.9 Rights and Remedies Cumulative...................................70
Section 6.10 Delay or Omission Not Waiver....................................70
Section 6.11 Control by Holders..............................................70
Section 6.12 Waiver of Past Default..........................................71
Section 6.13 Undertaking for Costs...........................................71
Section 6.14 Restoration of Rights and Remedies..............................72
ARTICLE VII
TRUSTEE
Section 7.1 Duties of Trustee................................................72
Section 7.2 Rights of Trustee................................................74
Section 7.3 Individual Rights of Trustee.....................................75
Section 7.4 Trustee's Disclaimer.............................................75
Section 7.5 Notice of Defaults...............................................75
Section 7.6 Reports by Trustee to Holders....................................76
Section 7.7 Compensation and Indemnity.......................................76
Section 7.8 Replacement of Trustee...........................................77
Section 7.9 Successor Trustee by Merger, etc.................................79
Section 7.10 Eligibility; Disqualification...................................79
Section 7.11 Preferential Collection of Claims against
Issuers.........................................................79
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.1 Option to Effect Legal Defeasance or
Covenant Defeasance.............................................80
Section 8.2 Legal Defeasance and Discharge...................................80
Section 8.3 Covenant Defeasance..............................................81
Section 8.4 Conditions to Legal or Covenant Defeasance.......................81
Section 8.5 Deposited Cash and U.S. Government
Obligations to Be Held in Trust; Other Miscellaneous
Provisions.83
Section 8.6 Repayment to Issuers.............................................83
Section 8.7 Reinstatement84
ARTICLE IX
v
<PAGE>
PAGE
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1 Supplemental Indentures without Consent
of Holders......................................................85
Section 9.2 Amendments, Supplemental Indentures and
Waivers with Consent of Holders.................................86
Section 9.3 Compliance with TIA..............................................88
Section 9.4 Revocation and Effect of Consents................................88
Section 9.5 Notation on or Exchange of Securities............................89
Section 9.6 Trustee to Sign Amendments, etc..................................89
ARTICLE X
RIGHT TO REQUIRE REPURCHASE
Section 10.1 Repurchase of Securities at Option
of the Holder upon Change of Control............................90
ARTICLE XI
GUARANTEES
Section 11.1 Guarantees......................................................93
Section 11.2 Execution and Delivery of Guarantee.............................95
Section 11.3 Certain Bankruptcy Events.......................................95
Section 11.4 Limitation on Merger, Consolidation,
etc. of Guarantors.............................................95
Section 11.5 Future Guarantors...............................................96
ARTICLE XII
SUBORDINATION
Section 12.1 Securities Subordinated to Senior Debt..........................97
Section 12.2 No Payment on Securities in Certain
Circumstances..................................................97
Section 12.3 Securities Subordinated to Prior Payment of
All Senior Debt on Dissolution, Liquidation or Reorganization..99
Section 12.4 Securityholders to Be Subrogated to Rights
of Holders of Senior Debt......................................100
Section 12.5 Obligations of the Issuers Unconditional.......................100
Section 12.6 Trustee Entitled to Assume Payments Not
vi
<PAGE>
Prohibited in Absence of Notice................................101
Section 12.7 Application by Trustee of Assets Deposited
with It........................................................102
Section 12.8 Subordination Rights Not Impaired by Acts or
Omissions of the Issuers, Guarantors or
Holders of Senior Debt, etc.; Modifications....................102
Section 12.9 Securityholders Authorize Trustee to
Effectuate Subordination of Securities.........................103
Section 12.10 Right of Trustee to Hold Senior Debt..........................103
Section 12.11 Article XII Not to Prevent Events of Default..................104
Section 12.12 No Fiduciary Duty of Trustee to Holders
of Senior Debt.................................................104
ARTICLE XIII
MISCELLANEOUS
Section 13.1 TIA Controls...................................................104
Section 13.2 Notices........................................................105
Section 13.3 Communications by Holders with Other Holders...................105
Section 13.4 Certificate and Opinion as to Conditions
Precedent......................................................106
Section 13.5 Statements Required in Certificate or Opinion..................106
Section 13.6 Rules by Trustee, Paying Agent, Registrar......................107
Section 13.7 Legal Holidays.................................................107
Section 13.8 Governing Law..................................................107
Section 13.9 No Adverse Interpretation of Other Agreements..................108
Section 13.10 No Recourse Against Others....................................108
Section 13.11 Successors....................................................108
Section 13.12 Duplicate Originals...........................................108
Section 13.13 Severability..................................................108
Section 13.14 Table of Contents, Headings, etc..............................108
vii
<PAGE>
INDENTURE, dated as of [ ], among Sun International Hotels
Limited, an international business company organized under the laws of the
Commonwealth of The Bahamas ("Sun International"), Sun International North
America, Inc., a Delaware corporation and a wholly owned subsidiary of Sun
International ("SINA" and, together with Sun International, the "Issuers"), the
Guarantors whose names appear at the foot hereof and
[ ], a [ ], as Trustee.
The Issuers have duly authorized the execution and delivery of this
Indenture to provide for the issuance from time to time of their debentures,
notes, bonds or other evidences of indebtedness to be issued in one or more
series unlimited as to principal amount (herein called the "Securities"), as in
this Indenture provided.
The Guarantors have duly authorized the execution and delivery of this
Indenture to provide for the Guarantees of the Securities, if any, provided for
herein.
All things necessary to make this Indenture a valid agreement of the
Issuers and the Guarantors, in accordance with its terms, have been done.
NOW, THEREFORE, THIS INDENTURE WITNESSETH
That in order to declare the terms and conditions upon which the
Securities are authenticated, issued and delivered, and in consideration of the
premises, and of the purchase and acceptance of the Securities by the holders
thereof, the Issuers, the Guarantors and the Trustee covenant and agree with
each other, for the benefit of the respective Holders from time to time of the
Securities or any series thereof, as follows:
ARTICLE I
DEFINITIONS AND INCORPORATION BY REFERENCE
Section 1.1 DEFINITIONS.
"ACCELERATION NOTICE" shall have the meaning specified in Section 6.2.
"ACQUIRED INDEBTEDNESS" means Indebtedness or Disqualified Capital
Stock of any person existing at the time such person becomes a Subsidiary of
either of the Issuers or is merged or
<PAGE>
consolidated into or with either of the Issuers or any of their Subsidiaries.
"ACQUISITION" means the purchase or other acquisition of any person or
all or substantially all the assets of any person by any other person, or the
acquisition of assets that constitute all or substantially all of an operating
unit of business, whether by purchase, merger, consolidation, or other transfer,
and whether or not for consideration.
"ADDITIONAL AMOUNTS" shall have the meaning specified in Section 4.20.
"AFFILIATE" means any person directly or indirectly controlling or
controlled by or under direct or indirect common control with Sun International.
For purposes of this definition, the term "control" means the power to direct
the management and policies of a person, directly or through one or more
intermediaries, whether through the ownership of voting securities, by contract,
or otherwise, PROVIDED, THAT, with respect to ownership interest in Sun
International and its Subsidiaries a Beneficial Owner of 10% or more of the
total voting power normally entitled to vote in the election of directors,
managers or trustees, as applicable, shall for such purposes be deemed to
constitute control.
"AFFILIATE TRANSACTION" shall have the meaning specified in
Section 4.9.
"AGENT" means any Registrar, Paying Agent, co-Registrar or additional
Paying Agent.
"ASSET SALE" shall have the meaning specified in Section 4.13.
"ASSET SALE OFFER" shall have the meaning specified in Section 4.13.
"ASSET SALE OFFER AMOUNT" shall have the meaning specified in Section
4.13.
"ASSET SALE OFFER PRICE" shall have the meaning specified in Section
4.13.
"AVERAGE LIFE" means, as of the date of determination, with respect to
any security or instrument, the quotient obtained
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by dividing (i) the sum of the products of (a) the number of years from the date
of determination to the date or dates of each successive scheduled principal (or
redemption) payment of such security or instrument and (b) the amount of each
such respective principal (or redemption) payment by (ii) the sum of all such
principal (or redemption) payments.
"BANKRUPTCY LAW" means Title 11, U.S. Code or any similar Federal,
state or foreign law for the relief of debtors.
"BENEFICIAL OWNER" OR "BENEFICIAL OWNER" has the meaning attributed to
it in Rules 13d-3 and 13d-5 under the Exchange Act (as in effect on the Issue
Date of such series), whether or not applicable, except that a "person" shall be
deemed to have "beneficial ownership" of all shares that any such person has the
right to acquire, whether such right is exercisable immediately or only after
the passage of time.
"BOARD OF DIRECTORS" means, with respect to any person, the Board of
Directors of such person or any committee of the Board of Directors of such
person authorized, with respect to any particular matter, to exercise the power
of the Board of Directors of such person.
"BOARD RESOLUTION" means, with respect to any person, a duly adopted
resolution of the Board of Directors of such person.
"BUSINESS DAY" means each Monday, Tuesday, Wednesday, Thursday and
Friday which is not a day on which banking institutions in New York, New York or
the New York Stock Exchange are authorized or obligated by law or executive
order to close.
"CAPITAL STOCK" means, with respect to any corporation, any and all
shares, interests, rights to purchase (other than convertible or exchangeable
Indebtedness that is not otherwise itself capital stock), warrants, options,
participations or other equivalents of or interests (however designated) in
stock issued by that corporation.
"CAPITALIZED LEASE OBLIGATION" means, as applied to any person, any
lease of any property (whether real, personal or mixed) of which the discounted
present value of the rental obligations of such person, as lessee, in conformity
with GAAP, is required to be capitalized on the balance sheet of such person.
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"CASH" means 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 or
private debts.
"CASH EQUIVALENT" means (a) (i) securities issued or directly and
fully guaranteed or insured by the United States of America or any agency or
instrumentality thereof (PROVIDED that the full faith and credit of the United
States of America is pledged in support thereof), (ii) time deposits and
certificates of deposit of any domestic commercial bank of recognized standing
having capital and surplus in excess of $500 million or (iii) commercial paper
issued by others rated at least A-1 or the equivalent thereof by Standard &
Poor's Corporation or at least P-1 or the equivalent thereof by Moody's
Investors Service, Inc., and in the case of each of (i), (ii) and (iii) above
maturing within one year after the date of acquisition or (b) shares of money
market mutual funds or similar funds having assets in excess of $500 million.
"CHANGE OF CONTROL" means, with respect to a series of Securities,
(i) Sun International ceases to be the "beneficial owner," directly or
indirectly, of 100% of the Equity Interests of SINA; (ii) any sale, transfer or
other conveyance, whether direct or indirect, of all or substantially all of the
assets, on a consolidated basis, of Sun International or SINA, in one
transaction or a series of related transactions (in each case other than to a
person that is a Permitted Holder); (iii) any merger or consolidation of Sun
International with or into any person if, immediately after giving effect to
such transaction, any "person" or "group" (as such terms are used for purposes
of Sections 13(d) and 14(d) of the Exchange Act, whether or not applicable)
(other than a Permitted Holder) is or becomes the "beneficial owner," directly
or indirectly, of more than 50% of the total voting power in the aggregate
normally entitled to vote in the election of directors, managers, or trustees,
as applicable, of the surviving entity or entities; (iv) any "person" or "group"
(as such terms are used for purposes of Sections 13(d) and 14(d) of the Exchange
Act, whether or not applicable) (other than a Permitted Holder) is or becomes
the "beneficial owner," directly or indirectly, of more than 50% of the total
voting power in the aggregate of all classes of Capital Stock of Sun
International then outstanding normally entitled to vote in elections of
directors; (v) during any period of 12 consecutive months after the Issue Date
of such series, individuals who at the beginning of any such 12-month period
constituted the Board of Directors of Sun International or SINA (together with
any new directors whose election by such Board or whose nomination for
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election by the shareholders of Sun International or SINA, as applicable, 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 Sun International or SINA then in office;
or (vi) the adoption of a plan relating to the liquidation or dissolution of
either of the Issuers.
"CHANGE OF CONTROL OFFER" shall have the meaning specified in Section
10.1.
"CHANGE OF CONTROL PURCHASE DATE" shall have the meaning specified in
Section 10.1.
"CHANGE OF CONTROL PURCHASE PRICE" shall have the meaning specified in
Section 10.1.
"CHANGE OF CONTROL TRIGGERING EVENT" shall be deemed to have occurred
with respect to a series of Securities if either of the Rating Agencies shall
downgrade or withdraw their rating of the Securities of such series as a result
of, or, in any case, within 90 days of, a Change of Control.
"CONSOLIDATED COVERAGE RATIO" of any person on any date of
determination (a "Transaction Date") means the ratio, on a PRO FORMA basis, of
(a) the aggregate amount of Consolidated EBITDA of such person attributable to
continuing operations and businesses (exclusive of amounts attributable to
operations and businesses permanently discontinued or disposed of) for the
Reference Period to (b) the aggregate Consolidated Fixed Charges of such person
(exclusive of amounts attributable to operations and businesses permanently
discontinued or disposed of, but only to the extent that the obligations giving
rise to such Consolidated Fixed Charges would no longer be obligations
contributing to such person's Consolidated Fixed Charges subsequent to the
Transaction Date) during the Reference Period; PROVIDED, that for purposes of
such calculation, (i) Acquisitions which occurred during the Reference Period or
subsequent to the Reference Period and on or prior to the Transaction Date shall
be assumed to have occurred on the first day of the Reference Period, (ii)
transactions giving rise to the need to calculate the Consolidated Coverage
Ratio shall be assumed to have occurred on the first day of the Reference
Period, (iii) the incurrence of any Indebtedness or issuance of any Disqualified
Capital Stock during the Reference Period or subsequent to the Reference Period
and on or prior to the Transaction Date (and the application of the proceeds
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therefrom to the extent used to refinance or retire other Indebtedness) shall be
assumed to have occurred on the first day of such Reference Period, and (iv) the
Consolidated Fixed Charges of such person attributable to interest on any
Indebtedness or dividends on any Disqualified Capital Stock bearing a floating
interest (or dividend) rate shall be computed on a PRO FORMA basis as if the
rate in effect on the Transaction Date had been the applicable rate for the
entire period, unless such person or any of its Subsidiaries is a party to an
Interest Swap or Hedging Obligation (which shall remain in effect for the
12-month period immediately following the Transaction Date) that has the effect
of fixing the interest rate on the date of computation, in which case such rate
(whether higher or lower) shall be used.
"CONSOLIDATED EBITDA" means, with respect to any person, for any
period, the Consolidated Net Income of such person for such period adjusted to
add thereto (to the extent deducted from net revenues in determining
Consolidated Net Income), without duplication, the sum of (i) Consolidated
income tax expense, (ii) Consolidated depreciation and amortization expense,
provided that consolidated depreciation and amortization of a Subsidiary that is
a less than wholly owned Subsidiary shall only be added to the extent of the
equity interest of such person in such Subsidiary and (iii) Consolidated Fixed
Charges, less any non-Cash interest income.
"CONSOLIDATED FIXED CHARGES" of any person means, for any period, the
aggregate amount (without duplication and determined in each case in accordance
with GAAP) of (a) interest expensed or capitalized, paid, accrued, or scheduled
to be paid or accrued (including, in accordance with the following sentence,
interest attributable to Capitalized Lease Obligations) of such person and its
Consolidated Subsidiaries during such period, including (i) original issue
discount and non-Cash interest payments or accruals on any Indebtedness, (ii)
the interest portion of all deferred payment obligations and (iii) all
commissions, discounts and other fees and charges owed with respect to bankers'
acceptances and letters of credit financings and currency and Interest Swap and
Hedging Obligations, in each case to the extent attributable to such period, but
excluding interest payments on SINA's First Mortgage Non-Recourse Pass Through
Notes due June 30, 2000, and (b) the amount of dividends accrued or payable (or
guaranteed) by such person or any of its Consolidated Subsidiaries in respect of
preferred stock (other than by Subsidiaries of such person to such person or
such person's wholly owned Subsidiaries). For purposes of this definition, (x)
interest on a Capitalized Lease Obligation shall be deemed to accrue
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at an interest rate reasonably determined by Sun International to be the rate of
interest implicit in such Capitalized Lease Obligation in accordance with GAAP
and (y) interest expense attributable to any Indebtedness represented by the
guaranty by such person or a Subsidiary of such person of an obligation of
another person shall be deemed to be the interest expense attributable to the
Indebtedness guaranteed.
"CONSOLIDATED NET INCOME" means, with respect to any person for any
period, the net income (or loss) of such person and its Consolidated
Subsidiaries (determined on a consolidated basis in accordance with GAAP) for
such period, adjusted to exclude (only to the extent included in computing such
net income (or loss) and without duplication): (a) all gains (but not losses)
which are either extraordinary (as determined in accordance with GAAP), unusual
or nonrecurring (including any gain from the sale or other disposition of assets
or currency transactions outside the ordinary course of business or from the
issuance or sale of any capital stock), (b) the net income, if positive, of any
person, other than a Consolidated Subsidiary, in which such person or any of its
Consolidated Subsidiaries has an interest, except to the extent of the amount of
any dividends or distributions actually paid in Cash to such person or a wholly
owned Consolidated Subsidiary of such person during such period, but in any case
not in excess of such person's PRO RATA share of such person's net income for
such period, (c) the net income or loss of any person acquired in a pooling of
interests transaction for any period prior to the date of such acquisition, (d)
the net income, if positive, of any of such person's Consolidated Subsidiaries
to the extent that the declaration or payment of dividends or similar
distributions is not at the time permitted by operation of the terms of its
charter or bylaws or any other agreement, instrument, judgment, decree, order,
statute, rule or governmental regulation applicable to such Consolidated
Subsidiary, except for existing restrictions under the Credit Agreement and (e)
the net income attributable to the lease with respect to the 10 acres under the
Showboat Casino Hotel in Atlantic City, New Jersey.
"CONSOLIDATED NET WORTH" of any person at any date means the aggregate
consolidated stockholders' equity of such person (plus amounts of equity
attributable to preferred stock) and its Consolidated Subsidiaries, as would be
shown on the consolidated balance sheet of such person prepared in accordance
with GAAP, adjusted to exclude (to the extent included in calculating such
equity), the amount of any such stockholders' equity
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attributable to Disqualified Capital Stock or treasury stock of such person and
its Consolidated Subsidiaries.
"CONSOLIDATED SUBSIDIARY" means, for any person, each Subsidiary of
such person (whether now existing or hereafter created or acquired) the
financial statements of which are consolidated for financial statement reporting
purposes with the financial statements of such person in accordance with GAAP.
"CREDIT AGREEMENT" means the second amended and restated revolving
credit agreement dated as of August 12, 1997, by and among Sun International
Bahamas Limited, Sun International, certain of Sun International's subsidiaries,
certain financial institutions and The Bank of Nova Scotia, as administrative
and collateral agent, providing for an aggregate $375 million revolving credit
facility (excluding any amounts with respect to Interest Swap and Hedging
Obligations complying with the provisions set forth below) (which amount may be
increased to $500 million upon the later of the Paradise Island Expansion
Opening and December 31, 1998), including any related notes, guarantees,
collateral documents, instruments and agreements executed in connection
therewith, as such credit agreement and/or related documents may be amended,
restated, supplemented, renewed, replaced or otherwise modified from time to
time whether or not with the same agent, trustee, representative lenders or
holders, and, subject to the proviso to the next succeeding sentence,
irrespective of any changes in the terms and conditions thereof. Without
limiting the generality of the foregoing, the term "Credit Agreement" shall
include agreements in respect of Interest Swap and Hedging Obligations with
lenders party to the Credit Agreement or their affiliates entered into for bona
fide hedging purposes and not entered into for speculative purposes and shall
also include any amendment, amendment and restatement, renewal, extension,
restructuring, supplement or modification to any Credit Agreement and all
refundings, refinancings and replacements of any Credit Agreement, including any
agreement (i) extending or shortening the maturity of any Indebtedness incurred
thereunder or contemplated thereby, (ii) adding or deleting borrowers or
guarantors thereunder, so long as borrowers and issuers include one or more of
Sun International and its Subsidiaries and their respective successors and
assigns, (iii) increasing the amount of Indebtedness incurred thereunder or
available to be borrowed thereunder, PROVIDED that on the date such Indebtedness
is incurred it would not be prohibited by clause (a) of the definition of
"Permitted Indebtedness," or (iv) otherwise altering the terms and conditions
thereof in a manner not prohibited by the terms hereof.
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"CUSTODIAN" means any receiver, trustee, assignee, liquidator,
sequestrator or similar official under any Bankruptcy Law.
"DEBT INCURRENCE RATIO" shall have the meaning specified in Section
4.10.
"DEFAULT" means any event which is, or after notice or passage of time
or both would be, an Event of Default.
"DEFEASED SECURITIES" shall have the meaning specified in Section 8.2.
"DEFINITIVE SECURITIES" means any security in the form established
pursuant to Section 2.1 which is registered on the books of the Registrar.
"DEPOSITORY" means, with respect to a series of Securities issuable or
issued in whole or in part in global form, the person specified in Section 2.3
as the Depository with respect to such series of Securities, until a successor
shall have been appointed and become such pursuant to the applicable provision
of this Indenture, and, thereafter, "Depository" shall mean or include such
successor.
"DISQUALIFIED CAPITAL STOCK" means, with respect to a series of
Securities, (i) except as set forth in (ii), with respect to any person, Equity
Interests of such person that, by its terms or by the terms of any security into
which it is convertible, exercisable or exchangeable, is, or upon the happening
of an event or the passage of time would be, required to be redeemed or
repurchased (including at the option of the holder thereof) by such person or
any of its Subsidiaries, in whole or in part, on or prior to the Stated Maturity
of such series of Securities and (ii) with respect to any Subsidiary of such
person (other than the Guarantors, if any), any Equity Interests other than any
common equity with no preference, privileges, or redemption or repayment
provisions.
"EQUITY INTEREST" of any person means any shares, interests,
participations or other equivalents (however designated) in such person's
equity, and shall in any event include any Capital Stock issued by, or
partnership or membership interests in, such person.
"EVENT OF DEFAULT" shall have the meaning specified in Section 6.1.
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"EVENT OF LOSS" means, with respect to any property or asset, any (i)
loss, destruction or damage of such property or asset or (ii) any condemnation,
seizure or taking, by exercise of the power of eminent domain or otherwise, of
such property or asset, or confiscation or requisition of the use of such
property or asset.
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended,
and the rules and regulations promulgated by the SEC thereunder.
"EXEMPTED AFFILIATE TRANSACTION" means transactions solely between Sun
International and any of its wholly owned Subsidiaries or solely among wholly
owned Subsidiaries of Sun International.
"FF&E INDEBTEDNESS" means any Indebtedness of a person to any seller
or other person incurred to finance the acquisition (including in the case of a
Capitalized Lease Obligation, the lease) of any gaming facility or hotel or
gaming or hotel related fixtures, furniture or equipment which is directly
related to a Related Business of Sun International and which is incurred
concurrently with such acquisition and is secured only by the assets so
financed.
"GAAP" means, with respect to a series of Securities, United States
generally accepted accounting principles set forth in the opinions and
pronouncements of the Accounting Principles Board of the American Institute of
Certified Public Accountants and statements and pronouncements of the Financial
Accounting Standards Board or in such other statements by such other entity as
approved by a significant segment of the accounting profession in the United
States as in effect on the Issue Date.
"GAMING AUTHORITY" means any agency, authority, board, bureau,
commission, department, office or instrumentality of any nature whatsoever of
the United States or a foreign government, any state, province or any city or
other political subdivision or otherwise and whether now or hereafter in
existence, or any officer or official thereof, responsible for gaming licenses
held by Sun International or a Subsidiary of Sun International.
"GLOBAL SECURITY" means, with respect to any series of Securities
issued hereunder, a Security that is executed by the Issuers and authenticated
and delivered by the Trustee to the Depository or pursuant to the Depository's
instruction, all in accordance with this Indenture and any Indentures
supplemental
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hereto, or Board Resolution and set forth in an Officers' Certificate, which
shall be registered in the name of the Depository or its nominee and which shall
represent, and shall be denominated in an amount equal to the aggregate
principal amount of, all the outstanding Securities of such series or any
portion thereof, in either case having the same terms, including the same Issue
Date, Maturity Date and interest rate or method of determining interest.
"GUARANTEE" shall have the meaning provided in Section 11.1.
"GUARANTORS" means, with respect to a series of Securities, the
parties specified as such pursuant to Section 2.3.
"HOLDER" or "SECURITYHOLDER" means the person in whose name a Security
is registered on the Registrar's books.
"INCUR" shall have the meaning specified in Section 4.10.
"INCURRENCE DATE" shall have the meaning specified in Section 4.10.
"INDEBTEDNESS" of any person means, without duplication, (a) all
liabilities and obligations, contingent or otherwise, of such any person, (i) in
respect of borrowed money (whether or not the recourse of the lender is to the
whole of the assets of such person or only to a portion thereof), (ii) evidenced
by bonds, notes, debentures or similar instruments, (iii) representing the
balance deferred and unpaid of the purchase price of any property or services,
except those incurred in the ordinary course of its business that would
constitute ordinarily trade payables to trade creditors that are not more than
60 days past their original due date, (iv) evidenced by bankers' acceptances or
similar instruments issued or accepted by banks, (v) relating to any Capitalized
Lease Obligation, or (vi) evidenced by a letter of credit or a reimbursement
obligation of such person with respect to any letter of credit; (b) all net
obligations of such person under Interest Swap and Hedging Obligations; (c) all
liabilities and obligations of others of the kind described in the preceding
clause (a) or (b) that such person has guaranteed or that is otherwise its legal
liability or which are secured by any assets or property of such person and (d)
any and all deferrals, renewals, extensions, refinancing and refundings (whether
direct or indirect) of, or amendments, modifications or
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supplements to, any liability of the kind described in any of the preceding
clause (a), (b) or (c), or this clause (d), whether or not between or among the
same parties, and (e) all Disqualified Capital Stock of such person (measured at
the greater of its voluntary or involuntary maximum fixed repurchase price plus
accrued and unpaid dividends). For purposes hereof, the "maximum fixed
repurchase price" of any Disqualified Capital Stock which does not have a fixed
repurchase price shall be calculated in accordance with the terms of such
Disqualified Capital Stock as if such Disqualified Capital Stock were purchased
on any date on which Indebtedness shall be required to be determined pursuant to
the Indenture, and if such price is based upon, or measured by, the fair market
value of such Disqualified Capital Stock, such fair market value to be
determined in good faith by the board of directors of the issuer (or managing
general partner of the issuer) of such Disqualified Capital Stock.
"INDENTURE" means this Indenture, as amended or supplemented from time
to time in accordance with the terms hereof.
"INTEREST PAYMENT DATE" means, with respect to a series of Securities,
the stated due date of an installment of interest on such series of Securities.
"INTEREST SWAP AND HEDGING OBLIGATION" means any obligation of any
person pursuant to any interest rate swap agreement, interest rate cap
agreement, interest rate collar agreement, interest rate exchange agreement,
currency exchange agreement or any other agreement or arrangement designed to
protect against fluctuations in interest rates or currency values, including,
without limitation, any arrangement whereby,
directly or indirectly, such person is entitled to receive from time to time
periodic payments calculated by applying either a fixed or floating rate of
interest on a stated notional amount in exchange for periodic payments made by
such person calculated by applying a fixed or floating rate of interest on the
same notional amount.
"INVESTMENT" by any person in any other person means, with respect to
a series of Securities (without duplication), (a) the acquisition (whether by
purchase, merger, consolidation or otherwise) by such person (whether for Cash,
property, services, securities or otherwise) of capital stock, bonds, notes,
debentures, partnership or other ownership interests or other securities,
including any options or warrants, of such other person or any agreement to make
any such acquisition; (b) the making by such person of any deposit with, or
advance, loan
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or other extension of credit to, such other person (including the purchase of
property from another person subject to an understanding or agreement,
contingent or otherwise, to resell such property to such other person) or any
commitment to make any such advance, loan or extension (but excluding accounts
receivable or deposits arising in the ordinary course of business); (c) other
than guarantees of Indebtedness of Sun International or any Subsidiary to the
extent permitted by Section 4.10 (to the extent applicable to such series), the
entering into by such person of any guarantee of, or other credit support or
contingent obligation with respect to, Indebtedness or other liability of such
other person; (d) the making of any capital contribution by such person to such
other person; and (e) the designation by the Board of Directors of Sun
International of any person to be an Unrestricted Subsidiary. Sun International
shall be deemed to make an Investment in an amount equal to the fair market
value of the net assets of any subsidiary (or, if neither Sun International nor
any of its Subsidiaries has theretofore made an Investment in such subsidiary,
in an amount equal to the Investments being made), at the time that such
subsidiary is designated an Unrestricted Subsidiary, and any property
transferred to an Unrestricted Subsidiary from Sun International or a Subsidiary
shall be deemed an Investment valued at its fair market value at the time of
such transfer.
"INVESTMENT GRADE RATING" means a rating equal to or higher than Baa3
(or the equivalent) by Moody's (or any successor to the rating agency business
thereof) or BBB- (or the equivalent) by S&P (or any successor to the rating
agency business thereof).
"INVESTMENT GRADE STATUS" means, with respect to a series of
Securities, any time at which the ratings of the Securities of such series by
both Moody's (or any successor to the rating agency business thereof) and S&P
(or any successor to the rating agency business thereof) are Investment Grade
Ratings.
"ISSUE DATE" means, with respect to a series of Securities, the date
of first issuance of such series of Securities under the Indenture.
"ISSUER" means each party named as such in this Indenture until a
successor replaces it pursuant to the Indenture and thereafter means such
successor.
"JUNIOR SECURITY" means, with respect to a series of Securities, any
Qualified Capital Stock and any Indebtedness of
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an Issuer or a Guarantor, if any, as applicable, that (i) is subordinated in
right of payment to Senior Debt at least to the same extent as such series of
Securities or Guarantee, if any, as applicable, (ii) has no scheduled
installment of principal due, by redemption, sinking fund payment or otherwise,
on or prior to the Stated Maturity, (iii) does not have covenants or default
provisions materially more beneficial to the holders of such series of
Securities than those in effect with respect to such series of Securities on the
Issue Date and (iv) was authorized by an order or decree of a court of competent
jurisdiction that gave effect to (and states in such order or decree that effect
has been given to) the subordination of such securities to all Senior Debt of
the applicable Issuer or Guarantor, if any, not paid in full in Cash or Cash
Equivalents in connection with such reorganization; provided that all such
Senior Debt is assumed by the reorganized corporation and the rights of the
holders of any such Senior Debt are not, without the consent of such holders,
altered by such reorganization, which consent shall be deemed to have been given
if the holders of such Senior Debt, individually or as a class, shall have
approved such reorganization.
"LEGAL HOLIDAY" shall have the meaning provided in Section 13.7.
"LIEN" means any mortgage, charge, pledge, lien (statutory or
otherwise), privilege, security interest, hypothecation or other encumbrance
upon or with respect to any property of any kind, real or personal, movable or
immovable, now owned or hereafter acquired.
"MATURITY DATE" means, with respect to a series of Securities, the
date on which the principal of such series of Securities becomes due and payable
as therein or herein provided, whether at Stated Maturity, a Change of Control
Purchase Date, a purchase date with respect to an Asset Sale Offer or by
declaration of acceleration, call for redemption or otherwise.
"MOODY'S" means Moody's Investors Service, Inc.
"NET CASH PROCEEDS" means, with respect to a series of Securities, the
aggregate amount of Cash or Cash Equivalents received by Sun International in
the case of a sale of Qualified Capital Stock and by Sun International and its
Subsidiaries in respect of an Asset Sale plus, in the case of an issuance of
Qualified Capital Stock upon any exercise, exchange or conversion of securities
(including options, warrants, rights and convertible or exchangeable debt) of
Sun International that were
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issued for Cash on or after the Issue Date, the amount of Cash originally
received by Sun International upon the issuance of such securities (including
options, warrants, rights and convertible or exchangeable debt) less, in each
case, the sum of all payments, fees, commissions and reasonable and customary
expenses (including, without limitation, the fees and expenses of legal counsel
and investment banking fees and expenses) incurred in connection with such Asset
Sale or sale of Qualified Capital Stock, and, in the case of an Asset Sale only,
less the amount (estimated reasonably and in good faith by Sun International) of
income, franchise, sales and other applicable taxes required to be paid by Sun
International or any of its respective Subsidiaries in connection with such
Asset Sale.
"NON-RECOURSE INDEBTEDNESS" means Indebtedness of a person to the
extent that under the terms thereof or pursuant to applicable law (i) no
personal recourse shall be had against such person for the payment of the
principal of or interest or premium, if any, on such Indebtedness, and (ii)
enforcement of obligations on such Indebtedness is limited only to recourse
against interests in property purchased with the proceeds of the incurrence of
such Indebtedness and as to which none of the Issuers or any of its Subsidiaries
provides any credit support or is liable.
"NON-STRATEGIC REAL ESTATE" means (i) any real estate on Paradise
Island in the Bahamas, other than the real estate upon which the Atlantis Resort
& Casino property is located, and (ii) any real property in and around Atlantic
City, New Jersey, other than the Resorts Casino Hotel, the former site of the
Chalfonte Hotel and any other real estate contiguous to such sites.
"OFFICER" means, with respect to the Issuers or any Guarantor, the
Chairman of the Board, the Chief Executive Officer, the President, any Vice
President, the Chief Financial Officer, the Treasurer, the Controller, or the
Secretary or Assistant Secretary.
"OFFICERS' CERTIFICATE" means, with respect to the Issuers or any
Guarantor, a certificate signed by two Officers of both of the Issuers or such
Guarantor and otherwise complying with the requirements of Sections 13.4 and
13.5.
"OPINION OF COUNSEL" means a written opinion from legal counsel to the
Issuers complying with the requirements of Sec-
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tions 13.4 and 13.5. Unless otherwise required by this Indenture, the counsel
may be in-house counsel to the Issuers.
"ORIGINAL ISSUE DISCOUNT SECURITY" means any Security which provides
that an amount less than its principal amount is due and payable upon
acceleration after an Event of Default.
"PARADISE ISLAND EXPANSION OPENING" means the time when Sun
International's approximately $450 million expansion of its Atlantis Resort &
Casino property located on Paradise Island, The Bahamas shall have been
substantially completed and the new hotel and casino comprising the expansion
shall be ready for occupancy and operation.
"PAYING AGENT" shall have the meaning specified in Section 2.3.
"PERMITTED HOLDER" means Solomon Kerzner, his immediate family or a
trust or similar entity existing solely for his benefit or for the benefit of
his immediate family.
"PERMITTED INDEBTEDNESS" means, with respect to a series of Securities
and any accompanying Guarantees, Indebtedness incurred as follows:
(a) the Issuers and the Guarantors, if any, may incur (i)
Indebtedness pursuant to the Credit Agreement up to an aggregate principal
amount outstanding (including any Indebtedness issued to refinance, refund or
replace such Indebtedness) at any time of $375 million (excluding any amounts
with respect to Interest Swap and Hedging Obligations) (which amount may be
increased to $500 million upon the later to occur of the Paradise Island
Expansion Opening or December 31, 1998), minus the amount of any such
Indebtedness retired with Net Cash Proceeds from any Asset Sale or assumed by a
transferee in an Asset Sale (provided any commitment in respect of such
Indebtedness is permanently reduced) and (ii) Indebtedness with respect to
Interest Swap and Hedging Obligations entered into for bona fide hedging
purposes and not entered into for speculative purposes;
(b) the Issuers and the Guarantors, if any, may incur
Indebtedness evidenced by such series of Securities and such Guarantees, if any,
and represented by the Indenture up to the amounts specified therein as of the
date thereof;
(c) the Issuers and the Guarantors, if any, may incur FF&E
Indebtedness on or after the Issue Date, PROVIDED,
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that (i) such FF&E Indebtedness is Non-Recourse Indebtedness and (ii) such
Indebtedness shall not constitute more than 100% of the cost (determined in
accordance with GAAP) to the Issuers or the Guarantors, if any, as applicable,
of the property so purchased or leased;
(d) the Issuers and the Guarantors, if any, may incur
Indebtedness solely in respect of bankers acceptances and performance bonds (to
the extent that such incurrence does not result in the incurrence of any
obligation to repay any obligation relating to borrowed money of others), all in
the ordinary course of business in accordance with customary industry practices,
in amounts and for the purposes customary in their industry;
(e) the Issuers may incur Indebtedness to any wholly owned
Subsidiary, and any wholly owned Subsidiary may incur Indebtedness to any other
wholly owned Subsidiary or to an Issuer; PROVIDED, that, in the case of
Indebtedness of the Issuers (other than Indebtedness that is required to be
pledged to the lenders under the Credit Agreement), such obligations shall be
unsecured and subordinated in all respects to the Issuers' obligations pursuant
to Securities of such series, and the date of any event that causes a Subsidiary
to no longer be a wholly owned Subsidiary shall be an Incurrence Date; and
(f) the Issuers and their Subsidiaries, as applicable, may incur
Refinancing Indebtedness with respect to any Indebtedness or Disqualified
Capital Stock, as applicable, described in clauses (b) and (f) of this
definition or incurred under the Debt Incurrence Ratio contained in Section 4.10
(to the extent applicable to such series) or which is outstanding on the Issue
Date so long as such Refinancing Indebtedness is secured only by the assets that
secured the Indebtedness so refinanced or otherwise replaced.
"PERMITTED INVESTMENT" means, with respect to a series of Securities,
(a) any Investment in any such series of Securities; (b) any Investment in Cash
Equivalents; (c) any Investment in intercompany notes to the extent permitted
under clause (b) of the definition of "Permitted Indebtedness"; (d) any
Investment in a person in a Related Business who, after such Investment, becomes
a Subsidiary of an Issuer and a Guarantor of the Securities of such series (if
so required); and (e) any Investment in any property or assets to be used by an
Issuer or any Guarantor in a Related Business.
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"PERMITTED LIEN" means, with respect to a series of Securities, (a)
any Lien securing Securities of such series; (b) any Lien securing Indebtedness
of a person existing at the time such person becomes a Subsidiary or is merged
with or into either of the Issuers or a Subsidiary of either of the Issuers or
Liens securing Indebtedness incurred in connection with an Acquisition, PROVIDED
that such Liens were in existence prior to the date of such acquisition, merger
or consolidation, were not incurred in anticipation thereof, and do not extend
to any other assets; (c) any Lien in favor of either of the Issuers or any
Guarantor; and (d) any Lien arising from FF&E Indebtedness permitted to be
incurred under clause (c) of the definition of "Permitted Indebtedness",
provided such Lien relates solely to the property which is subject to such FF&E
Indebtedness.
"PERSON" means any individual, limited liability company, corporation,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or other agency or political
subdivision thereof.
"PRINCIPAL" of any Indebtedness (including the Securities) means the
principal of such Indebtedness plus any applicable premium, if any, on such
Indebtedness.
"PROPERTY" or "PROPERTY" means any right or interest in or to property
or assets of any kind whatsoever, whether real, personal or mixed and whether
tangible, intangible, contingent, indirect or direct.
"PUBLIC EQUITY OFFERING" means an underwritten public offering of
Common Stock of Sun International.
"QUALIFIED CAPITAL STOCK" means any Capital Stock of Sun International
that is not Disqualified Capital Stock.
"QUALIFIED EXCHANGE" means, with respect to a series of Securities,
any legal defeasance, redemption, retirement, repurchase or other acquisition of
Capital Stock or Indebtedness of Sun International issued on or after the Issue
Date with the Net Cash Proceeds received by Sun International from the
substantially concurrent sale of Qualified Capital Stock or any exchange of
Qualified Capital Stock for any Capital Stock or Indebtedness of Sun
International issued on or after the Issue Date.
"RATING AGENCIES" means S&P and Moody's or any successor to the
respective rating agency businesses thereof.
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"RECORD DATE" means, with respect to a series of Securities, a Record
Date specified in such series of Securities whether or not such Record Date is a
Business Day.
"REDEMPTION DATE," when used with respect to any series of Securities
to be redeemed, means the date fixed for such redemption pursuant to Article III
of this Indenture and the Securities of such series.
"REDEMPTION PRICE," when used with respect to any series of Securities
to be redeemed, means the redemption price for such redemption set forth in the
Securities of such series, which shall include in each case accrued and unpaid
interest with respect to such Securities to the applicable Redemption Date.
"REFERENCE PERIOD" with regard to any person means, with respect to a
series of Securities, the four full fiscal quarters (or such lesser period
during which such person has been in existence) ended immediately preceding any
date upon which any determination is to be made pursuant to the terms of the
Securities of such series or the Indenture.
"REFINANCING INDEBTEDNESS" means, with respect to a series of
Securities, Indebtedness or Disqualified Capital Stock (a) issued in exchange
for, or the proceeds from the issuance and sale of which are used substantially
concurrently to repay, redeem, defease, refund, refinance, discharge or
otherwise retire for value, in whole or in part, or (b) constituting an
amendment, modification or supplement to, or a deferral or renewal of ((a) and
(b) above are, collectively, a "Refinancing"), any Indebtedness or Disqualified
Capital Stock in a principal amount or, in the case of Disqualified Capital
Stock, liquidation preference, not to exceed (after deduction of reasonable and
customary fees and expenses incurred in connection with the Refinancing) the
lesser of (i) the principal amount or, in the case of Disqualified Capital
Stock, liquidation preference, of the Indebtedness or Disqualified Capital Stock
so Refinanced and (ii) if such Indebtedness being Refinanced was issued with an
original issue discount, the accreted value thereof (as determined in accordance
with GAAP) at the time of such Refinancing; PROVIDED, that (A) such Refinancing
Indebtedness of any Subsidiary of Sun International shall only be used to
Refinance outstanding Indebtedness or Disqualified Capital Stock of such
Subsidiary, (B) such Refinancing Indebtedness shall (x) not have an Average Life
shorter than the Indebtedness or Disqualified Capital Stock to be so refinanced
at the time of such Refinancing and (y) in all respects, be no less subordinated
or junior, if
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applicable, to the rights of Holders of such series of Securities than was the
Indebtedness or Disqualified Capital Stock to be refinanced and (C) such
Refinancing Indebtedness shall have a final stated maturity or redemption date,
as applicable, no earlier than the final stated maturity or redemption date, as
applicable, of the Indebtedness or Disqualified Capital Stock to be so
refinanced.
"REGISTRAR" shall have the meaning specified in Section 2.3.
"RELATED BUSINESS" means the gaming or hotel business and other
businesses necessary for, or in the good faith judgment of the Board of
Directors of Sun International, incident to, connected with, arising out of, or
developed or operated to permit or facilitate the conduct or pursuit of the
gaming or hotel business (including developing or operating sports or
entertainment facilities, retail facilities, restaurants, night clubs,
transportation and communications services or other related activities or
enterprises and any additions or improvements thereto) and potential
opportunities in the gaming or hotel business.
"REPRESENTATIVE" means The Bank of Nova Scotia or any successor or
successors under the Credit Agreement.
"REQUIRED REGULATORY REDEMPTION" shall have the meaning specified in
Section 3.2.
"RESTRICTED PAYMENT" means, with respect to any person, (a) the
declaration or payment of any dividend or other distribution in respect of
Equity Interests of such person or any parent or Subsidiary of such person, (b)
any payment on account of the purchase, redemption or other acquisition or
retirement for value of Equity Interests of such person or any Subsidiary or
parent of such person, (c) other than with the proceeds from the substantially
concurrent sale of, or in exchange for, Refinancing Indebtedness, any purchase,
redemption, or other acquisition or retirement for value of, any payment in
respect of any amendment of the terms of or any defeasance of, any Subordinated
Indebtedness, directly or indirectly, by such person or a parent or Subsidiary
of such person prior to the scheduled maturity, any scheduled repayment of
principal, or scheduled sinking fund payment, as the case may be, of such
Indebtedness and (d) any Investment by such person, other than a Permitted
Investment; PROVIDED, HOWEVER, that the term "Restricted Payment" does not
include (i) any dividend, distribution or other payment on or
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with respect to Equity Interests of an Issuer to the extent payable solely in
shares of Qualified Capital Stock of such Issuer; or (ii) any dividend,
distribution or other payment to the Issuers, or to any Guarantors, by Sun
International or any of its Subsidiaries.
"S&P" means Standard & Poor's Ratings Group, a division of the
McGraw-Hill Companies, Inc.
"SEC" means the Securities and Exchange Commission.
"SECURITY OR SECURITIES" has the meaning stated in the first recital
of this Indenture and more particularly means any debt security or debt
securities, as the case may be, of any series authenticated and delivered under
this Indenture.
"SECURITIES ACT" means the Securities Act of 1933, as amended, and the
rules and regulations of the SEC promulgated thereunder.
"SECURITIES CUSTODIAN" means, with respect to a series of Securities,
the Trustee, as custodian with respect to the Securities of such series in
global form, or any successor entity thereto.
"SECURITYHOLDER" See "HOLDER."
"SENIOR DEBT" of Sun International, SINA or any Guarantor means, with
respect to a series of Securities, Indebtedness (including and together with all
monetary obligations in respect of the Credit Agreement, and interest, whether
or not allowable, accruing on Indebtedness incurred pursuant to the Credit
Agreement after the filing of a petition initiating any proceeding under any
bankruptcy, insolvency or similar law or which would have accrued but for such
filing) of Sun International, SINA or such Guarantor, if any, arising under the
Credit Agreement or that, by the terms of the instrument creating or evidencing
such Indebtedness, is expressly designated Senior Debt and made senior in right
of payment to such series of Securities or the applicable Guarantee, if any;
provided, that in no event shall Senior Debt include (a) Indebtedness to any
Subsidiary of Sun International or any officer, director or employee of Sun
International or any Subsidiary of Sun International (other than Indebtedness
that is required to be pledged to the lenders under the Credit Agreement), (b)
Indebtedness incurred in violation of the terms of the Indenture or the
Securities of such series, (c) Indebtedness to trade creditors, (d) Disqualified
Capital
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Stock, and (e) any liability for taxes owed or owing by Sun International, SINA
or such Guarantor, if any.
"SIGNIFICANT SUBSIDIARY" shall, with respect to a series of
Securities, have the meaning provided under Regulation S-X under the Securities
Act, as in effect on the Issue Date.
"STATED MATURITY" means, with respect to a series of Securities, the
date specified in the Securities of such series as the fixed date on which the
payment of principal of the Securities of such series is due and payable,
including pursuant to any mandatory redemption provision (but excluding any
provision providing for the repurchase of the Securities of such series at the
option of the holder thereof upon the happening of any contingency beyond the
control of the Issuers unless such contingency has occurred).
"SUBORDINATED DEBT SECURITIES" shall have the meaning assigned to it
in the first paragraph of Article XII.
"SUBORDINATED INDEBTEDNESS" means, with respect to a series of
Securities or any Guarantee, Indebtedness of Sun International, SINA or such
Guarantor, if any, that is subordinated in right of payment to such series of
Securities or such Guarantee, if any, as applicable, in any respect or, for
purposes of the definition of Restricted Payments only, has a stated maturity on
(except for such series of Securities) or after the Stated Maturity.
"SUBSIDIARY," with respect to any person, means (i) a corporation a
majority of whose Equity Interests with voting power, under ordinary
circumstances, to elect directors is at the time, directly or indirectly, owned
by such person, by such person and one or more Subsidiaries of such person or by
one or more Subsidiaries of such person, (ii) any other person (other than a
corporation) in which such person, one or more Subsidiaries of such person, or
such person and one or more Subsidiaries of such person, directly or indirectly,
at the date of determination thereof has at least majority ownership interest,
or (iii) a partnership in which such person or a Subsidiary of such person is,
at the time, a general partner. Notwithstanding the foregoing, an Unrestricted
Subsidiary shall not be a Subsidiary of Sun International or any Subsidiary of
Sun International. Unless the context requires otherwise, Subsidiary means
each direct and indirect Subsidiary of Sun International.
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"TIA" means the Trust Indenture Act of 1939 (15 U.S. Code Sections
77aaa-77bbbb) as in effect on the date of the execution of this Indenture,
except as permitted in Section 9.3.
"TRUSTEE" means the party named as such in the recitals or appointed
as such from time to time pursuant to Section 7.8 and, subject to the provisions
of Article VII, includes its or their successors and assigns. If at any time
there is more than one such person, "Trustee" as used with respect to the
Securities of any series shall mean the Trustee with respect to the Securities
of that series.
"TRUST OFFICER" means any officer within the corporate trust
department (or any successor group) of the Trustee including any vice president,
assistant vice president, assistant secretary or any other officer or assistant
officer of the Trustee customarily performing functions similar to those
performed by the persons who at that time shall be such officers, and also
means, with respect to a particular corporate trust matter, any other officer of
the corporate trust department (or any successor group) of the Trustee to whom
such trust matter is referred because of his knowledge of and familiarity with
the particular subject.
"UNRESTRICTED SUBSIDIARY" means, with respect to a series of
Securities, any subsidiary of Sun International (other than SINA) that does not
own any Capital Stock of, or own or hold any Lien on any property of, Sun
International or any other Subsidiary of Sun International or SINA and that
shall be designated an Unrestricted Subsidiary by the Board of Directors of Sun
International; PROVIDED, that (i) such subsidiary shall not engage, to any
substantial extent, in any line or lines of business activity other than a
Related Business, (ii) neither immediately prior thereto nor after giving pro
forma effect to such designation would there exist a Default or Event of Default
and (iii) immediately after giving pro forma effect thereto, Sun International
could incur at least $1.00 of Indebtedness pursuant to the Debt Incurrence Ratio
in Section 4.10 (to the extent applicable to such series of Securities). The
Board of Directors of Sun International may designate any Unrestricted
Subsidiary to be a Subsidiary, provided, that (i) no Default or Event of Default
is existing or will occur as a consequence thereof and (ii) immediately after
giving effect to such designation, on a pro forma basis, Sun International could
incur at least $1.00 of Indebtedness pursuant to the Debt Incurrence Ratio in
Section 4.10 (to the extent applicable to such series of Securities). Each such
designation shall be evidenced by filing with the
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Trustee a certified copy of the resolution giving effect to such designation and
an Officers' Certificate certifying that such designation complied with the
foregoing conditions.
"U.S. GOVERNMENT OBLIGATIONS" means direct non-callable obligations
of, or noncallable obligations guaranteed by, the United States of America for
the payment of which obligation or guarantee the full faith and credit of the
United States of America is pledged.
"WHOLLY OWNED SUBSIDIARY" means a Subsidiary all the Equity Interests
of which are owned by Sun International or one or more wholly owned Subsidiaries
of Sun International, except for directors' qualifying shares.
Section 1.2 INCORPORATION BY REFERENCE OF TIA.
Whenever this Indenture refers to a provision of the TIA, such
provision is incorporated by reference in and made a part of this Indenture.
The following TIA terms used in this Indenture have the following meanings:
"COMMISSION" means the SEC.
"INDENTURE SECURITIES" means the Securities.
"INDENTURE SECURITYHOLDER" means a Holder or a Securityholder.
"INDENTURE TO BE QUALIFIED" means this Indenture.
"INDENTURE TRUSTEE" or "INSTITUTIONAL TRUSTEE" means the Trustee.
"OBLIGOR" on the indenture securities means the Issuers and any other
obligor on the Securities.
All other TIA terms used in this Indenture that are defined by the
TIA, defined by TIA reference to another statute or defined by SEC rule and not
otherwise defined herein have the meanings assigned to them thereby.
Section 1.3 RULES OF CONSTRUCTION.
Unless the context otherwise requires:
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(i) a term has the meaning assigned to it;
(ii) an accounting term not otherwise defined has the meaning
assigned to it in accordance with GAAP;
(iii) "or" is not exclusive;
(iv) words in the singular include the plural, and words in the
plural include the singular;
(v) provisions apply to successive events and transactions;
(vi) "herein," "hereof" and other words of similar import refer
to this Indenture as a whole and not to any particular Article, Section or
other subdivision; and
(vii) references to Sections or Articles means reference to such
Section or Article in this Indenture, unless stated otherwise.
ARTICLE II
THE SECURITIES
Section 2.1 FORM AND DATING.
The Securities of each series and the Trustee's certificate or
certificates of authentication, in respect thereof, shall be in such form
(including, in the case of the Securities, global form) as shall be established
by or pursuant to a Board Resolution of each of the Issuers or in one or more
indentures supplemental hereto in each case with such appropriate provisions as
are required or permitted by this Indenture. The Securities may have
identifications, notations, legends or endorsements as required by law, stock
exchange rule or usage. The Issuers shall approve the form of the Securities
and any notation, legend or endorsement on them. If the form of any series of
Securities is established by action taken pursuant to a Board Resolution, a copy
of an appropriate record of such action shall be certified by an Officer of the
Issuers and delivered to the Trustee at or prior to the delivery of a written
order of the Issuers in the form of an Officers' Certificate for the
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authentication and delivery of such series of Securities. Each Security shall
be dated the date of its authentication.
The terms and provisions contained in the Securities of each series
shall constitute, and are hereby expressly made, a part of this Indenture and,
to the extent applicable, the Issuers and the Trustee, by their execution and
delivery of this Indenture, expressly agree to such terms and provisions and to
be bound thereby.
Section 2.2 EXECUTION AND AUTHENTICATION; DENOMINATIONS.
Two Officers shall sign, or one Officer shall sign and one Officer
shall attest to, the Securities for the Issuers by manual or facsimile
signature.
If an Officer whose signature is on a Security was an Officer at the
time of such execution but no longer holds that office at the time the Trustee
authenticates the Security, the Security shall be valid nevertheless and the
Issuers shall nevertheless be bound by the terms of such Securities and this
Indenture.
A Security shall not be valid until an authorized signatory of the
Trustee manually signs the certificate of authentication on the Security, but
such signature shall be conclusive evidence that the Security has been
authenticated pursuant to the terms of this Indenture.
The Trustee shall authenticate a series of Securities upon a written
order of the Issuers in the form of an Officers' Certificate with respect to
such series. The Trustee's certificate of authentication shall be in
substantially the following form:
This is one of the Securities of the series designated
herein and referred to in the within-mentioned Indenture.
--------------------------
As Trustee
By:
-----------------------
Authorized Signatory
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The Officers' Certificate shall specify the amount of Securities to be
authenticated and the date on which the Securities are to be authenticated. The
aggregate principal amount of Securities that may be authenticated and delivered
under this Indenture is unlimited. Upon the written order of the Issuers in the
form of an Officers' Certificate, the Trustee shall authenticate Securities in
substitution of Securities originally issued to reflect any name change of
either of the Issuers.
In authenticating such Securities, and accepting the additional
responsibilities under this Indenture in relation to such Securities, the
Trustee shall be entitled to receive, and, subject to Section 7.1, shall be
fully protected in relying upon:
(a) A copy of the Board Resolution or Board Resolutions in or
pursuant to which the terms and form of the Securities were established,
certified by the Issuers to have been duly adopted by the Board of
Directors of each Issuer and to be in full force and effect as of the date
of such certificate, and if the terms and form of such Securities are
established by an Officers' Certificate pursuant to general authorization
of the Board of Directors of each Issuer, such Officers' Certificate;
(b) an executed supplemental indenture, if any;
(c) an Officers' Certificate delivered in accordance with Section
13.5; and
(d) an Opinion Counsel which shall state:
(1) that the form of such Securities has been established by a
supplemental indenture or by or pursuant to a resolution of the
Board of Directors of each Issuer in accordance with Section 2.1
and in conformity with the provisions of this Indenture;
(2) that the terms of such Securities have been established in
accordance with Section 2.3 and in conformity with the other
provisions of this Indenture;
(3) that such Securities, when authenticated and delivered by
the Trustee and issued by the Issuers in the manner and subject
to any conditions specified in such Opinion of Counsel, will
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constitute valid and legally binding obligations of the Company,
enforceable in accordance with their terms, subject to
bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting the enforcement of
creditors' rights and to general equity principles; and
(4) that all laws and requirements in respect of the execution
and delivery by the Issuers of such Securities have been complied
with.
The Trustee shall have the right to decline to authenticate and
deliver any Securities under this Section if the Trustee, being advised by
counsel, determines that such action may not lawfully be taken or if the Trustee
in good faith shall determine that such action would expose the Trustee to
personal liability to existing Holders.
The Trustee may appoint an authenticating agent acceptable to the
Issuers to authenticate Securities. Unless otherwise provided in the
appointment, an authenticating agent may authenticate Securities whenever the
Trustee may do so. Each reference in this Indenture to authentication by the
Trustee includes authentication by such agent. An authenticating agent has the
same rights as an Agent to deal with the Issuers, any Affiliate of the Issuers
or any of their respective Subsidiaries.
Unless provided otherwise in connection with the establishment of a
series of Securities pursuant to Section 2.3, Securities of such series shall be
issuable only in registered form without coupons in denominations of $1,000 and
any integral multiple thereof.
Section 2.3 SECURITIES ISSUABLE IN SERIES; REGISTRAR AND PAYING
AGENT.
The aggregate principal amount of Securities which may be
authenticated and delivered under this Indenture is unlimited.
The Securities may be issued in one or more series. There shall be
established in or pursuant to a Board Resolution of each of the Issuers and set
forth in an Officers' Certificate of each of the Issuers, or established in one
or more indentures supplemental hereto, prior to the issuance of any series of
Securities:
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(1) the title of the Securities of the series (which shall distinguish
the Securities of the series from Securities of any other series);
(2) any limit upon the aggregate principal amount of the Securities of
the series which may be authenticated and delivered under this Indenture (except
for Securities authenticated and delivered upon registration of transfer of, or
in exchange for, or in lieu of, other Securities of the series pursuant to
Sections 2.6, 2.7, 2.10 and 9.5 and except for any Securities which, pursuant to
Section 2.2 are deemed never to have been authenticated and delivered
hereunder);
(3) the person to whom any interest on a Security of the series shall
be payable, if other than the person in whose name that Security is registered
at the close of business on the record date for such interest;
(4) the date or dates on which the principal of any Securities of the
series is payable or the method of determination thereof;
(5) the rate or rates (which may be fixed or variable) at which any
Securities of the series shall bear interest, if any, the date or dates from
which any such interest shall accrue, the dates on which any such interest shall
be payable and the record date for any such interest payable on any such payment
date;
(6) any terms applicable to original issue discount, if any (as that
term is defined in the Internal Revenue Code of 1986, as amended, and the
regulations thereunder), including the rate or rates at which such original
issue discount, if any, shall accrue;
(7) the place or places where the principal of and interest on any
Securities of the series shall be payable;
(8) the period or periods within which, the price or prices at which
and the terms and conditions upon which any Securities of the series may be
redeemed, in whole or in part, at the option of the Issuers and, if other than
by a Board Resolution of the Issuers, the manner in which any election by the
Issuers to redeem the Securities shall be evidenced;
(9) the obligation, if any, of the Issuers to redeem or purchase any
Securities of the series pursuant to any sinking
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fund or analogous provisions or at the option of the Holder thereof and the
period or periods within which, the price or prices at which and the terms and
conditions upon which any Securities of the series shall be redeemed or
purchased, in whole or in part, pursuant to such obligation;
(10) the terms and conditions, if any, upon which the Securities of
the series may or must be converted into other securities of the Issuers or
exchanged for the other securities of the Issuers or another enterprise;
(11) if other than denomination of $1,000 and any integral multiple
thereof, the denominations in which any Securities of the series shall be
issuable;
(12) if the amount of principal of or interest on any Securities of
the series is to be determined with reference to an index, pursuant to a formula
or by another method, the manner in which such amounts shall be determined and
the calculation agent, if any, with respect thereto;
(13) if other than the entire principal amount thereof, the portion of
the principal amount of any Securities of the series which shall be payable upon
declaration of acceleration of the maturity thereof pursuant to Section 6.2;
(14) if the principal amount payable at the maturity of any Securities
of the series will not be determinable as of any one or more dates prior to
maturity, the amount which shall be deemed to be the principal amount of such
Securities as of any such date for any purpose thereunder or hereunder,
including the principal amount thereof which shall be due and payable upon any
maturity date other than the Stated Maturity or which shall be deemed to be
outstanding as of any date prior to the Stated Maturity (or, in any such case,
the manner in which such amount deemed to be the principal amount shall be
determined);
(15) if applicable, that the Securities of the series, in whole or any
specified part, shall be defeasible pursuant to Article VIII, and, if other than
by a Board Resolution of the Issuers, the manner in which any election by the
Issuers to defease such Securities shall be evidenced;
(16) any addition to or change in the Events of Default which applies
to any Securities of the series and any change in the right of the Trustee or
the requisite Holders of such
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Securities to declare the principal amount thereof due and payable pursuant to
Section 6.2;
(17) if applicable, any provisions for securing all or any portion of
the Indebtedness evidenced by the Securities of the series;
(18) if applicable, any provisions relating to the seniority or
subordination of all or any portion of the Indebtedness evidenced by the
Securities of the series to other Indebtedness of the Issuers including, as
applicable, other Indebtedness evidenced by Securities;
(19) any addition to or change in the covenants set forth in Article
IV which applies to Securities of the series;
(20) whether the Securities of the series are guaranteed and, if so,
the identity of the Guarantors and the terms of such Guarantees (including
whether and the extent to which the Guarantees are subordinated to the other
indebtedness of the Guarantors);
(21) whether the Securities of the series shall be issued in whole or
in part in temporary or permanent form of a Global Security or Securities and,
if so, the initial Depository with respect to any such temporary or permanent
Global Security or Securities, and if other than as provided in Section 2.6,
whether and the circumstances under which beneficial owners of interests in any
such temporary or permanent Global Security or Securities may exchange such
interests for Securities of such series and of like tenor of any authorized form
and denomination; and
(22) any other material terms of the Securities of such series (which
terms shall not be inconsistent with the provisions of this Indenture, but which
may modify or delete any provision of this Indenture with respect to such
series, provided that no such term may modify or delete any provision hereof if
imposed by the TIA, and provided further that any modification or deletion of
the rights, duties or immunities of the Trustee hereunder shall have been
consented to in writing by the Trustee).
If any of the foregoing terms are not available at the time such Board
Resolutions are adopted, or such Officers' Certificates or any supplemental
indenture is executed, such resolutions, Officers' Certificates or supplemental
indenture may
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reference the document or documents to be created in which such terms will be
set forth prior to the issuance of such Securities.
For each series of Securities, the Issuers shall maintain an office or
agency in the Borough of Manhattan, the City of New York, where such series of
Securities may be presented for registration of transfer or for exchange
("Registrar") and an office or agency in the Borough of Manhattan, the City of
New York where Securities may be presented for payment ("Paying Agent") and an
office or agency where notices and demands to or upon the Issuers in respect of
each series of the Securities may be served. For each series of Securities, the
Issuers may act as Registrar or Paying Agent for such series, except that, for
the purposes of Articles III, VIII, X and Section 4.13 (to the extent applicable
to such series of Securities) neither Issuer nor any Affiliate thereof shall act
as Paying Agent for such series. The Registrar for each series of Securities
shall keep a register of the Securities and of their transfer and exchange. The
Issuers may have one or more co-Registrars and one or more additional Paying
Agents for each series of Securities. The term "Paying Agent" includes any
additional Paying Agent. The term "Registrar" includes any co-Registrar. The
Issuers may change any Paying Agent or Registrar upon 30 days' written notice to
the Trustee. The Issuers hereby initially appoint the Trustee as Registrar and
Paying Agent for each series of Securities, and the Trustee hereby initially
agrees so to act.
The Issuers shall enter into an appropriate written agency agreement
with any Agent not a party to this Indenture, which agreement shall implement
the provisions of this Indenture that relate to such Agent. The Issuers shall
promptly notify the Trustee in writing of the name and address of any such
Agent. If the Issuers fail to maintain a Registrar or Paying Agent for each
series of Securities, the Trustee shall act as such.
The Issuers initially appoint The Depository Trust Company ("DTC") to
act as Depository with respect to the Global Securities of each series.
The Issuers initially appoint the Trustee to act as Securities
Custodian with respect to the Global Securities of each series.
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Section 2.4 PAYING AGENT TO HOLD ASSETS IN TRUST.
With respect to a series of Securities, the Issuers shall require each
Paying Agent other than the Trustee to agree in writing that each Paying Agent
shall hold in trust for the benefit of Holders or the Trustee all assets held by
the Paying Agent for the payment of principal of or interest on such series of
Securities (whether such assets have been distributed to it by the Issuers or
any other obligor on such series of Securities), and shall notify the Trustee in
writing of any Default by the Issuers (or any other obligor on such series of
Securities) in making any such payment. If either Issuer or any Subsidiary
thereof acts as Paying Agent for any series of Securities, it shall segregate
such assets and hold them as a separate trust fund for the benefit of the
Holders or the Trustee for such series of Securities. The Issuers at any time
may require a Paying Agent to distribute all assets held by it to the Trustee
and account for any assets disbursed and the Trustee may at any time during the
continuance of any payment Default, upon written request to a Paying Agent,
require such Paying Agent to distribute all assets held by it to the Trustee and
to account for any assets distributed. Upon distribution to the Trustee of all
assets that shall have been delivered by the Issuers to a Paying Agent, such
Paying Agent (if other than either of the Issuers) shall have no further
liability for such assets.
Section 2.5 SECURITYHOLDER LISTS.
The Trustee shall, for each series of Securities, preserve in as
current a form as is reasonably practicable the most recent list available to it
of the names and addresses of the Holders of such series. For each series of
Securities, if the Trustee is not the Registrar, the Issuers shall furnish to
the Trustee on or before the third Business Day preceding each Interest Payment
Date and at such other times as the Trustee may request in writing, but in any
event at least semi-annually, a list in such form and as of such date as the
Trustee reasonably may require of the names and addresses of Holders of such
series. The Trustee, the Registrar and the Issuers shall, for each series of
Securities, provide a current securityholder list to any Gaming Authority upon
demand.
Section 2.6 TRANSFER AND EXCHANGE.
(a) When Definitive Securities of any series are presented to
the Registrar or a co-Registrar of such series with a request
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(x) to register the transfer of such Definitive Securities or
(y) to exchange such Definitive Securities for an equal principal
amount of Definitive Securities of other authorized denominations,
such Registrar or co-Registrar shall register the transfer or make the exchange
as requested if its reasonable requirements for such transaction are met;
PROVIDED, HOWEVER, that the Definitive Securities surrendered for transfer or
exchange shall be duly endorsed or accompanied by a written instrument of
transfer in form reasonably satisfactory to such Registrar or co-Registrar, duly
executed by the Holder thereof or his attorney duly authorized in writing.
(b) RESTRICTIONS ON TRANSFER OF A DEFINITIVE SECURITY FOR A
BENEFICIAL INTEREST IN A GLOBAL SECURITY. A Definitive Security of any series
may not be exchanged for a beneficial interest in a Global Security of such
series except upon satisfaction of the requirements set forth below. Upon
receipt by the Registrar for any series of a Definitive Security of such series,
duly endorsed or accompanied by appropriate instruments of transfer, in form
satisfactory to such Registrar, together with written instructions directing
such Registrar to make, or to direct the Securities Custodian for such series to
make, an endorsement on the Global Security of such series to reflect an
increase in the aggregate principal amount of the Securities represented by such
Global Security of such series, then such Registrar shall cancel such Definitive
Security and cause, or direct such Securities Custodian to cause, in accordance
with the standing instructions and procedures existing between the Depository
for such series and such Securities Custodian, the aggregate principal amount of
Securities of such series represented by the Global Security of such series to
be increased accordingly. If no Global Securities of such series are then
outstanding, the Issuers shall issue and the Trustee shall authenticate a new
Global Security of such series in the appropriate principal amount.
(c) TRANSFER AND EXCHANGE OF GLOBAL SECURITIES. The transfer
and exchange of Global Securities of any series or beneficial interests therein
shall be effected through the Depository for such series, in accordance with
this Indenture and the procedures of such Depository.
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(d) TRANSFER OF A BENEFICIAL INTEREST IN A GLOBAL SECURITY FOR A
DEFINITIVE SECURITY.
(i) Any person having a beneficial interest in a Global
Security of any series may upon request exchange such beneficial interest
for a Definitive Security of such series. Upon receipt by the Trustee of
written instructions or such other form of instructions as is customary for
the Depository for such series from such Depository or its nominee on
behalf of any person having a beneficial interest in a Global Security and
upon receipt by the Trustee of a written order or such other form of
instructions as is customary for such Depository from a participant or
indirect participant in such Depository to issue a Definitive Security (all
of which may be submitted by facsimile), then the Registrar or the
Securities Custodian for such series, at the direction of the Trustee, will
cause, in accordance with the standing instructions and procedures existing
between such Depository and such Securities Custodian, the aggregate
principal amount of the Global Security of such series to be reduced and,
following such reduction, the Issuers will execute and the Trustee will
authenticate and deliver to the transferee a Definitive Security of such
series in the appropriate principal amount.
(ii) Definitive Securities of any series issued in exchange
for a beneficial interest in a Global Security for such series pursuant to
this Section 2.6(d) shall be registered in such names and in such
authorized denominations as the Depository for such series, pursuant to
instructions from its direct or indirect participants or otherwise, shall
instruct the Trustee. The Registrar for such series shall deliver such
Definitive Securities to the persons in whose names such Securities are so
registered.
(e) RESTRICTIONS ON TRANSFER AND EXCHANGE OF GLOBAL SECURITIES.
Notwithstanding any other provisions of this Indenture (other than the
provisions set forth in subsection (f) of this Section 2.6), a Global Security
of any series may not be transferred as a whole except by the Depository for
such series to a nominee of such Depository or by a nominee of such Depository
to such Depository or another nominee of such Depository or by such Depository
or any such nominee to a successor Depository or a nominee of such successor
Depository.
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(f) AUTHENTICATION OF DEFINITIVE SECURITIES IN ABSENCE OF
DEPOSITORY. If at any time:
(i) the Depository for the Securities of any series
notifies the Issuers that such Depository is unwilling or unable to
continue as Depository for the Global Securities of such series and a
successor Depository for the Global Securities of such series is not
appointed by the Issuers within 90 days after delivery of such notice; or
(ii) the Issuers, in their sole discretion, notify the
Trustee in writing that they elect to cause the issuance of Definitive
Securities of any series under this Indenture,
then the Issuers will execute, and the Trustee, upon receipt of an Officers'
Certificate requesting the authentication and delivery of Definitive Securities
of such series, will authenticate and make available for delivery Definitive
Securities of such series, in an aggregate principal amount equal to the
principal amount of the Global Securities of such series, in exchange for such
Global Securities.
(g) CANCELATION AND/OR ADJUSTMENT OF GLOBAL SECURITY. At such
time as all beneficial interests in a Global Security of any series have either
been exchanged for Definitive Securities, redeemed, repurchased or canceled,
such Global Security shall be returned to or retained and canceled by the
Trustee. At any time prior to such cancelation, if any beneficial interest in a
Global Security of any series is exchanged for Definitive Securities of such
series, redeemed, repurchased or canceled, the principal amount of Securities of
such series represented by such Global Security shall be reduced and an
endorsement shall be made on such Global Security, by the Trustee or the
Securities Custodian for such series, at the direction of the Trustee, to
reflect such reduction.
(h) OBLIGATIONS WITH RESPECT TO TRANSFERS AND EXCHANGES OF
DEFINITIVE SECURITIES.
(i) To permit registrations of transfers and exchanges, the
Issuers shall execute and the Trustee shall authenticate Definitive
Securities and Global Securities of any series at the request of the
Registrar or co-Registrar for such series.
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(ii) No service charge shall be made for any registration
of transfer or exchange, but the Issuers may require payment of a sum
sufficient to cover any transfer tax, assessments, or similar governmental
charge payable in connection therewith (other than any such transfer taxes,
assessments, or similar governmental charge payable upon exchanges or
transfers pursuant to Section 2.2, 2.10, 3.6, 4.13, 9.5 or 10.1).
(iii) Except for a redemption of Securities pursuant to
Section 3.2 or upon an order of any Gaming Authority, the Registrar or
co-Registrar for a series of Securities shall not be required to register
the transfer of or exchange of (a) any Definitive Security of such series
selected for redemption in whole or in part pursuant to Article III, except
the unredeemed portion of any Definitive Security of such series being
redeemed in part, or (b) any Security of such series for a period beginning
15 days before the mailing of a notice of an offer to repurchase pursuant
to Article X or Section 4.13 hereof (to the extent applicable to such
series) or a notice of redemption of Securities pursuant to Article III
hereof and ending at the close of business on the day of such mailing.
(iv) All Definitive Securities and Global Securities of any
series issued upon any registration of transfer or exchange of Definitive
Securities or Global Securities of such series shall be the valid
obligations of the Issuers, evidencing the same debt, and entitled to the
same benefits under the Indenture, as the Definitive Securities or Global
Securities of such series surrendered upon such registration of transfer or
exchange.
(v) Except for a redemption of Securities pursuant to
Section 3.2 or upon an order of any Gaming Authority, the Issuers shall not
be required
(1) to issue, register the transfer or exchange of or
exchange any Security of any series for a period beginning 15 days before
the mailing of a notice of an offer to repurchase pursuant to Article X or
Section 4.13 hereof (to the extent applicable to such series) or a notice
of redemption of
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Securities pursuant to Article III hereof and ending at the close of
business on the day of such mailing, or
(2) to register the transfer or exchange of any
Definitive Security of such series selected for redemption in whole or in
part pursuant to Article III, except the unredeemed portion of any
Definitive Security of such series being redeemed in part.
(vi) Prior to due presentment for registration of transfer
of any Security of a series, the Trustee, any Agent and the Issuers may
deem and treat the person in whose name such Security is registered as the
absolute owner of such Security for the purpose of receiving payment of
principal of and interest on such Security and for all other purposes
whatsoever, whether or not such Security is overdue, and neither the
Trustee, any Agent nor the Issuers shall be affected by notice to the
contrary.
Section 2.7 REPLACEMENT SECURITIES.
If a mutilated Security of any series is surrendered to the Trustee or
if the Holder of a Security of any series claims and submits an affidavit or
other evidence, satisfactory to the Trustee, to the Trustee to the effect that
such Security has been lost, destroyed or wrongfully taken, the Issuers shall
issue and the Trustee shall authenticate a replacement Security of such series
if the Trustee's requirements are met. If required by the Trustee or the
Issuers, such Holder must provide an indemnity bond or other indemnity,
sufficient in the judgment of both the Issuers and the Trustee, to protect the
Issuers, the Trustee or any Agent from any loss which any of them may suffer if
a Security of any series is replaced. The Issuers may charge such Holder for
their reasonable, out-of-pocket expenses in replacing a Security of any series.
Every replacement Security is an additional obligation of the Issuers.
Section 2.8 OUTSTANDING SECURITIES.
Securities of any series outstanding at any time are all the
Securities of such series that have been authenticated by the Trustee except
those canceled by it, those delivered to it for cancelation, those reductions in
the interest in a Global
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Security for such series effected by the Trustee hereunder and those described
in this Section 2.8 as not outstanding. A Security does not cease to be
outstanding because the Issuers or an Affiliate of the Issuers holds the
Security, except as provided in Section 2.9.
If a Security of any series is replaced pursuant to Section 2.7 (other
than a mutilated Security surrendered for replacement), it ceases to be
outstanding unless the Trustee receives proof satisfactory to it that the
replaced Security is held by a BONA FIDE purchaser. A mutilated Security ceases
to be outstanding upon surrender of such Security and replacement thereof
pursuant to Section 2.7.
If, with respect to a series of Securities, on a Redemption Date or
the Maturity Date the Paying Agent (other than the Issuers or an Affiliate of
the Issuers) holds Cash sufficient to pay all of the principal and interest due
on the Securities of such series payable on that date and payment of such
Securities called for redemption is not otherwise prohibited, then on and after
that date such Securities cease to be outstanding and interest on them ceases to
accrue.
For each series of Original Issue Discount Securities, the principal
amount of such Securities that shall be deemed to be outstanding and used to
determine whether the necessary Holders have given any request, demand,
authorization, direction, notice, consent or waiver shall be the principal
amount of such Securities that could be declared to be due and payable upon
acceleration upon an Event of Default as of the date of such determination.
When requested by the Trustee, the Issuers will advise the Trustee in writing of
such amount, showing its computations in reasonable detail.
Section 2.9 TREASURY SECURITIES.
In determining whether the Holders of the required principal amount of
Securities of any series have concurred in any direction, amendment, supplement,
waiver or consent, Securities of such series owned by the Issuers, any Guarantor
and Affiliates of the Issuers or of any Guarantor shall be disregarded, except
that, for the purposes of determining whether the Trustee shall be protected in
relying on any such direction, amendment, supplement, waiver or consent, only
Securities of such series that a Trust Officer of the Trustee actually knows are
so owned shall be disregarded.
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Section 2.10 TEMPORARY SECURITIES.
Until definitive Securities of any series are ready for delivery, the
Issuers may prepare, the Guarantors, if any, shall endorse and the Trustee shall
authenticate temporary Securities of such series. Temporary Securities of any
series shall be substantially in the form of definitive Securities of such
series but may have variations that the Issuers reasonably and in good faith
consider appropriate for temporary Securities of such series. Without
unreasonable delay, the Issuers shall prepare, the Guarantors, if any, shall
endorse and the Trustee shall authenticate definitive Securities of any series
in exchange for temporary Securities of such series. Until so exchanged, the
temporary Securities shall in all respects be entitled to the same benefits
under this Indenture as permanent Securities authenticated and delivered
hereunder.
Section 2.11 CANCELATION.
The Issuers at any time may deliver Securities of any series to the
Trustee for cancelation. With respect to a series of Securities, the Registrar
and the Paying Agent for such series of Securities shall forward to the Trustee
Securities of such series surrendered to them for transfer, exchange or payment.
With respect to a series of Securities, the Trustee, or at the direction of the
Trustee, the Registrar or the Paying Agent (other than the Issuers or an
Affiliate of the Issuers) for such series, and no one else, shall cancel and, at
the written direction of the Issuers, shall dispose of all Securities of such
series surrendered for transfer, exchange, payment or cancelation in accordance
with its customary procedures. Subject to Section 2.7, the Issuers may not
issue new Securities of any series to replace Securities of such series they
have paid or delivered to the Trustee for cancelation. No Securities of any
series shall be authenticated in lieu of or in exchange for any Securities of
such series canceled as provided in this Section 2.11, except as expressly
permitted in the form of such series of Securities and as permitted by this
Indenture.
Section 2.12 DEFAULTED INTEREST.
If the Issuers default on a payment of interest on the Securities of
any series, the Issuers shall pay the defaulted interest, plus (to the extent
lawful) interest on the defaulted interest, to the persons who are Holders of
such series on a Record Date (or at the Issuers' option a subsequent special
record date), which date shall be the fifteenth day next
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preceding the date fixed by the Issuers for the payment of defaulted interest,
whether or not such day is a Business Day, unless the Trustee fixes another
record date. At least 15 days before the subsequent special record date, the
Issuers shall mail to each Holder with a copy to the Trustee a notice that
states the subsequent special record date, the payment date and the amount of
defaulted interest, and interest payable on such defaulted interest, if any, to
be paid.
Section 2.13 CUSIP NUMBERS.
The Issuers in issuing Securities of any series may use "CUSIP"
numbers (if then generally in use), and, if so, the Trustee shall use "CUSIP"
numbers in notices of redemption as a convenience to Holders of such series;
PROVIDED that any such notice may state that no representation is made as to the
correctness of such numbers either as printed on the Securities of such series
or as contained in any notice of a redemption and that reliance may be placed
only on the other identification numbers printed on the Securities of such
series, and any such redemption shall not be affected by any defect in or
omission of such numbers. The Issuers will promptly notify the Trustee of any
change in the CUSIP numbers.
ARTICLE III
REDEMPTION
The provisions of this Article III shall be applicable to the
Securities of any series unless this Article III is designated, pursuant to
Section 2.3, as being inapplicable to the Securities of such series. In
addition, it shall be established prior to the issuance of any series of
Securities, pursuant to Section 2.3, whether any provision concerning redemption
of the Securities, other than or in addition to those specified below, shall be
applicable to such series. Provisions of this Article III designated, pursuant
to Section 2.3, as being inapplicable to a particular series of Securities shall
have no force and effect as to the Securities of such series. In each provision
of this Article III, unless the context otherwise requires, all references to
Securities and any other defined terms refer only to a single series of
Securities for which such provision has not been designated, pursuant to
Section 2.3, as being inapplicable. Notwithstanding the foregoing, each series
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of Securities shall be subject to the provisions in Section 3.2 relating to
Required Regulatory Redemptions.
Section 3.1 RIGHT OF REDEMPTION.
At their election, the Issuers may redeem the Securities in whole or
in part, at any time or from time to time on or after the date specified
pursuant to Section 2.3, at the Redemption Prices specified pursuant to
Section 2.3, plus accrued but unpaid interest to the Redemption Date. Except as
provided in this paragraph, the next following paragraph, Section 3.2 and the
terms of the Securities, the Securities may not otherwise be redeemed at the
option of the Issuers.
On or prior to March 15, 2000, upon a Public Equity Offering of
Ordinary Shares for Cash of Sun International, up to 35% of the aggregate
principal amount of the Securities may be redeemed at the option of the Issuers
with Cash from the Net Cash Proceeds of such Public Equity Offering, at 109% of
the principal amount thereof (subject to the right of Holders of record on a
Record Date to receive interest due on an Interest Payment Date that is on or
prior to such Redemption Date), plus accrued but unpaid interest to the date of
redemption; PROVIDED, HOWEVER, that immediately following each such redemption
not less than 65% of the aggregate principal amount of the Securities are
outstanding, PROVIDED, FURTHER that such redemption shall occur within 120 days
of such Public Equity Offering.
Securities may be redeemed at the option of the Issuers, in whole but
not in part, upon not less than 30 nor more than 60 days' notice given as
provided herein, at any time at a redemption price equal to the principal amount
thereof, plus accrued and unpaid interest, if any, thereon, to the date fixed
for redemption if, as a result of any change in or amendment to the laws,
treaties, rulings or regulations of The Bahamas, or of any political subdivision
or taxing authority thereof or therein, or any change in the official position
of the applicable taxing authority regarding the application or interpretation
of such laws, treaties, rulings or regulations (including a holding judgment or
order of a court of competent jurisdiction) or any execution thereof or
amendment thereto, which is enacted into law or otherwise becomes effective
after the Issue Date, either Issuer is or would be required on the next
succeeding Interest Payment Date to pay Additional Amounts on the Securities as
a result of the imposition of a Bahamian withholding tax and the payment of such
Additional Amounts cannot be avoided by the use of any reasonable measures
available to the Issuers which do not
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cause the Issuers to incur any material costs. The Issuers shall also pay to
holders on the redemption date any Additional Amounts then due and which will
become due as a result of the redemption or would otherwise be payable.
Prior to the publication of any notice of redemption in accordance
with the foregoing, the Issuers shall deliver to the Trustee an Officers'
Certificate stating that (i) the payment of Additional Amounts cannot be avoided
by the use of any reasonable measures available to the Issuers which do not
cause the Issuers to incur any material costs and (ii) the Issuers are entitled
to effect such redemption based on the written, substantially unqualified
Opinion of Counsel, which counsel shall be reasonably acceptable to the Trustee,
that the Issuers have or will become obligated to pay Additional Amounts as a
result of such change or amendment. The notice, once delivered by the Issuers
to the Trustee, will be irrevocable.
Section 3.2 REDEMPTION PURSUANT TO GAMING LAWS.
If a Holder or a beneficial owner of Securities is required by any
Gaming Authority to be found suitable to hold the Securities, the Holder shall
apply for a finding of suitability within 30 days after a Gaming Authority
request or sooner if so required by such Gaming Authority. The applicant for a
finding of suitability must pay all costs of the investigation for such finding
of suitability. If a Holder or beneficial owner is required to be found
suitable to hold the Securities and is not found suitable by a Gaming Authority,
the Holder shall, to the extent required by applicable law, dispose of his
Securities within 30 days or within that time prescribed by a Gaming Authority,
whichever is earlier. If the Holder fails to dispose of his Securities within
such time period, the Issuers may, at their option, redeem such Holder's
Securities (a "Required Regulatory Redemption") at, depending on applicable law,
(i) the principal amount thereof, together with accrued and unpaid interest to
the date of the finding of unsuitability by a Gaming Authority, (ii) the amount
that such Holder paid for the Securities, (iii) the fair market value of the
Securities, (iv) the lowest of clauses (i), (ii) and (iii), or (v) such other
amount as may be determined by the appropriate Gaming Authority.
Section 3.3 NOTICES TO TRUSTEE.
If the Issuers elect to redeem Securities pursuant to this Article
III, they shall notify the Trustee in writing of the date on which the
Securities are to be redeemed ("Redemption
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Date") and the principal amount of Securities to be redeemed and whether they
want the Trustee to give notice of redemption to the Holders in the name of and
at the expense of the Issuers.
If the Issuers elect to reduce the principal amount of Securities to
be redeemed pursuant to the terms of the Securities by crediting against any
such redemption Securities it has not previously delivered to the Trustee for
cancelation, it shall so notify the Trustee of the amount of the reduction and
deliver such Securities with such notice.
The Issuers shall give each notice to the Trustee provided for in this
Section 3.3 at least 45 days (unless a shorter period is acceptable to the
Trustee) before the Redemption Date (unless a different notice period shall be
required by a Gaming Authority with respect to a Required Regulatory
Redemption).
Section 3.4 SELECTION OF SECURITIES TO BE REDEEMED.
If less than all of the Securities are to be redeemed (except in the
case of a Required Regulatory Redemption), the Trustee shall select from among
such Securities to be redeemed pro rata or by lot or by such other method as the
Trustee shall determine to be fair and appropriate and in such manner as
complies with any applicable legal and stock exchange requirements.
The Trustee shall make the selection from the Securities outstanding
and not previously called for redemption and shall promptly notify the Issuers
in writing of the Securities selected for redemption and, in the case of any
such Security selected for partial redemption, the principal amount thereof to
be redeemed. Securities in denominations of $1,000 may be redeemed only in
whole. The Trustee may select for redemption portions (equal to $1,000 or any
integral multiple thereof) of the principal of Securities that have
denominations larger than $1,000. Provisions of this Indenture that apply to
Securities called for redemption also apply to portions of Securities called for
redemption.
Section 3.5 NOTICE OF REDEMPTION.
At least 30 days but not more than 60 days before a Redemption Date,
the Issuers shall mail a notice of redemption by first class mail, postage
prepaid, to each Holder whose Securities are to be redeemed (unless a different
notice period shall
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be required by any Gaming Authority). At the Issuers' request, the Trustee
shall give the notice of redemption in the Issuers' name and at the Issuers'
expense. Each notice for redemption shall identify the Securities to be
redeemed (including the series) and shall state:
(1) the Redemption Date;
(2) the Redemption Price, including the amount of
accrued but unpaid interest to be paid upon such redemption;
(3) the name, address and telephone number of the
Paying Agent for the Securities being redeemed;
(4) that Securities called for redemption must be
surrendered to the Paying Agent for such Securities at the address
specified in such notice to collect the Redemption Price;
(5) that, unless (a) the Issuers default in their
obligation to deposit Cash with the Paying Agent in accordance with Section
3.7 hereof, interest on Securities called for redemption ceases to accrue
on and after the Redemption Date and the only remaining right of the
Holders of such Securities is to receive payment of the Redemption Price,
including accrued but unpaid interest, upon surrender to the Paying Agent
of the Securities called for redemption and to be redeemed;
(6) if any Security is being redeemed in part, the
portion of the principal amount, equal to $1,000 or any integral multiple
thereof, of such Security to be redeemed and that, after the Redemption
Date, and upon surrender of such Security, a new Security or Securities in
aggregate principal amount equal to the unredeemed portion thereof will be
issued;
(7) if less than all Securities are to be redeemed,
the identification of the particular Securities (or portion thereof) to be
redeemed, as well as the aggregate principal amount of such Securities to
be redeemed and the aggregate principal amount
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of Securities to be outstanding after such partial redemption;
(8) the CUSIP number of the Securities to be redeemed;
and
(9) that the notice is being sent pursuant to this
Section 3.5 and pursuant to the optional redemption provisions of the terms
of the Securities.
Section 3.6 EFFECT OF NOTICE OF REDEMPTION.
Once notice of redemption is mailed in accordance with Section 3.5,
Securities called for redemption become due and payable on the Redemption Date
and at the Redemption Price set forth in the terms of such Securities, including
accrued but unpaid interest. Upon surrender to the Trustee or Paying Agent,
such Securities called for redemption shall be paid at the Redemption Price,
including interest, if any, accrued to and unpaid on the Redemption Date;
PROVIDED that if the Redemption Date is after a regular Record Date and on or
prior to the Interest Payment Date, the accrued interest shall be payable to the
Holder of the redeemed Securities registered on the relevant Record Date; and
PROVIDED FURTHER that if a Redemption Date is a Legal Holiday, payment shall be
made on the next succeeding Business Day and no interest shall accrue for the
period from such Redemption Date to such succeeding Business Day.
Section 3.7 DEPOSIT OF REDEMPTION PRICE.
On or before the Redemption Date, the Issuers shall deposit with the
Paying Agent (other than the Issuers or an Affiliate of either of the Issuers)
Cash sufficient to pay the Redemption Price of, including accrued but unpaid
interest on, all Securities to be redeemed on such Redemption Date (other than
Securities or portions thereof called for redemption on that date that have been
delivered by the Issuers to the Trustee for cancelation). The Paying Agent
shall promptly return to the Issuers any Cash so deposited that is not required
for that purpose upon the written request of the Issuers.
If the Issuers comply with the preceding paragraph and the other
provisions of this Article III and payment of the Securities called for
redemption is not otherwise prohibited, interest on the Securities to be
redeemed will cease to accrue on the applicable Redemption Date, whether or not
such Securities
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are presented for payment. Notwithstanding anything herein to the contrary, if
any Security surrendered for redemption in the manner provided in the Securities
shall not be so paid upon surrender for redemption because of the failure of the
Issuers to comply with the preceding paragraph and the other provisions of this
Article III, interest shall continue to accrue and be paid from the Redemption
Date until such payment is made on the unpaid principal, and, to the extent
lawful, on any interest not paid on such unpaid principal, in each case at the
rate and in the manner provided in Section 4.1 hereof and the Securities.
Section 3.8 SECURITIES REDEEMED IN PART.
Upon surrender of a Security that is to be redeemed in part, the
Issuers shall execute and the Trustee shall authenticate and deliver to the
Holder, without service charge, a new Security or Securities equal in principal
amount to the unredeemed portion of the Security surrendered.
ARTICLE IV
COVENANTS
Any or all of the provisions of this Article IV shall be applicable to
the Securities of any series for which such provision or provisions are
designated as applicable pursuant to the terms of Section 2.3. In addition, it
shall be established prior to the issuance of any series of Securities, pursuant
to Section 2.3, whether any covenant or covenants other than or in addition to
those specified below shall be applicable to such series. Provisions of this
Article IV not designated, pursuant to Section 2.3, as applying to a particular
series of Securities shall have no force and effect as to the Securities of such
series. In each provision of this Article IV, unless the context otherwise
requires, all references to Securities and any other defined terms refer only to
a single series of Securities for which such provision has been designated,
pursuant to Section 2.3, as being applicable.
Section 4.1 PAYMENT OF SECURITIES.
The Issuers shall pay the principal of and interest on the Securities
on the dates and in the manner provided in the Securities and this Indenture.
An installment of principal of or interest on Securities shall be considered
paid on the date it is due if the Trustee or Paying Agent (other than the
Issuers or an
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Affiliate of either of the Issuers) holds for the benefit of the Holders, on or
before 10:00 a.m., New York City time, on that date, Cash deposited and
designated for and sufficient to pay the installment.
The Issuers shall pay interest on overdue principal and on overdue
installments of interest at the rate specified in the Securities, to the extent
lawful.
Section 4.2 MAINTENANCE OF OFFICE OR AGENCY.
The Issuers and the Guarantors, if any, shall maintain in the Borough
of Manhattan, The City of New York, an office or agency where Securities may be
presented or surrendered for payment, where Securities may be surrendered for
registration of transfer or exchange and where notices and demands to or upon
the Issuers and the Guarantors, if any, in respect of the Securities and this
Indenture may be served. The Issuers and the Guarantors, if any, shall give
prompt written notice to the Trustee of the location, and any change in the
location, of such office or agency. If at any time the Issuers and the
Guarantors, if any, shall fail to maintain any such required office or agency or
shall fail to furnish the Trustee with the address thereof, such presentations,
surrenders, notices and demands may be made or served at the address of the
Trustee set forth in Section 13.2.
The Issuers and the Guarantors, if any, may also from time to time
designate one or more other offices or agencies where the Securities may be
presented or surrendered for any or all such purposes and may from time to time
rescind such designations; PROVIDED, HOWEVER, that no such designation or
rescission shall in any manner relieve the Issuers and the Guarantors, if any,
of their obligation to maintain an office or agency in the Borough of Manhattan,
The City of New York, for such purposes. The Issuers and the Guarantors, if
any, shall give prompt written notice to the Trustee of any such designation or
rescission and of any change in the location of any such other office or agency.
The Issuers and the Guarantors, if any, hereby initially designate the principal
corporate trust office of the Trustee as such office.
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Section 4.3 LIMITATION ON RESTRICTED PAYMENTS.
The Issuers and the Guarantors, if any, shall not, and shall not
permit any of their Subsidiaries to, individually or collectively, directly or
indirectly, make any Restricted Payment if, after giving effect to such
Restricted Payment on a PRO FORMA basis, (i) a Default or an Event of Default
shall have occurred and be continuing, (ii) Sun International is not permitted
to incur at least $1.00 of additional Indebtedness pursuant to the Debt
Incurrence Ratio contained in Section 4.10 (to the extent applicable) or (iii)
the aggregate amount of all Restricted Payments made by Sun International and
its Subsidiaries, including after giving effect to such proposed Restricted
Payment, from and after the Issue Date, would exceed the sum of (a) 50% of the
aggregate Consolidated Net Income of Sun International for the period (taken as
one accounting period) commencing January 1, 1996 to and including the last day
of the fiscal quarter ended immediately prior to the date of each such
calculation (or, in the event Consolidated Net Income for such period is a
deficit, then minus 100% of such deficit) (not giving pro forma effect to the
acquisition of Griffin Gaming & Entertainment, Inc. for periods prior to its
consummation), plus (b) the aggregate Net Cash Proceeds received by Sun
International from the sale of its Qualified Capital Stock (other than (i) to a
Subsidiary of Sun International and (ii) to the extent applied in connection
with a Qualified Exchange) after the Issue Date, plus (c) $50 million.
The immediately preceding paragraph, however, will not prohibit (x) a
Qualified Exchange, (y) the payment of any dividend on Capital Stock within 60
days after the date of its declaration if such dividend could have been made on
the date of such declaration in compliance with the foregoing provisions and (z)
the redemption or repurchase of any Capital Stock or Indebtedness of the Issuers
or their Subsidiaries (other than Capital Stock or Indebtedness held by Sun
International Investments Limited, its shareholders or Permitted Holders), if
the holder or beneficial owner of such Capital Stock or Indebtedness is required
to be found suitable by any Gaming Authority to own or vote any security and is
found unsuitable by any such Gaming Authority to so own or vote such security.
The full amount of any Restricted Payment made pursuant to the foregoing clauses
(y) and (z) (but not pursuant to clause (x)) of the immediately preceding
sentence, however, will be deducted in the calculation of the aggregate amount
of Restricted Payments available to be made referred to in clause (iii) of the
immediately preceding paragraph.
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Section 4.4 CORPORATE EXISTENCE.
Subject to Article V, the Issuers and the Guarantors, if any, shall do
or cause to be done all things necessary to preserve and keep in full force and
effect their corporate existence and the corporate or other existence of each of
their Subsidiaries in accordance with the respective organizational documents of
each of them and the rights (charter and statutory) and corporate franchises of
the Issuers and the Guarantors, if any, and each of their Subsidiaries;
PROVIDED, HOWEVER, that neither the Issuers nor any of the Guarantors, if any,
shall be required to preserve, with respect to itself, any right or franchise,
and with respect to any of their Subsidiaries, any such existence, right or
franchise, if (a) the Board of Directors of Sun International shall determine
reasonably and in good faith that the preservation thereof is no longer
desirable in the conduct of the business of the Issuers and (b) the loss thereof
is not disadvantageous in any material respect to the Holders.
Section 4.5 PAYMENT OF TAXES AND OTHER CLAIMS.
The Issuers and the Guarantors, if any, shall, and shall cause each of
their Subsidiaries to, pay or discharge or cause to be paid or discharged,
before the same shall become delinquent, (i) all taxes, assessments and
governmental charges (including withholding taxes and any penalties, interest
and additions to taxes) levied or imposed upon the Issuers, any Guarantor or any
of their Subsidiaries or properties and assets of the Issuers, any Guarantor or
any of their Subsidiaries and (ii) all lawful claims, whether for labor,
materials, supplies, services or anything else, which have become due and
payable and which by law have or may become a Lien upon the property and assets
of the Issuers, any Guarantor or any of their Subsidiaries; PROVIDED, HOWEVER,
that neither the Issuers nor any Guarantor shall be required to pay or discharge
or cause to be paid or discharged any such tax, assessment, charge or claim
whose amount, applicability or validity is being contested in good faith by
appropriate proceedings and for which disputed amounts adequate reserves have
been established in accordance with GAAP.
Section 4.6 COMPLIANCE CERTIFICATE; NOTICE OF DEFAULT.
The Issuers shall deliver to the Trustee within 120 days after the end of their
fiscal year an Officers' Certificate, one of the signers of which shall be the
principal executive, financial or accounting officer of the Issuers, comply-
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ing (whether or not required) with Section 314(a)(4) of the TIA and stating that
a review of their activities and the activities of their Subsidiaries during the
preceding fiscal year has been made under the supervision of the signing
Officers with a view to determining whether the Issuers have kept, observed,
performed and fulfilled their obligations (without regard to notice requirements
or grace periods) under this Indenture and further stating, as to each such
Officer signing such certificate, whether or not the signer knows of any failure
by the Issuers, any Guarantor or any Subsidiary of the Issuers or any Guarantor
to comply with any conditions or covenants in this Indenture and, if such signer
does know of such a failure to comply, the certificate shall describe such
failure with particularity. The Officers' Certificate shall also notify the
Trustee should the relevant fiscal year-end on any date other than the current
fiscal year end date.
(b) So long as not contrary to the then current recommendation
of the American Institute of Certified Public Accountants, the Issuers shall
deliver to the Trustee within 120 days after the end of each of their fiscal
years a written report of a firm of independent certified public accountants
with an established national reputation stating that in conducting their audit
for such fiscal year, nothing has come to their attention that caused them to
believe that the Issuers or any Subsidiary of the Issuers were not in compliance
with the provisions set forth in Section 4.3, 4.10 or 4.13 (in each case, to the
extent applicable) or Article X of this Indenture.
(c) The Issuers shall, so long as any of the Securities are
outstanding, deliver to the Trustee, immediately upon becoming aware of any
Default or Event of Default under this Indenture, an Officers' Certificate
specifying such Default or Event of Default and what action the Issuers are
taking or propose to take with respect thereto. The Trustee shall not be deemed
to have knowledge of a Default or an Event of Default unless one of its Trust
Officers receives notice of the Default giving rise thereto from the Issuers or
any of the Holders.
Section 4.7 REPORTS.
Whether or not Sun International or SINA is subject to the reporting
requirements of Section 13 or 15(d) of the Exchange Act, each of Sun
International and SINA shall deliver to the Trustee and to each Holder within 15
days after it is or would have been (if it were subject to such reporting
obligations) required to furnish such with the Commission, annual and quarterly
financial statements substantially equivalent to financial
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statements that would have been included in reports filed with the Commission,
if such entity were subject to the requirements of Section 13 or 15(d) of the
Exchange Act, including, with respect to annual information only, a report
thereon by the Issuers' certified independent public accountants as such would
be required in such reports to the Commission, and, in each case, together with
a management's discussion and analysis of financial condition and results of
operations which would be so required and, to the extent permitted by the
Exchange Act or the Commission, file with the Commission the annual, quarterly
and other reports which it is or would have (if it were subject to such
reporting obligations) been required to file with the Commission. 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
constructive notice of any information contained therein or determinable from
information contained therein, including the Issuers' compliance with any of
their covenants hereunder (as to which the Trustee is entitled to rely
exclusively on Officers' Certificates).
Section 4.8 WAIVER OF STAY, EXTENSION OR USURY LAWS.
Each of the Issuers and each Guarantor, if any, covenants (to the
extent that it may lawfully do so) that it will not at any time insist upon,
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 wherever enacted which
would prohibit or forgive the Issuers or any Guarantor from paying all or any
portion of the principal of or interest on the Securities as contemplated
herein, wherever enacted, now or at any time hereafter in force, or which may
affect the covenants or the performance of this Indenture; and (to the extent
that they may lawfully do so) each of the Issuers and each Guarantor, if any,
hereby expressly waives all benefit or advantage of any such law insofar as such
law applies to the Securities, and covenants that it shall not hinder, delay or
impede the execution of any power herein granted to the Trustee, but will suffer
and permit the execution of every such power as though no such law had been
enacted.
Section 4.9 LIMITATION ON TRANSACTIONS WITH AFFILIATES.
None of the Issuers or any of their Subsidiaries will be permitted on
or after the Issue Date to enter into or suffer to exist any contract,
agreement, arrangement or transaction with any Affiliate (an "Affiliate
Transaction"), or any series of
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related Affiliate Transactions (other than Exempted Affiliate Transactions) (i)
unless it is determined that the terms of such Affiliate Transaction are fair
and reasonable to Sun International or such Subsidiary, as applicable, and no
less favorable to Sun International or such Subsidiary, as applicable, than
could have been obtained in an arm's length transaction with a non-Affiliate and
(ii) if involving consideration to either party in excess of $2 million, unless
such Affiliate Transaction(s) has been approved by a majority of the members of
the Board of Directors that are disinterested in such transaction and (iii) if
involving consideration to either party in excess of $15 million, unless in
addition to the foregoing Sun International, prior to the consummation thereof,
obtains a written favorable opinion as to the fairness of such transaction to
Sun International from a financial point of view from an independent investment
banking firm of national reputation.
Section 4.10 LIMITATION ON INCURRENCE OF ADDITIONAL INDEBTEDNESS AND
DISQUALIFIED CAPITAL STOCK.
Except as set forth below in this covenant, the Issuers and the
Guarantors, if any, will not, and will not permit any of their Subsidiaries to,
individually or collectively, directly or indirectly, issue, assume, guaranty,
incur, become directly or indirectly liable with respect to (including as a
result of an Acquisition), or otherwise become responsible for, contingently or
otherwise (individually and collectively, to "incur" or, as appropriate, an
"incurrence"), any Indebtedness or any Disqualified Capital Stock (including
Acquired Indebtedness), except Permitted Indebtedness. Notwithstanding the
foregoing, if (i) no Event of Default shall have occurred and be continuing at
the time of, or would occur after giving effect on a PRO FORMA basis to, such
incurrence of Indebtedness or Disqualified Capital Stock and (ii) on the date of
such incurrence (the "Incurrence Date"), the Consolidated Coverage Ratio of Sun
International for the Reference Period immediately preceding the Incurrence
Date, after giving effect on a PRO FORMA basis to such incurrence of such
Indebtedness or Disqualified Capital Stock and, to the extent set forth in the
definition of Consolidated Coverage Ratio, the use of proceeds thereof, would be
at least 2.0 to l (the "Debt Incurrence Ratio"), then the Issuers and the
Guarantors, if any, may incur such Indebtedness or Disqualified Capital Stock.
Acquired Indebtedness shall be deemed to have been incurred at the
time the person who incurred such Indebtedness becomes a Subsidiary of either of
the Issuers (including upon designation of any Unrestricted Subsidiary or other
person as a
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Subsidiary) or is merged with or into or consolidated with either of the Issuers
or a Subsidiary of either of the Issuers, as applicable.
Section 4.11 LIMITATION ON DIVIDENDS AND OTHER PAYMENT RESTRICTIONS
AFFECTING SUBSIDIARIES.
The Issuers and the Guarantors, if any, will not, and will not permit
any of their Subsidiaries to, individually or collectively, directly or
indirectly, create, assume or suffer to exist any consensual restriction on the
ability of any Subsidiary of Sun International, SINA or such Guarantor, if any,
to pay dividends or make other distributions to or on behalf of, or to pay any
obligation to or on behalf of, or otherwise to transfer assets or property to or
on behalf of, or make or pay loans or advances to or on behalf of, Sun
International, SINA, the Guarantors, if any, or any Subsidiary of any of them,
or to guaranty the Securities, except (a) restrictions imposed by the Securities
or herein, (b) restrictions imposed by applicable law, (c) existing restrictions
under the Credit Agreement, (d) restrictions under any Acquired Indebtedness not
incurred in violation of the Indenture or any agreement relating to any
property, asset, or business acquired by Sun International or any of its
Subsidiaries, which restrictions in each case existed at the time of
acquisition, were not put in place in connection with or in anticipation of such
acquisition and are not applicable to any person, other than the person
acquired, or to any property, asset or business, other than the property, assets
and business so acquired, (e) any such restriction or requirement imposed by
Indebtedness incurred under paragraph (a) of the definition of "Permitted
Indebtedness," provided such restriction or requirement is no more restrictive
than that imposed by the Credit Agreement as of the Issue Date, (f) restrictions
with respect solely to a Subsidiary of Sun International imposed pursuant to a
binding agreement that has been entered into for the sale or disposition of all
or substantially all of the Equity Interests or assets of such Subsidiary,
provided such restrictions apply solely to the Equity Interests or assets of
such Subsidiary that are being sold, (g) restrictions on transfer contained in
FF&E Indebtedness incurred pursuant to paragraph (c) of the definition of
"Permitted Indebtedness," provided such restrictions relate only to the transfer
of the property acquired with the proceeds of such FF&E Indebtedness, and (h) in
connection with and pursuant to Permitted Refinancings, replacements of
restrictions imposed pursuant to clauses (a), (c) or (d) of this paragraph that
are not more restrictive than those being replaced and do not apply to any other
person or assets than those that would
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have been covered by the restrictions in the Indebtedness so refinanced.
Notwithstanding the foregoing, neither (a) customary provisions restricting
subletting or assignment of any lease, license or contract entered into in the
ordinary course of business, consistent with industry practice, nor (b) Liens
permitted under the terms of the Indenture shall in and of themselves be
considered a restriction on the ability of the applicable Subsidiary to transfer
such agreement or assets, as the case may be.
Section 4.12 LIMITATION ON LIENS SECURING INDEBTEDNESS.
The Issuers and the Guarantors, if any, will not, and will not permit
any of their Subsidiaries to, individually or collectively, create, incur,
assume or suffer to exist any Lien of any kind, other than Permitted Liens, upon
any of their respective assets now owned or acquired on or after the date of the
Indenture or upon any income or profits therefrom securing any Indebtedness of
the Issuers, the Guarantors, if any, or any of their Subsidiaries other than
Senior Debt, unless the Issuers and Guarantors, if any, each provide, and cause
their Subsidiaries to provide, concurrently therewith, that the Securities are
equally and ratably so secured, PROVIDED that, if such Indebtedness is
Subordinated Indebtedness, the Lien securing such Subordinated Indebtedness
shall be subordinate and junior to the Lien securing the Securities with the
same relative priority as such Subordinated Indebtedness shall have with respect
to the Securities.
Section 4.13 LIMITATION ON SALE OF ASSETS AND SUBSIDIARY STOCK.
The Issuers and the Guarantors, if any, will not, and will not permit
any of their Subsidiaries to, individually or collectively, in one or a series
of related transactions, convey, sell, transfer, assign or otherwise dispose of,
directly or indirectly, any of its property, business or assets, including by
merger or consolidation (in the case of a Guarantor, if any, or a Subsidiary of
Sun International or SINA), and including any sale or other transfer or issuance
of any Equity Interests of any Subsidiary of Sun International or SINA, whether
by Sun International, SINA or a Subsidiary of either or through the issuance,
sale or transfer of Equity Interests by a Subsidiary of Sun International or
SINA, and including any sale and leaseback transaction (an "Asset Sale"), unless
(i)(a) within 360 days after the date of such Asset Sale, the Net Cash Proceeds
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therefrom (the "Asset Sale Offer Amount") are applied to the optional redemption
of the Securities and all other outstanding series of Securities in accordance
with the terms of the Indenture or to the repurchase of the Securities and all
other outstanding series of Securities pursuant to an irrevocable, unconditional
Cash offer (the "Asset Sale Offer") to repurchase Securities and all other
outstanding series of Securities at a purchase price of 100% of principal amount
(the "Asset Sale Offer Price") together with accrued and unpaid interest to the
date of payment, made within 330 days of such Asset Sale or (b) within 330 days
following such Asset Sale, the Asset Sale Offer Amount is (1) invested in assets
and property (other than notes, bonds, obligation and securities) which in the
good faith judgment of the Board of Directors of Sun International will
immediately constitute or be a part of a Related Business of Sun International,
SINA or such Subsidiary (if it continues to be a Subsidiary) immediately
following such investment or (2) used to permanently reduce Senior Debt
(provided that in the case of a revolver or similar arrangement that makes
credit available, such commitment is so permanently reduced by such amount) or
to purchase or redeem the Issuers' 9% Senior Subordinated Notes due 2007 issued
under an indenture dated as of March 10, 1997, (ii) no more than the greater of
(A) $20 million or (B) 15% of the total consideration for such Asset Sale or
series of related Asset Sales consists of consideration other than Cash or Cash
Equivalents, PROVIDED HOWEVER, that more than 15% of the total consideration may
consist of consideration other than Cash or Cash Equivalents if (A) the portion
of such consideration that does not consist of Cash or Cash Equivalents consists
of assets of a type ordinarily used in the operation of a Related Business
(including Capital Stock of a person that becomes a wholly owned Subsidiary and
that holds such assets) to be used by the Issuers or a Subsidiary in the conduct
of a Related Business, (B) the terms of such Asset Sale have been approved by a
majority of the members of the Board of Directors of Sun International having no
personal stake in such transaction, and (C) if the value of the assets being
disposed of by the Issuers or such Subsidiary in such transaction (as determined
in good faith by such members of the Board of Directors) is at least $10
million, the Board of Directors of Sun International has received a written
opinion of a nationally recognized investment banking firm to the effect that
such Asset Sale is fair, from a financial point of view, to Sun International
and Sun International has delivered a copy of such opinion to the Trustee, (iii)
no Default or Event of Default shall have occurred and be continuing at the time
of, or would occur after giving effect, on a PRO FORMA basis, to, such Asset
Sale, and (iv) if the value of the assets disposed of is at least
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$5 million, the Board of Directors of Sun International determines in good faith
that Sun International or such Subsidiary, as applicable, receives fair market
value for such Asset Sale (as evidenced by a resolution of the Board of
Directors).
Notwithstanding the foregoing provisions of the prior paragraph:
(i) Sun International and its Subsidiaries may, in the ordinary
course of business, convey, sell, transfer, assign or otherwise dispose of
inventory acquired and held for resale in the ordinary course of business;
(ii) Sun International and its Subsidiaries may convey, sell,
transfer, assign or otherwise dispose of assets pursuant to and in
accordance with Article V;
(iii) Sun International and its Subsidiaries may sell or dispose
of damaged, worn out or other obsolete property in the ordinary course of
business so long as such property is no longer necessary for the proper
conduct of the business of Sun International or such Subsidiary, as
applicable;
(iv) the Issuers and the Subsidiaries may convey, sell, transfer,
assign or otherwise dispose of assets to any Issuer or any of their wholly
owned Guarantors, if any; and
(v) the Issuers may sell their Equity Interests in Non-Strategic
Real Estate.
An Asset Sale Offer may be deferred until the accumulated Net Cash
Proceeds from Asset Sales not applied to the uses set forth in (i) above (the
"Excess Proceeds") exceeds $20 million and that each Asset Sale Offer shall
remain open for 20 Business Days following its commencement (the "Asset Sale
Offer Period"). Upon expiration of the Asset Sale Offer Period, the Issuers
shall apply the Asset Sale Offer Amount plus an amount equal to accrued and
unpaid interest to the purchase of all Securities and all other outstanding
series of Securities properly tendered (on a PRO RATA basis if the Asset Sale
Offer Amount is insufficient to purchase all Securities and all other
outstanding series of Securities so tendered) at the Asset Sale Offer Price
(together with accrued and unpaid interest). To the extent that the aggregate
amount of Securities and all other outstanding series of Securities tendered
pursuant to an Asset
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Sale Offer is less than the Asset Sale Offer Amount, the Issuers may use any
remaining Net Cash Proceeds for general corporate purposes as otherwise
permitted by the Indenture and following the consummation of each Asset Sale
Offer the Excess Proceeds amount shall be reset to zero. For purposes of (ii)
above, total consideration received means the total consideration received for
such Asset Sales minus the amount of (a) Senior Debt assumed by a transferee
which assumption permanently reduces the amount of Indebtedness outstanding on
the Issue Date or permitted pursuant to clause (a) or (c) of the definition of
Permitted Indebtedness (including that in the case of a revolver or similar
arrangement that makes credit available, such commitment is so reduced by such
amount), (b) FF&E Indebtedness secured solely by the assets sold and assumed by
a transferee and (c) property that within 30 days of such Asset Sale is
converted into Cash or Cash Equivalents.
All Net Cash Proceeds from an Event of Loss shall be invested, used
for prepayment of Senior Debt, or used to repurchase Securities, all within the
period and as otherwise provided above in clauses (i)(a) or (i)(b) of the first
paragraph of this covenant.
In addition to the foregoing, Sun International will not, and will not
permit any Subsidiary to, directly or indirectly make any Asset Sale of any of
the Equity Interests of any Subsidiary except (i) pursuant to an Asset Sale of
all the Equity Interests of such Subsidiary or (ii) pursuant to an Asset Sale of
shares of common stock with no preferences or special rights or privileges and
with no redemption or prepayment provisions, provided that after such sale the
Issuers or their Subsidiaries own at least 50.1% of the voting and economic
interests of the Capital Stock of such Subsidiary.
Notice of an Asset Sale Offer shall be sent, on or prior to the
commencement of the Asset Sale Offer, by first-class mail, by the Issuers to
each Holder at its registered address, with a copy to the Trustee. The Asset
Sale Offer shall remain open for at least 20 Business Days following its
commencement. The notice to the Holders shall contain all information,
instructions and materials required by applicable law or otherwise material to
such Holders' decision to tender Securities pursuant to the Asset Sale Offer.
The notice, which (to the extent consistent with this Indenture) shall govern
the terms of an Asset Sale Offer, shall state:
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(1) that the Asset Sale Offer is being made pursuant to
such notice and this Section 4.13;
(2) the Asset Sale Offer Amount, the Asset Sale Offer Price
(including the amount of accrued but unpaid interest) and the date of
purchase;
(3) that any Security or portion thereof not tendered or
accepted for payment will continue to accrue interest if interest is then
accruing;
(4) that, unless the Issuers default in depositing Cash
with the Paying Agent (which may not for purposes of this Section 4.13,
notwithstanding anything in this Indenture to the contrary, be the Issuers
or any Affiliate of either of the Issuers) in accordance with the last
paragraph of this clause (b), any Security, or portion thereof, accepted
for payment pursuant to the Asset Sale Offer shall cease to accrue interest
after the Asset Sale Purchase Date;
(5) that Holders electing to have a Security, or portion
thereof, purchased pursuant to an Asset Sale Offer will be required to
surrender their Security, with the form entitled "Option of Holder to Elect
Purchase" on the reverse of the Security completed, to the Paying Agent
(which may not for purposes of this Section 4.13, notwithstanding any other
provision of this Indenture, be the Issuers or any Affiliate of either of
the Issuers) at the address specified in the notice;
(6) that Holders will be entitled to withdraw their
elections, in whole or in part, if the Paying Agent receives, prior to the
expiration of the Asset Sale Offer, a facsimile transmission or letter
setting forth the name of the Holder, the principal amount of the
Securities the Holder is withdrawing and a statement containing a facsimile
signature and stating that such Holder is withdrawing his election to have
such principal amount of Securities purchased;
(7) that if Securities in a principal amount in excess of
the principal amount of
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Securities to be acquired pursuant to the Asset Sale Offer are tendered and
not withdrawn, the Issuers shall purchase Securities on a PRO RATA basis
(with such adjustments as may be deemed appropriate by the Issuers so that
only Securities in denominations of $1,000 or integral multiples of $1,000
shall be acquired);
(8) that Holders whose Securities were purchased only in
part will be issued new Securities equal in principal amount to the
unpurchased portion of the Securities surrendered; and
(9) the circumstances and relevant facts regarding such
Asset Sales.
The Issuers agree that any Asset Sale Offer shall be made in
compliance with all applicable laws, rules, and regulations, including, if
applicable, Regulation 14E of the Exchange Act and the rules and regulations
thereunder and all other applicable Federal and state securities laws, and any
provisions of this Indenture which conflict with such laws shall be deemed to be
superseded by the provisions of such laws.
On or before the date of purchase, the Issuers shall (i) accept for
payment Securities or portions thereof properly tendered pursuant to the Asset
Sale Offer (on a PRO RATA basis if required pursuant to paragraph (7) above),
(ii) deposit with the Paying Agent Cash sufficient to pay the Asset Sale Offer
Price for all Securities or portions thereof so accepted and (iii) deliver to
the Trustee Securities so accepted together with an Officers' Certificate
setting forth the Securities or portions thereof being purchased by the Issuers.
The Paying Agent shall promptly mail or deliver to Holders of Securities so
accepted payment in an amount equal to the Asset Sale Offer Price for such
Securities, and the Trustee shall promptly authenticate and mail or deliver to
such Holders a new Security equal in principal amount to any unpurchased portion
of the Security surrendered. Any Securities not so accepted shall be promptly
mailed or delivered by the Issuers to the Holder thereof.
sECTION 4.14 LIMITATION ON LAYERING INDEBTEDNESS.
The Issuers and the Guarantors, if any, will not, individually or
collectively, directly or indirectly, incur, or suffer to exist any Indebtedness
that is subordinate in right of payment to any other Indebtedness of either
Issuer or any Guarantor unless, by its terms, such Indebtedness is subordinate
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in right of payment to, or ranks PARI PASSU with, the Securities or the
Guarantee, if any, as applicable.
Section 4.15 LIMITATION ON LINES OF BUSINESS.
None of the Issuers or any of their Subsidiaries shall directly or
indirectly engage to any substantial extent in any line or lines of business
activity other than that which, in the good faith judgment of the Board of
Directors of Sun International, is a Related Business.
Section 4.16 LIMITATION ON STATUS AS INVESTMENT COMPANY.
None of Sun International or any of its Subsidiaries shall become
required to be registered as an "investment company" (as that term is defined in
the Investment Company Act of 1940, as amended), or otherwise become subject to
regulation under the Investment Company Act.
Section 4.17 FUTURE SUBSIDIARY GUARANTORS.
The Issuers covenant and agree that, if any Guarantees are
outstanding, they shall cause each person that becomes a Subsidiary of either
Issuer to execute a Guarantee in the form of each Guarantee outstanding and
shall cause such Subsidiary to enter into a supplemental indenture for the
purpose of jointly and severally guaranteeing, irrevocably and unconditionally,
on a senior subordinated basis, the Issuers' obligations to pay principal,
premium and interest on the Securities.
Section 4.18 PAYMENT FOR CONSENT.
None of the Issuers or any of their Subsidiaries or Unrestricted
Subsidiaries shall, directly or indirectly, pay or cause to be paid any
consideration, whether by way of interest, fee or otherwise, to any Holder of
any Securities for, or as an inducement to, any consent, waiver or amendment of
any of the terms or provisions of the Indenture or the Securities unless such
consideration is offered to be paid or agreed to be paid to all Holders of the
Securities which so consent, waive or agree to amend in the time frame set forth
in the solicitation documents relating to such consent, waiver or agreement,
which solicitation documents must be mailed to all Holders of the Securities
prior to the expiration of the solicitation.
Section 4.19 SUSPENDED COVENANTS.
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During any period of time that (i) the Securities have Investment
Grade Status and (ii) no Default or Event of Default has occurred and is
continuing under the Indenture with respect to the Securities, the Issuers and
their Subsidiaries will not be subject to Section 4.3, 4.10 or 4.13, in each
case, to the extent applicable (collectively, the "Suspended Covenants"). In
the event that the Issuers and their Subsidiaries are not subject to the
Suspended Covenants with respect to the Securities for any period of time as a
result of the preceding sentence and, subsequently, either of the Rating
Agencies withdraws its rating or assigns the Securities a rating below the
required Investment Grade Ratings, then the Issuers and their Subsidiaries will
thereafter again be subject to the Suspended Covenants for the benefit of the
Securities and compliance with Section 4.3 made after the time of such
withdrawal or assignment will be calculated in accordance with the terms of
Section 4.3 as if such covenant had been in effect during the entire period of
time from the Issue Date with respect to the Securities.
Section 4.20 PAYMENT OF ADDITIONAL AMOUNTS.
The Issuers will, subject to the limitations and exceptions set forth
below, pay to each Holder such amounts (the "Additional Amounts") as may be
necessary in order that every net payment or deemed payment of (i) principal,
premium and interest, if any, with respect to a Security, or (ii) net proceeds
on the sale or exchange of a Security, each after deduction or withholding for
or on account of any taxes, duties, assessments or governmental charges of
whatever nature imposed or levied by or on behalf of the government of The
Bahamas or any authority thereof or therein having power to tax, will result in
the receipt by the Holders of the amounts that would have been received by them
had no such deduction or withholding been required; PROVIDED, HOWEVER, that no
such Additional Amounts shall be payable in respect of any Security for:
(1) any tax, duty, assessment, or other governmental charge which
would not have been imposed but for the fact that such Holder:
(a) is a resident, domiciliary or national of, or engaged
in business or maintains a permanent establishment or was physically
present in, The Bahamas or any political subdivision thereof or therein or
otherwise has some connection with The Bahamas other than the mere
ownership of, or receipt of payment under, such Security;
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(b) presented such Security for payment in The Bahamas or
any political subdivision thereof or therein, unless such Security could
not have been presented for payment elsewhere; or
(c) presented such Security for payment more than 30 days
after the date on which the payment in respect of such Security became due
and payable or provided for, whichever is later, except to the extent that
the Holder would have been entitled to such Additional Amounts if it had
presented such Security for payment on any day within such period of 30
days;
(2) any estate, inheritance, gift, sales, transfer, or similar tax,
assessment or other governmental charge or any taxes, duties, assessments or
other governmental charges that are payable otherwise than by deduction or
withholding from payments on the Security;
(3) any tax, duty, assessment, or other governmental charge imposed
on a Holder that is not the beneficial owner of a Security to the extent that
the beneficial owner would not have been entitled to the payment of Additional
Amounts had the beneficial owner directly held the Security; or
(4) any combination of items (1), (2) and (3).
Whenever there is mentioned herein in any context, the payment of the
principal of or any premium or interest on, or in respect of, any Security or
the net proceeds received on the sale or exchange of any Security, such mention
shall be deemed to include mention of the payment of Additional Amounts provided
for in the Indenture to the extent that, in such context, Additional Amounts
are, were or would be payable in respect thereof pursuant to the Indenture.
Without limiting a Holder's right to receive payment of Additional
Amounts, in the event that Additional Amounts actually paid with respect to the
Securities are based on rates of deduction or withholding of Bahamian taxes in
excess of the appropriate rate applicable to the Holder of such Securities and,
as a result thereof, such Holder of Securities is entitled to make a claim for a
refund or credit of such excess, then such Holder of Securities shall, by
accepting the Securities and receiving a payment of Additional Amounts, be
deemed to have assigned and transferred all right, title and interest to any
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such claim for a refund or credit of such excess to the Issuers. By making such
assignment, the Holder of Securities makes no representation or warranty that
the Issuers will be entitled to receive such claim for a refund or credit and
incurs no other obligation with respect thereto.
Section 4.21 CALCULATION OF ORIGINAL ISSUE DISCOUNT.
The Issuers shall file with the Trustee promptly at the end of each
calendar year (i) a written notice specifying the amount of original issue
discount (including daily rates and accrual periods) accrued on outstanding
Securities as of the end of such year and (ii) such other specific information
relating to such original issue discount as may then be relevant under the
Internal Revenue Code of 1986, as amended from time to time.
ARTICLE V
SUCCESSOR CORPORATION
Any or all of the provisions of this Article V shall be applicable to
the Securities of any series for which such provision or provisions are
designated as applicable pursuant to the terms of Section 2.3. In addition, it
shall be established prior to the issuance of any series of Securities, pursuant
to Section 2.3, whether any successor provision other than or in addition to
those specified below shall be applicable to such series. Provisions of this
Article V not designated, pursuant to Section 2.3, as applying to a particular
series of Securities shall have no force and effect as to the Securities of such
series.
Section 5.1 LIMITATION ON MERGER, SALE OR CONSOLIDATION.
With respect to a series of Securities, neither of the Issuers will,
directly or indirectly, consolidate with or merge with or into another person or
sell, lease, convey or transfer all or substantially all of its assets (computed
as to each Issuer on a consolidated basis), whether in a single transaction or a
series of related transactions, to another person or group of affiliated persons
or adopt a Plan of Liquidation, unless (i) either (a) Sun International or SINA,
as applicable, is the resulting surviving or transferee entity (the "Successor
Company") or (b) the Successor Company or, in the case of a Plan of Liquidation,
the entity which receives the greatest value from
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such Plan of Liquidation is a corporation organized under the laws of the
Commonwealth of The Bahamas (in the case of Sun International only) or the
United States, any state thereof or the District of Columbia and expressly
assumes by supplemental indenture all of the obligations of Sun International or
SINA, as applicable, in connection with such series of Securities and the
Indenture; (ii) no Default or Event of Default with respect to such series of
Securities shall exist or shall occur immediately after giving effect on a pro
forma basis to such transaction; and (iii) immediately after giving effect to
such transaction on a pro forma basis, the Consolidated Net Worth of the
Successor Company or, in the case of a Plan of Liquidation, the entity which
receives the greatest value from such Plan of Liquidation is at least equal to
the Consolidated Net Worth of Sun International or SINA, as applicable,
immediately prior to such transaction; and (iv) immediately after giving effect
to such transaction on a pro forma basis, the Successor Company or, in the case
of a Plan of Liquidation, the entity which receives the greatest value from such
Plan of Liquidation would immediately thereafter be permitted to incur at least
$1.00 of additional Indebtedness pursuant to the Debt Incurrence Ratio set forth
in Section 4.10, to the extent applicable to such series of Securities.
With respect to a series of Securities, on or prior to the
consummation of the proposed transaction, the Issuers shall have delivered to
the Trustee an Officers' Certificate and an Opinion of Counsel, each stating
that such consolidation, merger, sale, assignment, conveyance, transfer, lease
or disposition and such supplemental indenture executed in connection therewith
comply with this Indenture. The Trustee shall be entitled to conclusively rely
upon such Officers' Certificate and Opinion of Counsel.
For purposes of the foregoing, the transfer (by lease, assignment,
sale or otherwise) of all or substantially all of the properties and assets of
one or more Subsidiaries, the interest of Sun International or SINA, as
applicable, in which constitutes all or substantially all of the properties and
assets of Sun International or SINA, as applicable, shall be deemed to be the
transfer of all or substantially all of the properties and assets of Sun
International, or SINA, as applicable.
Section 5.2 SUCCESSOR CORPORATION SUBSTITUTED.
With respect to a series of Securities, upon any consolidation or
merger or any transfer of all or substantially
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all of the assets of Sun International or SINA, as applicable, or consummation
of a Plan of Liquidation in accordance with the foregoing, the successor
corporation formed by such consolidation or into which Sun International or SINA
is merged or to which such transfer is made or, in the case of a Plan of
Liquidation, the entity which receives the greatest value from such Plan of
Liquidation shall succeed to, and be substituted for, and may exercise every
right and power of, Sun International or SINA, as applicable, under the
Indenture with the same effect as if such successor corporation had been named
therein as Sun International or SINA, as applicable, and Sun International or
SINA, as applicable, shall be released from the obligations under such series of
Securities and the Indenture except with respect to any obligations that arise
from, or are related to, such transaction.
ARTICLE VI
EVENTS OF DEFAULT AND REMEDIES
Any or all of the provisions of this Article VI shall be applicable to
the Securities of any series for which such provision or provisions are
designated as applicable pursuant to the terms of Section 2.3. In addition, it
shall be established prior to the issuance of any series of Securities, pursuant
to Section 2.3, whether any default or event of default other than or in
addition to those specified below shall be applicable to such series.
Provisions of this Article VI not designated, pursuant to Section 2.3, as
applying to a particular series of Securities shall have no force and effect as
to the Securities of such series.
Section 6.1 EVENTS OF DEFAULT.
"Event of Default", wherever used herein, means, with respect to a
series of Securities, any one of the following events (whatever the reason for
such Event of Default and whether it shall be caused voluntarily or
involuntarily or effected, without limitation, by operation of law or pursuant
to any judgment, decree or order of any court or any order, rule or regulation
of any administrative or governmental body):
(1) the failure by the Issuers to pay any installment of
interest on such series of Securities as and when the same becomes due and
payable and the continuance of any such failure for 30 days;
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(2) the failure by the Issuers to pay all or any part of
the principal, or premium, if any, on such series of Securities when and as
the same becomes due and payable at maturity, redemption, by acceleration
or otherwise, whether or not prohibited by the subordination provisions of
the Indenture, including, without limitation, payment of the Change of
Control Purchase Price or the Asset Sale Offer Price, or otherwise;
(3) the failure by either of the Issuers or any of their
Subsidiaries otherwise to comply with Section 4.13 and Articles V and X (to
the extent applicable to such series of Securities);
(4) (A) failure by either of the Issuers or any of their
Subsidiaries to observe or perform any other covenant or agreement
contained in Article IV (to the extent applicable to such series of
Securities and except as provided in clauses (1), (2) and (3) above) and
the continuance of such failure for a period of 30 days after written
notice is given to the Issuers by the Trustee or to the Issuers and the
Trustee by the Holders of at least 25% in aggregate principal amount of
such series of Securities then outstanding, or (B) failure by either of the
Issuers or any of their Subsidiaries to observe or perform any other
covenant or agreement contained in such series of Securities or herein (to
the extent applicable to such series of Securities and except as provided
for in clauses (1), (2), (3) and (4)(A) above) and the continuance of such
failure for 60 days after written notice is given to the Issuers by the
Trustee or the Issuers and the Trustee by the Holders of at least 25% in
aggregate principal amount of such series of Securities then outstanding;
(5) a decree, judgment, or order by a court of competent
jurisdiction shall have been entered adjudicating either or both of the
Issuers or any of their Significant Subsidiaries as bankrupt or insolvent,
or approving as properly filed a petition seeking reorganization of either
or both of the Issuers or any of their Significant Subsidiaries under any
bankruptcy or similar law, and such decree or order shall have continued
undischarged and unstayed for a period of 60 consecutive days; or a decree
or order of
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a court of competent jurisdiction, judgment appointing a receiver,
liquidator, trustee, or assignee in bankruptcy or insolvency for either or
both of the Issuers, any of their Significant Subsidiaries, or any
substantial part of the property of any such person, or for the winding up
or liquidation of the affairs of any such person, shall have been entered,
and such decree, judgment, or order shall have remained in force
undischarged and unstayed for a period of 60 days;
(6) either or both of the Issuers or any of their
Significant Subsidiaries shall institute proceedings to be adjudicated a
voluntary bankrupt, or shall consent to the filing of a bankruptcy
proceeding against it, or shall file a petition or answer or consent
seeking reorganization under any bankruptcy or similar law or similar
statute, or shall consent to the filing of any such petition, or shall
consent to the appointment of a Custodian, receiver, liquidator, trustee,
or assignee in bankruptcy or insolvency of it or any substantial part of
its assets or property, or shall make a general assignment for the benefit
of creditors, or shall admit in writing its inability to pay its debts as
they become due;
(7) if such series so provides, a default in Indebtedness
of either of the Issuers or any of their Subsidiaries with an aggregate
principal amount in excess of $10 million (a) resulting from the failure to
pay any principal at final stated maturity or (b) as a result of which the
maturity of such Indebtedness has been accelerated prior to its stated
maturity;
(8) if such series so provides, final unsatisfied judgments
not covered by insurance aggregating in excess of $10 million, at any one
time rendered against either of the Issuers or any of their Subsidiaries
and either (a) the commencement by any creditor of any enforcement
proceeding upon any such judgment that is not promptly stayed or (b) such
judgment is not stayed, bonded or discharged within 60 days; and
(9) any other Event of Default provided under the terms of
such series of Securities pursuant to Section 2.3.
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Section 6.2 ACCELERATION OF MATURITY DATE; RESCISSION AND
ANNULMENT.
If an Event of Default occurs and is continuing with respect to a
series of Securities (other than an Event of Default specified in clauses (5)
and (6), above, relating to either of the Issuers or any of their Significant
Subsidiaries), then in every such case, unless the principal of all Securities
of such series shall have already become due and payable, either the Trustee or
the Holders of 25% in aggregate principal amount of such series of Securities
then outstanding, by notice in writing to the Issuers (and to the Trustee if
given by Holders) (an "Acceleration Notice"), may declare all principal and
premium, if any, determined as set forth below, and accrued and unpaid interest
thereon to be due and payable immediately; provided, however, that if any Senior
Debt is outstanding pursuant to the Credit Agreement, such acceleration shall
not be effective until the earlier of (x) the fifth Business Day after the
giving to Sun International and the Representative of such written notice,
unless such Event of Default is cured or waived prior to such date and (y) the
date of acceleration of any Senior Debt under the Credit Agreement. If an Event
of Default specified in clauses (5) and (6) above relating to either of the
Issuers or any of their Significant Subsidiaries occurs with respect to a series
of Securities, all principal and accrued interest thereon will be immediately
due and payable on all outstanding Securities of such series without any
declaration or other act on the part of Trustee or the Holders thereof.
With respect to a series of Securities, at any time after such a
declaration of acceleration being made and before a judgment or decree for
payment of the money due has been obtained by the Trustee as hereinafter
provided in this Article VI, the Holders of a majority in aggregate principal
amount of then outstanding Securities of such series, by written notice to the
Issuers and the Trustee, may rescind, on behalf of all Holders of such series,
any such declaration of acceleration if:
(1) the Issuers have paid or deposited with the Trustee a
sum sufficient to pay
(A) all overdue interest on all Securities of
such series,
(B) the principal of (and premium, if any,
applicable to) any
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Securities of such series which would become due otherwise than by
such declaration of acceleration, and interest thereon at the rate
borne by the Securities of such series,
(C) to the extent that payment of such interest
is lawful, interest upon overdue interest at the rate borne by the
Securities of such series,
(D) all sums paid or advanced by the Trustee
hereunder and the compensation, expenses, disbursements and advances
of the Trustee, its agents and counsel, and
(2) all Events of Default with respect to such series of
Securities, other than the nonpayment of amounts which have become due
solely by such declaration of acceleration, have been cured or waived as
provided in Section 6.12.
Notwithstanding the previous sentence of this Section 6.2, with respect to a
series of Securities, no waiver shall be effective for any Event of Default with
respect to such series of Securities, or event which with notice or lapse of
time or both would be an Event of Default, with respect to such series of
Securities, with respect to any covenant or provision which cannot be modified
or amended without the consent of the Holder of each outstanding Security of
such series, unless all such affected Holders agree, in writing, to waive such
Event of Default or other event with respect to such series of Securities. No
such waiver shall cure or waive any subsequent default or impair any right
consequent thereon.
Section 6.3 COLLECTION OF INDEBTEDNESS AND SUITS FOR ENFORCEMENT BY
TRUSTEE.
The Issuers covenant that, with respect to a series of Securities, if
an Event of Default in payment of principal, premium, or interest specified in
Section 6.1(1) or (2) occurs and is continuing with respect to such series of
Securities, the Issuers shall, upon demand of the Trustee, pay to it, for the
benefit of the Holders of such series of Securities, the whole amount then due
and payable on such series of Securities for principal, premium (if any) and
interest and, to the extent that payment of such interest shall be legally
enforceable, interest
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on any overdue principal (and premium, if any) and on any overdue interest, at
the rate borne by such series of Securities, and, in addition thereto, such
further amount as shall be sufficient to cover the costs and expenses of
collection, including compensation to, and expenses, disbursements and advances
of the Trustee, its agents and counsel.
If the Issuers fail to pay such amounts forthwith upon such demand,
the Trustee, in its own name and as trustee of an express trust in favor of the
Holders of such series of Securities, may institute a judicial proceeding for
the collection of the sums so due and unpaid, may prosecute such proceeding to
judgment or final decree and may enforce the same against the Issuers or any
other obligor upon such series of Securities and collect the moneys adjudged or
decreed to be payable in the manner provided by law out of the property of the
Issuers or any other obligor upon such series of Securities, wherever situated.
If an Event of Default occurs and is continuing with respect to a
series of Securities, the Trustee may in its discretion proceed to protect and
enforce its rights and the rights of the Holders of such series of Securities by
such appropriate judicial proceedings as the Trustee shall deem most effective
to protect and enforce any such rights, whether for the specific enforcement of
any covenant or agreement in this Indenture or in aid of the exercise of any
power granted herein, or to enforce any other proper remedy.
Section 6.4 TRUSTEE MAY FILE PROOFS OF CLAIM.
In case of the pendency of any receivership, insolvency, liquidation,
bankruptcy, reorganization, arrangement, adjustment, composition or other
judicial proceeding relative to the Issuers or any other obligor upon any series
of Securities or the property of the Issuers or of such other obligor or their
creditors, the Trustee (irrespective of whether the principal of such series of
Securities shall then be due and payable as therein expressed or by declaration
or otherwise and irrespective of whether the Trustee shall have made any demand
on the Issuers for the payment of overdue principal or interest) shall be
entitled and empowered, by intervention in such proceeding or otherwise to take
any and all actions under the TIA, including
(i) to file and prove a claim for the whole amount of
principal (and premium, if any) and interest owing and unpaid in respect of
such series of
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Securities and to file such 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 agent and counsel) and of the Holders of such series of
Securities allowed in such judicial proceeding, and
(ii) to collect and receive any moneys or other property
payable or deliverable on any such claims and to distribute the same;
and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such judicial proceeding is hereby authorized by
each Holder of such series of Securities 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 of such series, to pay to the Trustee any amount due it
for the reasonable compensation, expenses, disbursements and advances of the
Trustee, its agents and counsel, and any other amounts due the Trustee under
Section 7.7.
Nothing herein contained shall be deemed to authorize the Trustee of
any series of Securities to authorize or consent to or accept or adopt on behalf
of any Holder of such series of Securities any plan of reorganization,
arrangement, adjustment, or composition affecting such series of Securities or
the rights of any Holder thereof or to authorize such Trustee to vote in respect
of the claim of any such Holder in any such proceeding.
Section 6.5 TRUSTEE MAY ENFORCE CLAIMS WITHOUT POSSESSION OF
SECURITIES.
All rights of action and claims under this Indenture or any series of
Securities may be prosecuted and enforced by the Trustee without the possession
of any of the Securities of such series or the production thereof in any
proceeding relating thereto, and any such proceeding instituted by the Trustee
shall be brought in its own name as trustee of an express trust in favor of the
Holders of such series, and any recovery of judgment shall, after provision for
the payment of compensation to, and expenses, disbursements and advances of the
Trustee, its agents and counsel, be for the ratable benefit of the Holders of
the Securities of such series in respect of which such judgment has been
recovered.
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Section 6.6 PRIORITIES.
Subject to Article XII, any money collected by the Trustee with
respect to a series of Securities pursuant to this Article VI shall be applied
in the following order, at the date or dates fixed by such Trustee and, in case
of the distribution of such money on account of principal, premium (if any) or
interest, upon presentation of the Securities of such series and the notation
thereon of the payment if only partially paid and upon surrender thereof if
fully paid:
FIRST: To such Trustee in payment of all amounts due pursuant to
Section 7.7;
SECOND: To the Holders of such series of Securities in payment of the
amounts then due and unpaid for principal of, premium (if any) and interest on,
the Securities of such series in respect of which or for the benefit of which
such money has been collected, ratably, without preference or priority of any
kind, according to the amounts due and payable on such Securities for principal,
premium (if any) and interest, respectively; and
THIRD: To whomsoever may be lawfully entitled thereto, the remainder,
if any.
Section 6.7 LIMITATION ON SUITS.
No Holder of any Security of any series shall have any right to order
or direct the Trustee to institute any proceeding, judicial or otherwise, with
respect to this Indenture, or for the appointment of a receiver or trustee, or
for any other remedy hereunder, unless
(A) such Holder has previously given written notice to
the Trustee of a continuing Event of Default with respect to such
series of Securities;
(B) the Holders of not less than 25% in principal
amount of then outstanding Securities of such series shall have made
written request to the Trustee to institute proceedings in respect of
such Event of Default in its own name as Trustee hereunder;
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(C) such Holder or Holders have offered to the Trustee
reasonable security or indemnity against the costs, expenses and
liabilities to be incurred or reasonably probable to be incurred in
compliance with such request;
(D) the Trustee for 60 days after its receipt of such
notice, request and offer of indemnity has failed to institute any
such proceeding; and
(E) no direction inconsistent with such written
request has been given to the Trustee during such 60-day period by the
Holders of a majority in principal amount of the outstanding
Securities of such series;
it being understood and intended that no one or more Holders of such series of
Securities shall have any right in any manner whatever by virtue of, or by
availing of, any provision of this Indenture to affect, disturb or prejudice the
rights of any other Holders of such series, or to obtain or to seek to obtain
priority or preference over any other such Holders or to enforce any right under
this Indenture, except in the manner herein provided and for the equal and
ratable benefit of all such Holders.
Section 6.8 UNCONDITIONAL RIGHT OF HOLDERS TO RECEIVE PRINCIPAL,
PREMIUM AND INTEREST.
Notwithstanding any other provision of this Indenture, the Holder of
any Security of any series shall have the right, which is absolute and
unconditional, to receive payment of the principal of, and premium (if any) and
interest on, such Security of such series on the Maturity Dates or Interest
Payment Dates, as applicable, of such payments as expressed in such Security of
such series (in the case of redemption, the Redemption Price on the Redemption
Date; in the case of a Change of Control, the Change of Control Purchase Price,
on the Change of Control Purchase Date; and in the case of an Asset Sale, the
Asset Sale Offer Price on the relevant purchase date); and to institute suit for
the enforcement of any such payment, and such rights shall not be impaired
without the consent of such Holder.
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Section 6.9 RIGHTS AND REMEDIES CUMULATIVE.
Except as otherwise provided with respect to the replacement or
payment of mutilated, destroyed, lost or stolen Securities in Section 2.7, no
right or remedy herein conferred upon or reserved to the Trustee or to the
Holders of any series is intended to be exclusive of any other right or remedy,
and every right and remedy shall, to the extent permitted by law, be cumulative
and in addition to every other right and remedy given hereunder or now or
hereafter existing at law or in equity or otherwise. The assertion or
employment of any right or remedy hereunder, or otherwise, shall not prevent the
concurrent assertion or employment of any other appropriate right or remedy.
Section 6.10 DELAY OR OMISSION NOT WAIVER.
No delay or omission by the Trustee or by any Holder of any series of
Securities to exercise any right or remedy arising upon any Event of Default
with respect to such series of Securities shall impair the exercise of any such
right or remedy or constitute a waiver of any such Event of Default. Every
right and remedy given by this Article VI or by law to the Trustee or to the
Holders of such series may be exercised from time to time, and as often as may
be deemed expedient, by the Trustee or by such Holders, as the case may be.
Section 6.11 CONTROL BY HOLDERS.
The Holder or Holders of a majority in aggregate principal amount of
then outstanding Securities of any series shall have the right to direct the
time, method and place of conducting any proceeding for any remedy available to
the Trustee or exercising any trust or power conferred upon the Trustee;
PROVIDED that
(1) such direction shall not be in conflict with any rule
of law or with this Indenture,
(2) the Trustee shall not determine that the action so
directed would be unjustly prejudicial to the Holders of such series of
Securities not taking part in such direction, and
(3) the Trustee may take any other action deemed proper by
the Trustee which is not inconsistent with such direction.
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Section 6.12 WAIVER OF PAST DEFAULT.
Subject to Section 6.8, the Holder or Holders of not less than a
majority in aggregate principal amount of the outstanding Securities of any
series may, by written notice to the Trustee on behalf of all Holders of such
series of Securities, prior to the declaration of the maturity of the Securities
of such series, waive any past default hereunder and its consequences, except a
default
(A) in the payment of the principal of, premium, if
any, or interest on, any Security of such series as specified in
clauses (1) and (2) of Section 6.1, or
(B) in respect of a covenant or provision hereof which
applies to such series of Securities and which, under Article IX,
cannot be modified or amended without the consent of the Holders of
each outstanding Security of such series affected.
Upon any such waiver, such default shall cease to exist, and any Event
of Default with respect to such series of Securities 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 the exercise of
any right arising therefrom.
Section 6.13 UNDERTAKING FOR COSTS.
All parties to this Indenture agree, and each Holder of any Security
of any series by his acceptance thereof shall be deemed to have agreed, that any
court may in its discretion require, in any suit for the enforcement of any
right or remedy under this Indenture, or in any suit against the Trustee for
such series for any action taken, suffered or omitted to be taken by it as
Trustee, the filing by any party litigant in such suit of an undertaking to pay
the costs of such suit, and that such court may in its discretion assess
reasonable costs, including reasonable attorneys' fees and expenses, against any
party litigant in such suit, having due regard to the merits and good faith of
the claims or defenses made by such party litigant; but the provisions of this
Section 6.13 shall not apply to any suit instituted by the Issuers, to any suit
instituted by the Trustee, to any suit instituted by any Holder, or group of
Holders,
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holding in the aggregate more than 10% in aggregate principal amount of the
outstanding Securities of such series, or to any suit instituted by any Holder
for enforcement of the payment of principal of, or premium (if any) or interest
on, any Security of such series on or after the Maturity Date of such Security.
Section 6.14 RESTORATION OF RIGHTS AND REMEDIES.
If the Trustee or any Holder of any series of Securities has
instituted any proceeding to enforce any right or remedy under this Indenture
and such proceeding has been discontinued or abandoned for any reason, or has
been determined adversely to such Trustee or to such Holder, then and in every
case, subject to any determination in such proceeding, the Issuers, the
Guarantors, if any, such Trustee and such Holder or Holders shall be restored
severally and respectively to their former positions hereunder and thereafter
all rights and remedies of such Trustee and such Holder or Holders shall
continue as though no such proceeding had been instituted.
ARTICLE VII
TRUSTEE
The Trustee hereby accepts the trust imposed upon it by this Indenture
and covenants and agrees to perform the same, as herein expressed.
Section 7.1 DUTIES OF TRUSTEE.
(a) If a Default or an Event of Default has occurred and is
continuing with respect to any series of Securities, 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 or
use under the circumstances in the conduct of his own affairs.
(b) Except during the continuance of a Default or an Event of
Default with respect to any series of Securities:
(1) The Trustee with respect to such series need
perform only those duties as are specifically set forth in this Indenture
and no others, and no covenants or obligations shall be implied in or
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read into this Indenture which are adverse to the Trustee.
(2) In the absence of bad faith on its part, the
Trustee may conclusively rely, as to the truth of the statements and the
correctness of the opinions expressed therein, upon certificates or
opinions furnished to the Trustee and conforming to the requirements of
this Indenture. However, in the case of any such certificates or opinions
which by any provision hereof are specifically required to be furnished to
the Trustee, the Trustee shall examine the certificates and opinions to
determine whether or not they conform to the requirements of this
Indenture.
(c) The Trustee may not be relieved from liability for its own
negligent action, its own negligent failure to act, or its own willful
misconduct, except that:
(i) This paragraph does not limit the effect of subsection
(b) of this Section 7.1.
(ii) The Trustee shall not be liable for any error of
judgment made in good faith by a Trust Officer, unless it is proved that
the Trustee was grossly negligent in ascertaining the pertinent facts.
(iii) The Trustee shall not be liable with respect to any
action it takes or omits to take in good faith in accordance with a
direction received by it pursuant to Section 6.12.
(d) The Trustee shall comply with any order or directive of a
Gaming Authority that the Trustee submit, at the expense of the Issuers, an
application for any license, finding of suitability or other approval pursuant
to any gaming law and will cooperate fully and completely in any proceeding
related to such application; provided, however, that in the event the Trustee in
its reasonable judgment determines that complying with such order or directive
would subject it or its officers or directors to unreasonable or onerous
requirements, the Trustee may, at its option, resign as Trustee in lieu of
complying with such order or directive; and provided, further, that no
resignation shall become effective until a successor Trustee is appointed and
delivers a written acceptance in accordance with Section 7.8 hereof.
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(e) 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 to take or omit to take any action
under this Indenture or at the request, order or direction of the Holders 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.
(f) Every provision of this Indenture that in any way relates to
the Trustee is subject to subsections (a), (b), (c), (d) and (e) of this Section
7.1.
(g) The Trustee shall not be liable for interest on any assets
received by it except as the Trustee may agree in writing with the Issuers.
Assets held in trust by the Trustee need not be segregated from other assets
except to the extent required by law.
Section 7.2 RIGHTS OF TRUSTEE.
Subject to Section 7.1:
(a) The Trustee may conclusively rely on any document believed
by it to be genuine and to have been signed or presented by the proper person.
The Trustee need not investigate any fact or matter stated in the document.
(b) Before the Trustee acts or refrains from acting, it may
consult with counsel of its selection and may require an Officers' Certificate
or an Opinion of Counsel, which shall conform to Sections 13.4 and 13.5. The
Trustee shall not be liable for any action it takes or omits to take in good
faith in reliance on such certificate or opinion.
(c) The Trustee may act through its attorneys and agents and
shall not be responsible for the misconduct or negligence of any agent appointed
with due care.
(d) The Trustee shall not be liable for any action it takes or
omits to take in good faith which it believes to be authorized or within its
rights or powers.
(e) The Trustee shall not be bound to make any investigation
into the facts or matters stated in any resolution, certificate, statement,
instrument, opinion, notice, request,
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direction, consent, order, bond, debenture, or other paper or document, but the
Trustee, in its discretion, may make such further inquiry or investigation into
such facts or matters as it may see fit.
(f) The Trustee shall be under no obligation to exercise any of
the rights or powers vested in it by this Indenture at the request, order or
direction of any of the Holders, pursuant to the provisions of this Indenture,
unless such Holders shall have offered to the Trustee reasonable security or
indemnity against the costs, expenses and liabilities which may be incurred
therein or thereby.
(g) Except with respect to Section 4.1, the Trustee shall have
no duty to inquire as to the performance of the Issuers' covenants in Article IV
hereof. In addition, the Trustee shall not be deemed to have knowledge of any
Default or Event of Default except (i) any Event of Default occurring pursuant
to Sections 6.1(1), 6.1(2) and 4.1, or (ii) any Default or Event of Default of
which the Trustee shall have received written notification or obtained actual
knowledge.
Section 7.3 INDIVIDUAL RIGHTS OF TRUSTEE.
The Trustee in its individual or any other capacity may become the
owner or pledgee of Securities of any series and may otherwise deal with the
Issuers, any Guarantor, any of their respective Subsidiaries, or their
respective Affiliates with the same rights it would have if it were not Trustee.
Any Agent may do the same with like rights. However, the Trustee must comply
with Sections 7.10 and 7.11.
Section 7.4 TRUSTEE'S DISCLAIMER.
The Trustee makes no representation as to the validity or adequacy of
this Indenture or the Securities and it shall not be accountable for the
Issuers' use of the proceeds from the Securities, and it shall not be
responsible for any statement in the Securities (other than the Trustee's
certificate of authentication) or for the use or application of any funds
received by a Paying Agent other than the Trustee.
Section 7.5 NOTICE OF DEFAULTS.
If a Default or an Event of Default with respect to any series of
Securities occurs and is continuing and if it is actually known to the Trustee
for such Securities, the Trustee
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shall mail to each Securityholder of such series notice of the uncured Default
or Event of Default within 90 days after such Default or Event of Default
occurs. Except in the case of a Default or an Event of Default in payment of
principal (or premium, if any) of, or interest on such series of Securities
(including the payment of the Change of Control Purchase Price on the Change of
Control Purchase Date, the Redemption Price on the Redemption Date, and the
Asset Sale Offer Price on the relevant purchase date), the Trustee may withhold
the notice if and so long as a Trust Officer in good faith determines that
withholding the notice is in the interest of the Securityholders of such series.
Section 7.6 REPORTS BY TRUSTEE TO HOLDERS.
If required by law, within 60 days after each January 31 beginning
with the January 31 following the date of this Indenture, the Trustee with
respect to each series of securities shall mail to each Securityholder of such
series a brief report dated as of such January 31 that complies with TIA Section
313(a). If required by law, the Trustee with respect to each series of
securities also shall comply with TIA Sections 313(b) and 313(c).
The Issuers shall promptly notify the Trustee in writing if the
Securities of any series become listed on any stock exchange or automatic
quotation system.
A copy of each report at the time of its mailing to Securityholders
shall be mailed to the Issuers and filed with the SEC and each stock exchange,
if any, on which the Securities are listed.
Section 7.7 COMPENSATION AND INDEMNITY.
The Issuers shall pay to the Trustee from time to time such
compensation as shall be agreed in writing between the Issuers and the Trustee
for its services. The Trustee's compensation shall not be limited by any law on
compensation of a trustee of an express trust. The Issuers shall reimburse the
Trustee upon request for all reasonable disbursements, expenses and advances
incurred or made by it. Such expenses shall include the reasonable
compensation, disbursements, fees and expenses of the Trustee's agents,
accountants, experts and counsel.
The Issuers shall indemnify the Trustee (in its capacity as Trustee,
Registrar and Paying Agent) and each of its officers, directors,
attorneys-in-fact and agents for, and hold it
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harmless against, any claims, loss, damage, demand, fee, expense (including but
not limited to reasonable compensation, disbursements and expenses of the
Trustee's agents and counsel), loss or liability incurred by them without
negligence or bad faith on its part, arising out of or in connection with the
acceptance or administration of this trust and their rights or duties hereunder
including the reasonable costs and expenses of defending themselves against any
claim or liability in connection with the exercise or performance of any of its
powers or duties hereunder. The Trustee shall notify the Issuers promptly of
any claim asserted against the Trustee for which it may seek indemnity. The
Issuers shall defend the claim and the Trustee shall provide reasonable
cooperation at the Issuers' expense in the defense. The Trustee may have
separate counsel and the Issuers shall pay the reasonable fees and expenses of
such counsel; PROVIDED that the Issuers will not be required to pay such fees
and expenses if they assume the Trustee's defense and there is no conflict of
interest between the Issuers and the Trustee in connection with such defense.
The Issuers need not pay for any settlement made without their written consent.
The Issuers need not reimburse any expense or indemnify against any loss or
liability to the extent incurred by the Trustee through its negligence, bad
faith or wilful misconduct.
To secure the Issuers' payment obligations in this Section 7.7, the
Trustee with respect to each series of Securities shall have a lien prior to the
Securities of such series on all assets held or collected by the Trustee, in its
capacity as Trustee, except assets held in trust to pay principal and premium,
if any, of or interest on particular Securities of such series.
When the Trustee incurs expenses or renders services after an Event of
Default specified in Section 6.1(5) or (6) occurs, the expenses and the
compensation for the services are intended to constitute expenses of
administration under any Bankruptcy Law.
The Issuers' obligations under this Section 7.7 and any lien arising
hereunder shall survive the resignation or removal of the Trustee, the discharge
of the Issuers' obligations pursuant to Article VIII of this Indenture and any
rejection or termination of this Indenture under any Bankruptcy Law.
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Section 7.8 REPLACEMENT OF TRUSTEE.
The Trustee with respect to any series of Securities may resign by so
notifying the Issuers in writing; PROVIDED, HOWEVER, that no such resignation
shall be effective until a successor Trustee with respect to such series has
accepted its appointment pursuant to this Section 7.8. The Holder or Holders of
a majority in principal amount of the outstanding Securities of any series may
remove Trustee for such series by so notifying the Issuers and such Trustee in
writing and may appoint a successor trustee with the Issuers' consent. The
Issuers may remove the Trustee with respect to any series of Securities if:
(1) the Trustee fails to comply with Section 7.10;
(2) the Trustee is adjudged bankrupt or insolvent;
(3) a receiver, Custodian, or other public officer takes
charge of the Trustee or its property; or
(4) the Trustee becomes incapable of acting.
If the Trustee resigns or is removed or if a vacancy exists in the
office of Trustee for any reason with respect to the Securities of one or more
series, the Issuers shall promptly appoint a successor Trustee with respect to
the Securities of that or those series (it being understood that any such
successor Trustee may be appointed with respect to the Securities of one or more
or all of such series and that at any time there shall be only one Trustee with
respect to the Securities of any series). Within one year after the successor
Trustee takes office, the Holder or Holders of a majority in principal amount of
the Securities of such series may appoint a successor Trustee to replace the
successor Trustee appointed by the Issuers.
A successor Trustee shall deliver a written acceptance of its
appointment to the retiring Trustee and to the Issuers. Immediately after that
and provided that all sums owing to the Trustee provided for in Section 7.7 have
been paid, the retiring Trustee shall transfer all property held by it as
Trustee to the successor Trustee, subject to the lien provided in Section 7.7,
the resignation or removal of the retiring Trustee shall become effective, and
the successor Trustee shall have all the rights,
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powers and duties of the Trustee under this Indenture. A successor Trustee of
any series of Securities shall mail notice of its succession to each Holder of
such series.
If a successor Trustee with respect to the Securities of such series
does not take office within 60 days after the retiring Trustee resigns or is
removed, the retiring Trustee, the Issuers or the Holder or Holders of at least
10% in principal amount of the outstanding Securities of such series may
petition any court of competent jurisdiction for the appointment of a successor
Trustee with respect to the Securities of such series.
If the Trustee fails to comply with Section 7.10, any Securityholder
of any series for which the Trustee acts in such capacity may petition any court
of competent jurisdiction for the removal of the Trustee and the appointment of
a successor Trustee.
Notwithstanding replacement of the Trustee pursuant to this Section
7.8, the Issuers' obligations under Section 7.7 shall continue for the benefit
of the retiring Trustee.
Section 7.9 SUCCESSOR TRUSTEE BY MERGER, ETC.
If the Trustee with respect to the Securities of any series
consolidates with, merges or converts into, or transfers all or substantially
all of its corporate trust business to, another corporation, the resulting,
surviving or transferee corporation without any further act shall, if such
resulting, surviving or transferee corporation is otherwise eligible hereunder,
be the successor Trustee with respect to the Securities of such series.
Section 7.10 ELIGIBILITY; DISQUALIFICATION.
The Trustee with respect to the securities of each series of
Securities shall at all times satisfy the requirements of TIA Section 310(a)(1)
and TIA Section 310(a)(5). The Trustee with respect to the securities of each
series of Securities shall have a combined capital and surplus of at least
$25,000,000 as set forth in its most recent published annual report of
condition. The Trustee with respect to the securities of each series of
Securities shall comply with TIA Section 310(b).
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Section 7.11 PREFERENTIAL COLLECTION OF CLAIMS AGAINST ISSUERS.
The Trustee with respect to the securities of each series of
Securities shall comply with TIA Section 311(a), excluding any creditor
relationship listed in TIA Section 311(b). A Trustee who has resigned or been
removed shall be subject to TIA Section 311(a) to the extent indicated.
ARTICLE VIII
LEGAL DEFEASANCE AND COVENANT DEFEASANCE
Section 8.1 OPTION TO EFFECT LEGAL DEFEASANCE OR COVENANT
DEFEASANCE.
The Issuers may, at their option, by Board Resolution, at any time,
elect to have Section 8.2 or Section 8.3 applied to all outstanding Securities
or all outstanding Securities of any series upon compliance with the conditions
set forth below in this Article VIII.
Section 8.2 LEGAL DEFEASANCE AND DISCHARGE.
Upon the Issuers' exercise under Section 8.1 of the option applicable
to this Section 8.2, the Issuers and the Guarantors, if any, shall be deemed to
have been discharged from their respective obligations with respect to all
outstanding Securities or all outstanding Securities of any series (the
"Defeased Securities") on the date the conditions set forth below are satisfied
(hereinafter, "Legal Defeasance"). For this purpose, such Legal Defeasance
means that the Issuers shall be deemed to have paid and discharged the entire
Indebtedness represented by the Defeased Securities, which shall thereafter be
deemed to be "outstanding" only for the purposes of Section 8.5 and the other
Sections of this Indenture referred to in (a) and (b) below, and to have
satisfied all their other obligations under such Defeased Securities and this
Indenture (and the Trustee for the Defeased Securities, on demand of and at the
expense of the Issuers, shall execute proper instruments acknowledging the
same), except for the following which shall survive until otherwise terminated
or discharged hereunder: (a) the rights of Holders of Defeased Securities to
receive solely from the trust fund described in Section 9.4, and as more fully
set forth in such section, payments in respect of the principal of,
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premium, if any, and interest on such Defeased Securities when such payments are
due, (b) the Issuers' obligations with respect to such Defeased Securities under
Sections 2.4, 2.6, 2.7, 2.10 and 4.2, (c) the rights, powers, trusts, duties and
immunities of the Trustee hereunder and the Issuers' obligations in connection
therewith and (d) this Article VIII. Subject to compliance with this Article
VIII, the Issuers may exercise their option under this Section 8.2 with respect
to any series of Securities notwithstanding the prior exercise of their option
under Section 8.3 with respect to such series of Securities.
Section 8.3 COVENANT DEFEASANCE.
Upon the Issuers' exercise under Section 8.1 of the option applicable
to this Section 8.3, the Issuers shall be released from their obligations under
the covenants contained in Sections 4.3, 4.6, 4.7, 4.9, 4.10, 4.11, 4.12, 4.13,
4.14, 4.15 and 4.16, Article V and Article X, in each case, to the extent
applicable, with respect to the Defeased Securities on and after the date the
conditions set forth below are satisfied (hereinafter, "Covenant Defeasance"),
and the Defeased Securities shall thereafter be deemed not "outstanding" for the
purposes of any direction, waiver, consent or declaration or act of Holders
thereof (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
Defeased Securities, the Issuers need not 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, but, except as specified
above, the remainder of this Indenture and such Defeased Securities shall be
unaffected thereby. In addition, upon the Issuers' exercise under Section 8.1
of the option applicable to this Section 8.3, Sections 6.1(3) through 6.1(8)
shall not constitute Events of Default with respect to the Defeased Securities.
Section 8.4 CONDITIONS TO LEGAL OR COVENANT DEFEASANCE.
The following shall be the conditions to the application of either
Section 8.2 or Section 8.3 to the outstanding Securities or any series thereof,
as the case may be:
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(a) The Issuers shall irrevocably have deposited or caused to be
deposited with the Trustee (or another trustee satisfying the requirements of
Section 7.10 who shall agree to comply with the provisions of this Article VIII
applicable to it) as trust funds in trust for the purpose of making the
following payments, specifically pledged as security for, and dedicated solely
to, the benefit of the Holders of such Securities, (a) Cash in an amount, or
(b) U.S. Government Obligations which through the scheduled payment of principal
and interest in respect thereof in accordance with their terms will provide, not
later than one day before the due date of any payment, Cash in an amount, or
(c) a combination thereof, in such amounts, as in each case will be sufficient,
in the opinion of a nationally recognized firm of independent public accountants
expressed in a written certification thereof delivered to the Trustee, to pay
and discharge the principal of, premium, if any, and interest on such Securities
on the stated maturity or on the applicable redemption date, as the case may be,
of such principal or installment of principal, premium, if any, or interest;
PROVIDED that the Trustee shall have been irrevocably instructed to apply such
funds to said payments with respect to such Securities.
(b) In the case of an election under Section 8.2, the Issuers
shall have delivered to the Trustee an Opinion of Counsel in the United States
reasonably satisfactory to the Trustee confirming that (i) the Issuers have
received from, or there has been published by, the Internal Revenue Service a
ruling or (ii) since the date hereof, there has been a change in the applicable
Federal income tax law, in either case to the effect that, and based thereon
such opinion shall confirm that, the Holders of such Securities will not
recognize income, gain or loss for Federal income tax purposes as a result of
such Legal Defeasance and will be subject to Federal income tax on the same
amounts, in the same manner and at the same times as would have been the case if
such Legal Defeasance has not occurred;
(c) In the case of an election under Section 8.3, the Issuers
shall have delivered to the Trustee an Opinion of Counsel in the United States
to the effect that the Holders of such Securities will not recognize income,
gain or loss for Federal income tax purposes as a result of such Covenant
Defeasance and will be subject to Federal income tax in the same amount, in the
same manner and at the same times as would have been the case if such Covenant
Defeasance had not occurred;
(d) No Default or Event of Default with respect to such
Securities shall have occurred and be continuing on the
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date of such deposit or, in so far as Section 7.1(5) or 7.1(6) is concerned, at
any time in the period ending on the 91st day after the date of such deposit (it
being understood that this condition shall not be deemed satisfied until the
expiration of such period);
(e) Such Legal Defeasance or Covenant Defeasance shall not
result in a breach or violation of, or constitute a default under, this
Indenture or any other material agreement or instrument to which either of the
Issuers or any of their Subsidiaries is a party or by which either of the
Issuers or any of their Subsidiaries is bound;
(f) In the case of an election under either Section 8.2 or 8.3,
the Issuers shall have delivered to the Trustee for the applicable series an
Officers' Certificate stating that the deposit made by the Issuers pursuant to
its election under Section 8.2 or 8.3 was not made by the Issuers with the
intent of preferring the Holders of such Securities over other creditors of the
Issuers or with the intent of defeating, hindering, delaying or defrauding
creditors of the Issuers or others;
(g) The Issuers shall have delivered to the Trustee an Officers'
Certificate and an Opinion of Counsel in the United States, each stating that
the conditions precedent provided for, in the case of the Officers' Certificate,
in subsections (a) through (f) of this Section 8.4 and, in the case of the
Opinion of Counsel, subsections (a) (with respect to the validity and perfection
of the security interest), (b), (c) and (e) of this Section 8.4 have been
complied with as contemplated by this Section 8.4.
Section 8.5 DEPOSITED CASH AND U.S. GOVERNMENT OBLIGATIONS TO BE
HELD IN TRUST; OTHER MISCELLANEOUS PROVISIONS.
Subject to Section 8.6, all Cash and U.S. Government Obligations
(including the proceeds thereof) deposited with the Trustee for the applicable
series of Securities (or other qualifying trustee, collectively for purposes of
this Section 8.5, the "Trustee") pursuant to Section 8.4 in respect of the
Defeased Securities shall be held in trust and applied by such Trustee, in
accordance with the provisions of such Defeased Securities and this Indenture,
to the payment, either directly or through any Paying Agent as the Trustee may
determine, to the Holders of such Defeased Securities of all sums due and to
become due thereon in respect of principal, premium, if any, and
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interest, but such money need not be segregated from other funds except to the
extent required by law.
The Issuers shall pay and indemnify such Trustee against any tax, fee
or other charge imposed on or assessed against the U.S. Government Obligations
deposited pursuant to Section 8.4 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 Defeased Securities.
Section 8.6 REPAYMENT TO ISSUERS.
Anything in this Article VIII to the contrary notwithstanding, the
Trustee shall deliver or pay to the Issuers from time to time upon the request
of the Issuers any funds or U.S. Government Obligations held by it as provided
in Section 8.4 which, in the opinion of a nationally recognized firm of
independent public accountants expressed in a written certification thereto
delivered to the Trustee (which may be the opinion delivered under Section
8.4(a)), are in excess of the amount thereof which would then be required to be
deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.
Any money deposited with the Trustee or any Paying Agent for any
Defeased Securities, or then held by the Issuers, in trust for the payment of
the principal of, premium, if any, or interest on any Defeased Securities and
remaining unclaimed for two years after such principal, and premium, if any, or
interest has become due and payable shall be paid to the Issuers on their
request; and the Holder of such Defeased Securities shall thereafter look only
to the Issuers for payment thereof, and all liability of the Trustee or such
Paying Agent with respect to such trust money 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 Issuers 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 Issuers.
Section 8.7 REINSTATEMENT.
If the Trustee or Paying Agent for any Defeased Securities is unable
to apply any funds or U.S. Government Obligations in accordance with Section 8.2
or 8.3, as the case
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may be, by reason of any order or judgment of any court or governmental
authority enjoining, restraining or otherwise prohibiting such application, then
the Issuers' obligations under this Indenture and the Defeased Securities shall
be revived and reinstated as though no deposit had occurred pursuant to Section
8.2 or 8.3 until such time as the Trustee or Paying Agent is permitted to apply
such money in accordance with Section 8.2 and 8.3, as the case may be; PROVIDED,
HOWEVER, that, if the Issuers make any payment of principal of, premium, if any,
or interest on any such Securities following the reinstatement of its
obligations, the Issuers shall be subrogated to the rights of the Holders of
such Securities to receive such payment from the Cash held by the Trustee or
Paying Agent.
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ARTICLE IX
AMENDMENTS, SUPPLEMENTS AND WAIVERS
Section 9.1 SUPPLEMENTAL INDENTURES WITHOUT CONSENT OF HOLDERS.
Without the consent of any Holder, the Issuers or any Guarantor when
authorized by Board Resolutions, and the Trustee, at any time and from time to
time, may enter into one or more indentures supplemental hereto, in form
satisfactory to the Trustee, for any of the following purposes:
(1) to cure any ambiguity, defect, or inconsistency, or to
make any other provisions with respect to matters or questions arising
under this Indenture which shall not be inconsistent with the provisions of
this Indenture, provided such action pursuant to this clause (1) shall not
adversely affect the interests of any Holder in any respect;
(2) to add to the covenants of the Issuers for the benefit
of the Holders of all the Securities or any series thereof, or to surrender
any right or power herein conferred upon the Issuers or to make any other
change that does not adversely affect the rights of any Holder; PROVIDED
that the Issuers have delivered to the Trustee an Opinion of Counsel
stating that such change does not adversely affect the rights of any
Holder;
(3) to provide for additional Guarantors of all the
Securities or any series thereof;
(4) to add to, change or eliminate any of the provisions of
this Indenture (which addition, change or elimination may apply to one or
more series of Securities), PROVIDED that any such addition, change or
elimination other than those permitted by all or any of clauses (1), (2),
(3), (5) and (6) of this Section 9.1 shall neither (a) apply to any
Security of any series created prior to the execution of such supplemental
indenture and entitled to the benefit of such provision nor (b) modify the
rights of the Holder of any such Security with respect to such provision;
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(5) to evidence the succession of another person to either
of the Issuers, and the assumption by any such successor of the obligations
of such Issuer, herein and in the Securities in accordance with Article V;
or
(6) to comply with the TIA.
Section 9.2 AMENDMENTS, SUPPLEMENTAL INDENTURES AND WAIVERS WITH
CONSENT OF HOLDERS.
Subject to Section 6.8 and the last sentence of this paragraph, with
the consent of the Holders of not less than a majority in aggregate principal
amount of a series of Securities then outstanding, by written act of said
Holders delivered to the Issuers and the Trustee for such series, the Issuers
and any Guarantor, when authorized by Board Resolutions, and such Trustee may
amend or supplement this Indenture with respect to such series or the Securities
of such series or enter into an indenture or indentures supplemental hereto for
the purpose of adding any provisions to or changing in any manner or eliminating
any of the provisions of this Indenture with respect to such series or the
Securities of such series or of modifying in any manner the rights of the
Holders of such series under this Indenture or under the Securities of such
series. Subject to Section 6.8 and the last sentence of this paragraph, the
Holder or Holders of a majority in principal amount of then outstanding
Securities of such series may waive compliance by the Issuers or any Guarantor,
with any provision of this Indenture with respect to such series or the
Securities of such series. Notwithstanding the foregoing provisions of this
Section 9.2, without the consent of each Holder affected thereby, no such
amendment, supplemental indenture or waiver shall:
(1) reduce the percentage of principal amount of Securities
of any series whose Holders must consent to an amendment, supplement or
waiver of any provision of this Indenture or the Securities of such series;
(2) reduce the rate or extend the time for payment of
interest on any Security;
(3) reduce the principal amount of any Security, or, in the
case of Securities subject to Article X or Section 4.13, reduce the Change
of Control
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Purchase Price or the Asset Sale Offer Price, respectively;
(4) change the Stated Maturity of any Security;
(5) in the case of Securities subject to the redemption
provisions of Article III, alter the redemption provisions of Article III
in a manner adverse to any Holder;
(6) make any changes in the provisions concerning waivers
of Defaults or Events of Default by Holders of the Securities (except to
increase any percentage of Securities required to consent to a waiver or to
provide that certain other provisions of the Indenture cannot be modified
or waived without the consent of the Holder of each outstanding Security
affected thereby) or the rights of Holders to recover the principal or
premium of, interest on, or redemption payment with respect to, any
Security;
(7) make any changes in Section 6.8, 6.12 or this third
sentence of this Section 9.2;
(8) make the principal of, or the interest on, any Security
payable with anything or at anywhere other than as provided for in this
Indenture and the Securities of the series concerned as in effect on the
date hereof; or
(9) make the Securities or Guarantees, if any, further
subordinated in right of payment to any extent or under any circumstances
to any other indebtedness.
It shall not be necessary for the consent of the Holders under this
Section to approve the particular form of any proposed amendment, supplement or
waiver, but it shall be sufficient if such consent approves the substance
thereof.
After an amendment, supplement or waiver under this Section becomes
effective, the Issuers shall mail to the Holders affected thereby a notice
briefly describing the amendment, supplement or waiver. Any failure of the
Issuers to mail such notice, or any defect therein, shall not, however, in any
way impair or affect the validity of any such supplemental indenture.
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After an amendment, supplement or waiver under this Section 9.2 or 9.4
becomes effective, it shall bind each Holder of the series of Securities
affected by such amendment, supplement or waiver.
In connection with any amendment, supplement or waiver under this
Article IX, the Issuers may, but shall not be obligated to, offer to any Holder
who consents to such amendment, supplement or waiver, or to all Holders,
consideration for such Holder's consent to such amendment, supplement or waiver.
Section 9.3 COMPLIANCE WITH TIA.
Every amendment, waiver or supplement of this Indenture or the
Securities shall comply with the TIA as then in effect.
Section 9.4 REVOCATION AND EFFECT OF CONSENTS.
Until an amendment, waiver or supplement becomes effective, a consent
to it by a Holder is a continuing consent by the Holder and every subsequent
Holder of a Security or portion of a Security that evidences the same debt as
the consenting Holder's Security, even if notation of the consent is not made on
any Security. However, any such Holder or subsequent Holder may revoke the
consent as to his Security or portion of his Security by written notice to the
Issuers or the person designated by the Issuers as the person to whom consents
should be sent if such revocation is received by the Issuers or such person
before the date on which the Trustee receives an Officers' Certificate
certifying that the Holders of the requisite principal amount of Securities have
consented (and not theretofore revoked such consent) to the amendment,
supplement or waiver.
The Issuers may, but shall not be obligated to, fix a record date for
the purpose of determining the Holders entitled to consent to any amendment,
supplement or waiver, which record date shall be the date so fixed by the
Issuers notwithstanding the provisions of the TIA. If a record date is fixed,
then notwithstanding the last sentence of the immediately preceding paragraph,
those persons who were Holders at such record date, and only those persons (or
their duly designated proxies), shall be entitled to revoke any consent
previously given, whether or not such persons continue to be Holders after such
record date. No such consent shall be valid or effective for more than 90 days
after such record date.
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After an amendment, supplement or waiver becomes effective, it shall
bind every Securityholder of the affected series, unless it makes a change
described in any of clauses (1) through (9) of Section 9.2, in which case, the
amendment, supplement or waiver shall bind only each Holder of a Security who
has consented to it and every subsequent Holder of a Security or portion of a
Security that evidences the same debt of the same series as the consenting
Holder's Security; PROVIDED that any such waiver shall not impair or affect the
right of any Holder to receive payment of principal and premium of and interest
on a Security, on or after the respective dates set for such amounts to become
due and payable expressed in such Security, or to bring suit for the enforcement
of any such payment on or after such respective dates.
Section 9.5 NOTATION ON OR EXCHANGE OF SECURITIES.
If an amendment, supplement or waiver changes the terms of a Security,
the Trustee may require the Holder of the Security to deliver it to the Trustee
or require the Holder to put an appropriate notation on the Security. The
Trustee may place an appropriate notation on the Security about the changed
terms and return it to the Holder. Alternatively, if the Issuers or the Trustee
so determines, the Issuers in exchange for the Security shall issue, the
Guarantors, if any, shall endorse and the Trustee shall authenticate a new
Security that reflects the changed terms. Any failure to make the appropriate
notation or to issue a new Security shall not affect the validity of such
amendment, supplement or waiver.
Section 9.6 TRUSTEE TO SIGN AMENDMENTS, ETC.
The Trustee shall execute any amendment, supplement or waiver
authorized pursuant to this Article IX PROVIDED that the Trustee may, but shall
not be obligated to, execute any such amendment, supplement or waiver which
affects the Trustee's own rights, duties or immunities under this Indenture.
The Trustee shall be entitled to receive, and shall be fully protected in
relying upon, an Officers' Certificate and Opinion of Counsel stating that the
execution of any amendment, supplement or waiver authorized pursuant to this
Article IX is authorized or permitted by this Indenture.
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ARTICLE X
RIGHT TO REQUIRE REPURCHASE
Any or all of the provisions of this Article X shall be applicable to
the Securities of any series for which such provision or provisions are
designated as applicable pursuant to the terms of Section 2.3. In addition, it
shall be established prior to the issuance of any series of Securities, pursuant
to Section 2.3, whether any right or rights other than or in addition to those
specified below shall be applicable to such series. Provisions of this Article
X not designated, pursuant to Section 2.3, as applying to a particular series of
Securities shall have no force and effect as to the Securities of such series.
In each provision of this Article X, unless the context otherwise requires, all
references to Securities and any other defined terms refer only to a single
series of Securities for which such provision has been designated, pursuant to
Section 2.3, as being applicable.
Section 10.1 REPURCHASE OF SECURITIES AT OPTION OF THE HOLDER UPON
CHANGE OF CONTROL.
(a) In the event that a Change of Control Triggering Event
occurs, each Holder of Securities shall have the right, at such Holder's option,
subject to the terms and conditions of this Indenture, to require the Issuers to
repurchase all or any part of such Holder's Securities (provided, that the
principal amount of such Securities at maturity must be $1,000 or an integral
multiple thereof) on the date that is no later than 45 Business Days after the
occurrence of such Change of Control Triggering Event (the "Change of Control
Purchase Date"), at a Cash price equal to 101% of the principal amount thereof
(the "Change of Control Purchase Price"), plus accrued but unpaid interest, if
any, to the Change of Control Purchase Date.
(b) In the event that, pursuant to this Section 10.1, the
Issuers shall be required to commence an offer to purchase Securities (a "Change
of Control Offer"), the Issuers shall follow the procedures set forth in this
Section 10.1 as follows:
(1) the Change of Control Offer shall commence within
20 Business Days following the Change of Control Triggering Event;
(2) the Change of Control Offer shall remain open for
at least 20 Business Days;
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(3) within 5 Business Days following the expiration of
a Change of Control Offer, the Issuers shall purchase all of the tendered
Securities at the Change of Control Purchase Price, plus accrued interest;
(4) if the Change of Control Purchase Date is on or
after an interest payment record date and on or before the related interest
payment date, any accrued interest will be paid to the person in whose name
a Security is registered at the close of business on such record date, and
no additional interest will be payable to Securityholders who tender
Securities pursuant to the Change of Control Offer;
(5) the Issuers shall use their best efforts to
provide the Trustee with notice of the Change of Control Offer at least 5
Business Days before the commencement of any Change of Control Offer; and
(6) on or before the commencement of any Change of
Control Offer, the Issuers or the Trustee (upon the request and at the
expense of the Issuers) shall send, by first-class mail, a notice to each
of the Securityholders, which (to the extent consistent with this
Indenture) shall govern the terms of the Change of Control Offer and shall
state:
(i) that the Change of Control Offer is being made
pursuant to this Section 10.1 and that all Securities, or portions
thereof, tendered will be accepted for payment;
(ii) the Change of Control Purchase Price (including
the amount of accrued but unpaid interest) and the Change of Control
Purchase Date;
(iii) that any Security, or portion thereof, not
tendered or accepted for payment will continue to accrue interest;
(iv) that, unless the Issuers default in depositing
Cash with the Paying Agent in accordance with the last paragraph of
this subsection (b), or such payment is prevented for any
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reason, any Security, or portion thereof, accepted for payment
pursuant to the Change of Control Offer shall cease to accrue interest
after the Change of Control Purchase Date;
(v) that Holders electing to have a Security, or
portion thereof, purchased pursuant to a Change of Control Offer will
be required to surrender the Security, with the form entitled "Option
of Holder to Elect Purchase" on the reverse of the Security completed,
to the Paying Agent (which may not for purposes of this Section 10.1,
notwithstanding anything in this Indenture to the contrary, be the
Issuers or any Affiliate of either of the Issuers) at the address
specified in the notice prior to the expiration of the Change of
Control Offer;
(vi) that Holders will be entitled to withdraw their
election, in whole or in part, if the Paying Agent receives, prior to
the expiration of the Change of Control Offer, a facsimile
transmission or letter setting forth the name of the Holder, the
principal amount of the Securities the Holder is withdrawing and a
statement containing a facsimile signature and stating that such
Holder is withdrawing his election to have such principal amount of
Securities purchased; and
(vii) a brief description of the events resulting in
such Change of Control Triggering Event.
Any such Change of Control Offer shall comply with any and all
applicable provisions of Federal and state laws, including those regulating
tender offers, if applicable, and any provisions of this Indenture which
conflict with such laws shall be deemed to be superseded by the provisions of
such laws.
On or before the Change of Control Purchase Date, the Issuers shall
(i) accept for payment Securities or portions thereof properly tendered pursuant
to the Change of Control Offer prior to the expiration of the Change of Control
Offer, (ii) deposit with the Paying Agent Cash sufficient to pay the Change of
Control Purchase Price (including accrued and unpaid interest) of all Securities
so tendered and (iii) deliver to the Trustee Securities so accepted together
with an Officers' Certificate
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listing the Securities or portions thereof being purchased by the Issuers. The
Paying Agent shall promptly pay to the Holders of Securities so accepted payment
in an amount equal to the Change of Control Purchase Price (plus accrued and
unpaid interest), and the Trustee shall promptly authenticate and mail or
deliver to such Holders a new Security equal in principal amount to any
unpurchased portion of the Security surrendered.
ARTICLE XI
GUARANTEES
Any or all of the provisions of this Article XI shall be applicable to
the Securities of any series for which such provision or provisions are
designated as applicable pursuant to the terms of Section 2.3. In addition, it
shall be established prior to the issuance of any series of Securities, pursuant
to Section 2.3, whether any guarantee or guarantees other than or in addition to
those specified below shall be applicable to such series. Provisions of this
Article XI not designated, pursuant to Section 2.3, as applying to a particular
series of Securities shall have no force and effect as to the Securities of such
series. In each provision of this Article XI, unless the context otherwise
requires, all references to Securities and any other defined terms refer only to
a single series of Securities for which such provision has been designated,
pursuant to Section 2.3, as being applicable.
Section 11.1 GUARANTEES.
(a) In consideration of good and valuable consideration, the
receipt and sufficiency of which is hereby acknowledged, each of the Guarantors
hereby irrevocably and unconditionally guarantees, jointly and severally, on a
senior subordinated basis (the "Guarantee") to each Holder of a Security
authenticated and delivered by the Trustee and to the Trustee and its successors
and assigns, irrespective of the validity and enforceability of this Indenture,
the Securities or the obligations of the Issuers under this Indenture or the
Securities, that: (w) the principal and premium (if any) of and interest on the
Securities will be paid in full when due, whether at the maturity or interest
payment date, by acceleration, call for redemption, upon an Change of Control
Offer, an Asset Sale Offer or otherwise; (x) all other obligations of the
Issuers to the Holders or the Trustee under this Indenture or the Securities
will be promptly paid in full or performed, all in accordance with the terms of
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this Indenture and the Securities; and (y) in case of any extension of time of
payment or renewal of any Securities or any of such other obligations, they will
be paid in full when due or performed in accordance with the terms of the
extension or renewal, whether at maturity, by acceleration, call for redemption,
upon an Offer to Purchase or otherwise. Failing payment when due of any amount
so guaranteed for whatever reason, each Guarantor shall be obligated to pay the
same before failure so to pay becomes an Event of Default.
(b) Each Guarantor hereby agrees that its obligations with
regard to this Guarantee shall be unconditional, irrespective of the validity,
regularity or enforceability of the Securities or this Indenture, the absence of
any action to enforce the same, the recovery of any judgment against the
Issuers, any action to enforce the same or any other circumstances that might
otherwise constitute a legal or equitable discharge or defense of a guarantor.
Each Guarantor hereby waives diligence, presentment, demand of payment, filing
of claims with a court in the event of insolvency or bankruptcy of the Issuers,
any right to require a proceeding first against the Issuers or right to require
the prior disposition of the assets of the Issuers to meet its obligations,
protest, notice and all demands whatsoever and covenants that this Guarantee
will not be discharged except by complete performance of the obligations
contained in the Securities and this Indenture.
(c) If any Holder or the Trustee is required by any court or
otherwise to return to either the Issuers or any Guarantor, or any Custodian,
Trustee, or similar official acting in relation to either the Issuers or such
Guarantor, any amount paid by either the Issuers or such Guarantor to the
Trustee or such Holder, this Guarantee, to the extent theretofore discharged,
shall be reinstated in full force and effect. Each Guarantor agrees that it
will not be entitled to any right of subrogation in relation to the Holders in
respect of any obligations guaranteed hereby until payment in full of all
obligations guaranteed hereby. Each Guarantor further agrees that, as between
such Guarantor, on the one hand, and the Holders and the Trustee, on the other
hand, (i) the maturity of the obligations guaranteed hereby may be accelerated
as provided in Section 6.2 for the purposes of this Guarantee, notwithstanding
any stay, injunction or other prohibition preventing such acceleration as to the
Issuers of the obligations guaranteed hereby, and (ii) in the event of any
declaration of acceleration of those obligations as provided in Section 6.2,
those obligations (whether or not due
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and payable) will forthwith become due and payable by each of the Guarantors for
the purpose of this Guarantee.
(d) Each Guarantor and by its acceptance of a Security issued
hereunder each Holder hereby confirms that it is the intention of all such
parties that the guarantee by such Guarantor set forth in Section 11.1(a) not
constitute a fraudulent transfer or conveyance for purpose of any Bankruptcy
Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act
or any similar Federal or state law. To effectuate the foregoing intention, the
Holders and such Guarantor hereby irrevocably agree that the obligations of such
Guarantor under its guarantee set forth in Section 11.1(a) shall be limited to
the maximum amount as will, after giving effect to all other contingent and
fixed liabilities of such Guarantor and after giving effect to any collections
from or payments made by or on behalf of any other Guarantor in respect of the
obligations of such other Guarantor under its Guarantee or pursuant to the
following paragraph of this Section 11.1(d), result in the obligations of such
Guarantor under such guarantee not constituting such a fraudulent transfer or
conveyance.
Each Guarantor that makes any payment or distribution under Section
11.1(a) shall be entitled to a contribution from each other Guarantor equal to
its Pro Rata amount of such payment or distribution so long as the exercise of
such right does not impair the rights of the Holders under the Guarantees. For
purposes of the foregoing, the "Pro Rata amount" of any Guarantor means the
percentage of the net assets of all Guarantors held by such Guarantor,
determined in accordance with GAAP.
Section 11.2 EXECUTION AND DELIVERY OF GUARANTEE.
To evidence its Guarantee set forth in Section 11.1, each Guarantor
agrees that a notation of such Guarantee substantially in the form established
pursuant to Section 2.3 shall be endorsed on each Security authenticated and
delivered by the Trustee and that this Indenture shall be executed on behalf of
such Guarantor by an Officer by manual or facsimile signature.
Each Guarantor agrees that its Guarantee set forth in Section 11.1
shall remain in full force and effect and apply to all the applicable Securities
notwithstanding any failure to endorse on each such Security a notation of such
Guarantee.
If an Officer whose signature is on a Security no longer holds that
office at the time the Trustee authenticates
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the Security on which a Guarantee is endorsed, the Guarantee shall be valid
nevertheless.
The delivery of any Security by the Trustee, after the authentication
thereof hereunder, shall constitute due delivery of the Guarantee set forth in
this Indenture on behalf of each Guarantor.
Section 11.3 CERTAIN BANKRUPTCY EVENTS.
Each Guarantor hereby covenants and agrees that in the event of the
insolvency, bankruptcy, dissolution, liquidation or reorganization of either of
the Issuers, such Guarantor shall not file (or join in any filing of), or
otherwise seek to participate in the filing of, any motion or request seeking to
stay or to prohibit (even temporarily) execution on the Guarantee and hereby
waives and agrees not to take the benefit of any such stay of execution, whether
under Section 362 or 105 of the United States Bankruptcy Code or otherwise.
Section 11.4 LIMITATION ON MERGER, CONSOLIDATION, ETC. OF
GUARANTORS.
No Guarantor shall consolidate or merge with or into (whether or not
such Guarantor is the surviving person) another person unless (i) subject to the
provisions of the following paragraph, the person formed by or surviving any
such consolidation or merger (if other than such Guarantor) assumes all the
obligations of such Guarantor pursuant to a supplemental indenture in form
reasonably satisfactory to the Trustee, pursuant to which such person shall
unconditionally guarantee, on a senior subordinated basis, all of such
Guarantor's obligations under such Guarantor's guarantee and the Indenture on
the terms set forth in the Indenture; and (ii) immediately before and
immediately after giving effect to such transaction on a pro forma basis, no
Default or Event of Default shall have occurred or be continuing.
Notwithstanding the foregoing, upon the sale or disposition (whether
by merger, stock purchase, asset sale or otherwise) of a Guarantor or all or
substantially all of its assets to an entity which is not a Subsidiary or the
designation of a Subsidiary as an Unrestricted Subsidiary, which transaction is
otherwise in compliance with the Indenture (including, without limitation, the
provisions of Section 4.13, to the extent applicable), such Guarantor will be
deemed released from its obligations under its Guarantee of the Securities;
PROVIDED,
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HOWEVER, that any such termination shall occur only to the extent that all
obligations of such Guarantor under all of its guarantees of, and under all of
its pledges of assets or other security interests which secure, any Indebtedness
of either Issuer or any of their Subsidiaries shall also terminate upon such
release, sale or transfer.
Section 11.5 FUTURE GUARANTORS.
Upon the acquisition by the Issuers or any Guarantor of the Capital
Stock of any person, if, as a result of such acquisition, such person becomes a
Subsidiary, such Subsidiary shall fully and unconditionally guarantee on a
senior subordinated basis the obligations of the Issuers with respect to payment
and performance of the Securities and the other obligations of the Issuers under
this Indenture to the same extent that such obligations are guaranteed by the
other Guarantors pursuant to Section 11.1; and, within 60 days of the date of
such occurrence, such Subsidiary shall execute and deliver to the Trustee a
supplemental indenture making such Subsidiary a party to this Indenture.
ARTICLE XII
SUBORDINATION
Unless otherwise designated pursuant to Section 2.3, the provisions of
this Article XII shall be applicable to the Securities of each series
(Securities of such series being referred to as "Subordinated Debt Securities").
Provisions of this Article XII designated, pursuant to Section 2.3, as being
inapplicable to a particular series of Securities shall have no force and effect
as to the Securities of such series. In each provision of this Article XII,
unless the context otherwise requires, all references to Securities or
Subordinated Debt Securities and any other defined terms refer only to a single
series of Securities or Subordinated Debt Securities, as the case may be, for
which such provision has not been designated, pursuant to Section 2.3, as being
inapplicable.
Section 12.1 SECURITIES SUBORDINATED TO SENIOR DEBT.
The Issuers, the Guarantors, if any, and each Holder, by its
acceptance of Subordinated Debt Securities, agree that (a) the payment of the
principal of and interest on the Subordinated Debt Securities and (b) any other
payment in respect of the Subordinated Debt Securities, including on account of
the acqui-
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sition or redemption of the Subordinated Debt Securities by the Issuers or the
Guarantors (including, without limitation, pursuant to Section 4.13 or 10.1, to
the extent applicable), if any, is subordinated, to the extent and in the manner
provided in this Article XII, to the prior payment in full in Cash or Cash
Equivalents of all Senior Debt of the Issuers and the Guarantors, if any, and
that these subordination provisions are for the benefit of the holders of Senior
Debt.
This Article XII shall constitute a continuing offer to all persons
who, in reliance upon such provisions, become holders of, or continue to hold,
Senior Debt, and such provisions are made for the benefit of the holders of
Senior Debt, and such holders are made obligees hereunder and any one or more of
them may enforce such provisions.
Section 12.2 NO PAYMENT ON SECURITIES IN CERTAIN CIRCUMSTANCES.
(a) No payment of any kind or character from any source may be
made by or on behalf of the Issuers or a Guarantor, if any, as applicable, on
account of the principal of, premium, if any, or interest or Additional Amounts
on the Subordinated Debt Securities (including any repurchases of Subordinated
Debt Securities and rescission payments), or on account of the redemption
provisions of the Subordinated Debt Securities, for Cash or property (other than
from the trust described in Article VIII), (i) upon the maturity of any Senior
Debt of the Issuers or such Guarantor, if any, by lapse of time, acceleration
(unless waived) or otherwise, unless and until all principal of, premium, if
any, the interest on and any fee or other amount due in respect of such Senior
Debt are first paid in full in Cash or Cash Equivalents or otherwise to the
extent holders accept satisfaction of amounts due by settlement in other than
Cash or Cash Equivalents, or (ii) in the event of default in the payment of any
principal of, premium, if any, or interest on or any fee or other amount due in
respect of Senior Debt of the Issuers or such Guarantor, if any, when it becomes
due and payable, whether at maturity or at a date fixed for prepayment or by
declaration or otherwise (a "Payment Default"), unless and until such Payment
Default has been cured or waived or otherwise has ceased to exist.
(b) Upon (i) the happening of an event of default (other than a
Payment Default) that permits the holders of Senior Debt to declare such Senior
Debt to be due and payable and (ii) written notice of such event of default
given to the Trustee by
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the Representative under the Credit Agreement or the holders of an aggregate of
at least $25 million principal amount outstanding of any other Senior Debt or
their representative (a "Payment Blockage Notice"), then, unless and until such
event of default has been cured or waived or otherwise has ceased to exist, no
payment (by set-off or otherwise) may be made by or on behalf of the Issuers or
any Guarantor which is an obligor under such Senior Debt on account of the
principal of, premium, if any or interest or Additional Amounts on the
Subordinated Debt Securities, including any repurchases of Subordinated Debt
Securities and rescission payments, or on account of the redemption provisions
of the Subordinated Debt Securities, other than payments from the trust
described in Article VIII; PROVIDED, HOWEVER, that so long as the Credit
Agreement is in effect, a Payment Blockage Notice may only be given by the
Representative under the Credit Agreement unless otherwise agreed in writing by
the requisite lenders under the Credit Agreement. Notwithstanding the
immediately preceding sentence, unless the Senior Debt in respect of which such
event of default exists has been declared due and payable in its entirety within
179 days after the Payment Blockage Notice is delivered as set forth above (the
"Payment Blockage Period") (and such declaration has not been rescinded or
waived), at the end of the Payment Blockage Period, the Issuers and the
Guarantors, if any, shall be required to pay, unless a Payment Default has then
occurred and is continuing, all sums not paid to the Holders of the Subordinated
Debt Securities during the Payment Blockage Period due to the foregoing
prohibitions and to resume all other payments as and when due on the
Subordinated Debt Securities. Any number of Payment Blockage Notices may be
given; PROVIDED, HOWEVER, that (i) not more than one Payment Blockage Notice
shall be given within a period of any 360 consecutive days, and (ii) no default
that existed upon the date of such Payment Blockage Notice or the commencement
of such Payment Blockage Period (whether or not such event of default is on the
same issue of Senior Debt) shall be made the basis for the commencement of any
other Payment Blockage Period, unless such event of default shall have been
cured or waived for a period of not less than 90 days.
(c) In furtherance of the provisions of Section 12.1, in the
event that, notwithstanding the foregoing provisions of this Section 12.2 or the
provisions of Section 12.3, any payment or distribution of assets (other than
from the trust described in Article VIII and, in the case of Section 12.3,
Junior Securities) shall be received by the Trustee or the Holders at a time
when such payment or distribution is prohibited by such provisions, such payment
or distribution shall be held in
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trust for the benefit of the holders of such Senior Debt, and shall be paid or
delivered by the Trustee or such Holders, as the case may be, to the holders of
such Senior Debt remaining unpaid or unprovided for or to their representative
or representatives, or to the trustee or trustees under any indenture pursuant
to which any instruments evidencing any of such Senior Debt may have been
issued, ratably according to the aggregate principal amounts remaining unpaid on
account of such Senior Debt held or represented by each, for application to the
payment of all such Senior Debt remaining unpaid, to the extent necessary to pay
all such Senior Debt in full in Cash or Cash Equivalents or otherwise to the
extent holders accept satisfaction of amounts due by settlement in other than
Cash or Cash Equivalents after giving effect to any concurrent payment or
distribution to the holders of such Senior Debt.
Section 12.3 SECURITIES SUBORDINATED TO PRIOR PAYMENT OF ALL SENIOR
DEBT ON DISSOLUTION, LIQUIDATION OR REORGANIZATION.
Upon any distribution of assets of either Issuer or any Guarantor upon
any dissolution, winding up, total or partial liquidation or reorganization of
either Issuer or any Guarantor whether voluntary or involuntary, in bankruptcy,
insolvency, receivership or a similar proceeding or upon assignment for the
benefit of creditors or any marshalling of assets or liabilities:
(a) the holders of all Senior Debt of such Issuer or such
Guarantor, if any, as applicable, will first be entitled to receive payment on
account of all principal of, premium, if any, interest on and fees and other
amounts payable in respect of such Senior Debt in full in Cash or Cash
Equivalents or otherwise to the extent holders accept satisfaction of amounts
due by settlement in other than Cash or Cash Equivalents before the Holders of
Subordinated Debt Securities are entitled to receive any payment on account of
principal of, premium, if any, and interest or Additional Amounts on the
Subordinated Debt Securities, including any repurchase of Subordinated Debt
Securities and rescission payments, or on account of the redemption provisions
of the Subordinated Debt Securities, other than Junior Securities or from the
trust described in Article VIII; and
(b) any payment or distribution of assets of such Issuer or such
Guarantor, if any, of any kind or character from any source, whether in Cash,
property or securities (other than Junior Securities or from the trust described
in Article VIII) to which the Holders of Subordinated Debt Securities or the
Trustee on behalf of such Holders would be entitled (by set-off or other-
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wise), except for the provisions of Article VIII, will be paid by the
liquidating trustee or agent or other person making such a payment or
distribution directly to the holders of such Senior Debt or their representative
to the extent necessary to make payment in full in Cash or Cash Equivalents on
all such Senior Debt remaining unpaid, after giving effect to any concurrent
payment or distribution to the holders of such Senior Debt.
Section 12.4 SECURITYHOLDERS TO BE SUBROGATED TO RIGHTS OF HOLDERS
OF SENIOR DEBT.
Subject to the payment in full in Cash or Cash Equivalents of all
Senior Debt of the Issuers and the Guarantors, if any, as provided herein, the
Holders of Subordinated Debt Securities shall be subrogated to the rights of the
holders of such Senior Debt to receive payments or distributions of assets of
the Issuers and the Guarantors, if any, applicable to the Senior Debt until all
amounts owing on the Subordinated Debt Securities shall be paid in full, and for
the purpose of such subrogation no such payments or distributions to the holders
of such Senior Debt by or on behalf of the Issuers or the Guarantors, if any, or
by or on behalf of the Holders by virtue of this Article XII, which otherwise
would have been made to the Holders of Subordinated Debt Securities shall, as
between the Issuers and Guarantors, if any, and such Holders, be deemed to be
payment by the Issuers or the Guarantors, if any, or on account of such Senior
Debt, it being understood that the provisions of this Article XII are and are
intended solely for the purpose of defining the relative rights of the Holders
of Subordinated Debt Securities, on the one hand, and the holders of such Senior
Debt, on the other hand.
If any payment or distribution to which the Holders would otherwise
have been entitled but for the provisions of this Article XII shall have been
applied, pursuant to the provisions of this Article XII, to the payment of
amounts payable under Senior Debt of the Issuers or the Guarantors, if any, then
the Holders of Subordinated Debt Securities shall be entitled to receive from
the holders of such Senior Debt any payments or distributions received by such
holders of Senior Debt in excess of the amount sufficient to pay all amounts
payable under or in respect of such Senior Debt in full in Cash or Cash
Equivalents.
Section 12.5 OBLIGATIONS OF THE ISSUERS UNCONDITIONAL.
Nothing contained in this Article XII or elsewhere in this Indenture
or in the Subordinated Debt Securities is intended to or shall impair, as
between the Issuers and Guarantors, if
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any, and any Holders, the obligation of each such person, which is absolute and
unconditional, to pay to the Holders the principal of, premium, if any, and
interest on the Subordinated Debt Securities as and when the same shall become
due and payable in accordance with their terms, or is intended to or shall
affect the relative rights of the Holders and creditors of the Issuers and the
Guarantors, if any, other than the holders of the Senior Debt, nor shall
anything herein or therein prevent the Trustee or any Holder from exercising all
remedies otherwise permitted by applicable law upon default under this
Indenture, subject to the rights, if any, under this Article XII and under the
PROVISO to Section 6.2, of the holders of Senior Debt in respect of Cash,
property or securities of the Issuers or the Guarantors, if any, received upon
the exercise of any such remedy or otherwise. Notwithstanding anything to the
contrary in this Article XII or elsewhere in this Indenture or in the
Subordinated Debt Securities, upon any distribution of assets of the Issuers
referred to in this Article XII, the Trustee, subject to the provisions of
Sections 6.1 and 6.2, and the Holders shall be entitled to rely upon any order
or decree made by any court of competent jurisdiction in which such dissolution,
winding up, liquidation or reorganization proceedings are pending, or a
certificate of the liquidating Trustee or agent or other person making any
distribution to the Trustee or to the Holders for the purpose of ascertaining
the persons entitled to participate in such distribution, the holders of the
Senior Debt and other Indebtedness of the Issuers and the Guarantors, if any,
the amount thereof or payable thereon, the amount or amounts paid or distributed
thereon and all other facts pertinent thereto or to this Article XII so long as
such court has been apprised of the provisions of, or the order, decree or
certificate makes reference to, the provisions of this Article XII. Nothing in
this Section 12.5 shall apply to the claims of, or payments to, the Trustee
under or pursuant to Section 6.7.
Section 12.6 TRUSTEE ENTITLED TO ASSUME PAYMENTS NOT PROHIBITED IN
ABSENCE OF NOTICE.
The Trustee shall not at any time be charged with knowledge of the
existence of any facts which would prohibit the making of any payment to or by
the Trustee unless and until a Trust Officer of the Trustee or any Paying Agent
shall have received, no later than two Business Days prior to such payment,
written notice thereof from the Issuers or from one or more holders of Senior
Debt or from any representative therefor and, prior to the receipt of any such
written notice, the Trustee, subject to the provisions of Sections 7.1 and 7.2,
shall be enti-
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tled in all respects conclusively to assume that no such fact exists. The
Issuers shall give prompt written notice to the Trustee of any fact actually
known to the Issuers which would prohibit the making of any payment to or by the
Trustee in respect of the Subordinated Debt Securities.
Section 12.7 APPLICATION BY TRUSTEE OF ASSETS DEPOSITED WITH IT.
Amounts deposited in trust with the Trustee pursuant to and in
accordance with Article VIII shall be for the sole benefit of Securityholders
and, to the extent allocated for the payment of Subordinated Debt Securities,
shall not be subject to the subordination provisions of this Article XII.
Otherwise, any deposit of assets with the Trustee or any Paying Agent (whether
or not in trust) for the payment of principal of or interest on any Subordinated
Debt Securities shall be subject to the provisions of Sections 12.1, 12.2, 12.3
and 12.4; PROVIDED that, if prior to two Business Days preceding the date on
which by the terms of this Indenture any such assets may become distributable
for any purpose (including without limitation, the payment of either principal
of or interest on any Subordinated Debt Security) the Trustee or such Paying
Agent shall not have received with respect to such assets the written notice
provided for in Section 12.6, then the Trustee or such Paying Agent shall have
full power and authority to receive such assets and to apply the same to the
purpose for which they were received, and shall not be affected by any notice to
the contrary which may be received by it on or after such date.
Section 12.8 SUBORDINATION RIGHTS NOT IMPAIRED BY ACTS OR OMISSIONS
OF THE ISSUERS, GUARANTORS OR HOLDERS OF SENIOR DEBT, ETC.; MODIFICATIONS.
No right of any present or future holders of any Senior Debt to
enforce subordination provisions contained in this Article XII shall at any time
in any way be prejudiced or impaired by any act or failure to act on the part of
the Issuers, the Guarantors, if any, or by any act or failure to act, in good
faith, by any such holder, or by any noncompliance by the Issuers or the
Guarantors, if any, with the terms of this Indenture, regardless of any
knowledge thereof which any such holder may have or be otherwise charged with.
The holders of Senior Debt may extend, renew, modify or amend the terms of the
Senior Debt or any security therefor and release, sell or exchange such security
and otherwise deal freely with the Issuers and the Guarantors, if any, all
without affecting the liabilities and obligations of the
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parties to this Indenture or the Holders. The subordination provisions are
solely for the benefit of the holders from time to time of Senior Debt and may
not be rescinded, canceled, amended or modified in any way other than any
amendment or modification that would not adversely affect the rights of any
holder of Senior Debt or any amendment or modification that is consented to by
each holder of Senior Debt that would be affected thereby. The subordination
provisions of this Article XII shall continue to be effective or be reinstated,
as the case may be, if at any time payment and performance of the Senior Debt
is, pursuant to applicable law, avoided, recovered or rescinded or must
otherwise be restored or returned by any holder of Senior Debt, whether as a
"voidable preference," "fraudulent conveyance," "fraudulent transfer," or
otherwise, all as though such payment or performance had not been made.
Section 12.9 SECURITYHOLDERS AUTHORIZE TRUSTEE TO EFFECTUATE
SUBORDINATION OF SECURITIES.
Each Holder of the Subordinated Debt Securities by his acceptance
thereof authorizes and expressly directs the Trustee on his behalf to take such
action as may be necessary or appropriate to effectuate the subordination
provisions contained in this Article XII and to protect the rights of the
Holders pursuant to this Indenture, and appoints the Trustee his
attorney-in-fact for such purpose, including, in the event of any dissolution,
winding up, liquidation or reorganization of the Issuers or any Guarantor
(whether in bankruptcy, insolvency or receivership proceedings or upon an
assignment for the benefit of creditors or any other marshalling of assets and
liabilities of the Issuers and the Guarantors, if any), the immediate filing of
a claim for the unpaid balance of his Subordinated Debt Securities in the form
required in said proceedings and cause said claim to be approved. If the
Trustee does not file a proper claim or proof of debt in the form required in
such proceeding prior to 30 days before the expiration of the time to file such
claim or claims, then the holders of the Senior Debt or their representative are
or is hereby authorized to have the right to file and are or is hereby
authorized to file an appropriate claim for and on behalf of the Holders of said
Subordinated Debt Securities. Nothing herein contained shall be deemed to
authorize the Trustee or the holders of Senior Debt or their representative to
authorize or consent to or accept or adopt on behalf of any Securityholder any
plan of reorganization, arrangement, adjustment or composition affecting the
Subordinated Debt Securities or the rights of any Holder thereof, or to
authorize the Trustee or the holders of Senior Debt or their representative to
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vote in respect of the claim of any Securityholder in any such proceeding.
Section 12.10 RIGHT OF TRUSTEE TO HOLD SENIOR DEBT.
The Trustee shall be entitled to all of the rights set forth in this
Article XII in respect of any Senior Debt at any time held by it to the same
extent as any other holder of Senior Debt, and nothing in this Indenture shall
be construed to deprive the Trustee of any of its rights as such holder.
Section 12.11 ARTICLE XII NOT TO PREVENT EVENTS OF DEFAULT.
The failure to make a payment on account of principal of, premium, if
any, or interest on the Subordinated Debt Securities by reason of any provision
of this Article XII shall not be construed as preventing the occurrence of a
Default or an Event of Default under Section 7.1 or in any way limit the rights
of the Trustee or any Holder to pursue any other rights or remedies with respect
to the Subordinated Debt Securities.
Section 12.12 NO FIDUCIARY DUTY OF TRUSTEE TO HOLDERS OF SENIOR DEBT.
Notwithstanding anything to the contrary herein, the Trustee shall not
be deemed to owe any fiduciary duty to any present or future holders of Senior
Debt, and shall not be liable to any such holders (other than for its wilful
misconduct or negligence) if it shall in good faith mistakenly pay over or
distribute to the Holders of Subordinated Debt Securities or the Issuers or
Guarantors, if any, or any other person, Cash, property or securities to which
any holders of Senior Debt shall be entitled by virtue of this Article XII or
otherwise. The Trustee undertakes to perform or to observe only such of the
covenants and obligations as are specifically set forth in this Article XII, and
no implied covenants or obligations with respect to such holders of Senior Debt
shall be implied in this Indenture against the Trustee. Nothing in this Section
12.12 shall affect the obligation of any other such person to hold such payment
for the benefit of, and to pay such payment over to, the holders of Senior Debt
or their representative. In the event of any conflict between the fiduciary
duty of the Trustee to the Holders of Subordinated Debt Securities and its duty
to the holders of Senior Debt, the Trustee is expressly authorized to resolve
such conflict in favor of the Holders.
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ARTICLE XIII
MISCELLANEOUS
Section 13.1 TIA CONTROLS.
If any provision of this Indenture limits, qualifies, or conflicts
with the duties imposed by operation of the TIA, the imposed duties, upon
qualification of this Indenture under the TIA, shall control.
Section 13.2 NOTICES.
Any notices or other communications to the Issuers, the Guarantors or
the Trustee required or permitted hereunder shall be in writing, and shall be
sufficiently given if made by hand delivery, by telecopier or registered or
certified mail, postage prepaid, return receipt requested, addressed as follows:
if to the Issuers or any Guarantor:
Sun International Hotels Limited
Coral Towers
Paradise Island, The Bahamas
Attention: General Counsel
Telephone: (242) 363-3000
Telecopy: (242) 363-3703
if to the Trustee:
[ ]
The Issuers, the Guarantors, if any, or the Trustee by notice to each
other party may designate additional or different addresses as shall be
furnished in writing by such party. Any notice or communication to the Issuers,
the Guarantors or the Trustee shall be deemed to have been given or made as of
the date so delivered, if personally delivered; when receipt is acknowledged, if
telecopied; and 5 Business Days after mailing if sent by registered or certified
mail, postage prepaid (except that a notice of change of address shall not be
deemed to have been given until actually received by the addressee).
Any notice or communication mailed to a Securityholder shall be mailed
to him by first class mail or other equivalent means at his address as it
appears on the registration books of
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the Registrar and shall be sufficiently given to him if so mailed within the
time prescribed.
Failure to mail a notice or communication to a Securityholder or any
defect in it shall not affect its sufficiency with respect to other
Securityholders. If a notice or communication is mailed in the manner provided
above, it is duly given, whether or not the addressee receives it.
Section 13.3 COMMUNICATIONS BY HOLDERS WITH OTHER HOLDERS.
Securityholders may communicate pursuant to TIA Section 312(b) with
other Securityholders with respect to their rights under this Indenture or the
Securities. The Issuers, the Guarantors, the Trustee, the Registrar and any
other person shall have the protection of TIA Section 312(c).
Section 13.4 CERTIFICATE AND OPINION AS TO CONDITIONS PRECEDENT.
Upon any request or application by the Issuers to the Trustee to take
any action under this Indenture, the Issuers shall furnish to the Trustee:
(1) an Officers' Certificate (in form and substance
reasonably satisfactory to the Trustee) stating that, in the opinion of the
signers, all conditions precedent, if any, provided for in this Indenture
relating to the proposed action have been complied with; and
(2) an Opinion of Counsel (in form and substance
reasonably satisfactory to the Trustee) stating that, in the opinion of
such counsel, all such conditions precedent have been complied with.
Section 13.5 STATEMENTS REQUIRED IN CERTIFICATE OR OPINION.
Each certificate or opinion with respect to compliance with a
condition or covenant provided for in this Indenture shall include:
(1) a statement that the person making such
certificate or opinion has read such covenant or condition;
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(2) a brief statement as to the nature and scope of
the examination or investigation upon which the statements or opinions
contained in such certificate or opinion are based;
(3) a statement that, in the opinion of such person,
he has made such examination or investigation as is necessary to enable him
to express an informed opinion as to whether or not such covenant or
condition has been complied with; and
(4) a statement as to whether or not, in the opinion
of each such person, such condition or covenant has been complied with;
PROVIDED, HOWEVER, that with respect to matters of fact an Opinion of
Counsel may rely on an Officers' Certificate or certificates of public
officials.
Section 13.6 RULES BY TRUSTEE, PAYING AGENT, REGISTRAR.
The Trustee may make reasonable rules for action by or at a meeting of
Securityholders. The Paying Agent or Registrar may make reasonable rules for
its functions.
Section 13.7 LEGAL HOLIDAYS.
A "Legal Holiday" used with respect to a particular place of payment
is a Saturday, a Sunday or a day on which banking institutions in New York, New
York are not required to be open. If a payment date is a Legal Holiday in New
York, New York, payment may be made at such place on the next succeeding day
that is not a Legal Holiday, and no interest shall accrue for the intervening
period.
Section 13.8 GOVERNING LAW.
THIS INDENTURE AND THE SECURITIES SHALL BE GOVERNED BY AND CONSTRUED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, AS APPLIED TO
CONTRACTS MADE AND PERFORMED WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO
PRINCIPLES OF CONFLICTS OF LAW. THE ISSUERS AND EACH GUARANTOR HEREBY
IRREVOCABLY SUBMIT TO THE JURISDICTION OF ANY NEW YORK STATE COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK OR ANY FEDERAL COURT SITTING IN
THE BOROUGH OF MANHATTAN IN THE CITY OF NEW YORK IN RESPECT OF ANY SUIT, ACTION
OR PROCEEDING ARISING OUT OF OR
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RELATING TO THIS INDENTURE AND THE SECURITIES, AND IRREVOCABLY ACCEPTS FOR
ITSELF AND IN RESPECT OF ITS PROPERTY, GENERALLY AND UNCONDITIONALLY,
JURISDICTION OF THE AFORESAID COURTS. THE ISSUERS AND EACH GUARANTOR
IRREVOCABLY WAIVE, TO THE FULLEST EXTENT THEY MAY EFFECTIVELY DO SO UNDER
APPLICABLE LAW, TRIAL BY JURY AND ANY OBJECTION WHICH THEY MAY NOW OR HEREAFTER
HAVE TO THE LAYING OF THE VENUE OF ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN ANY SUCH COURT AND ANY CLAIM THAT ANY SUCH SUIT, ACTION OR PROCEEDING BROUGHT
IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. NOTHING HEREIN
SHALL AFFECT THE RIGHT OF THE TRUSTEE OR ANY SECURITYHOLDER TO SERVE PROCESS IN
ANY OTHER MANNER PERMITTED BY LAW OR TO COMMENCE LEGAL PROCEEDINGS OR OTHERWISE
PROCEED AGAINST THE ISSUERS OR ANY GUARANTOR IN ANY OTHER JURISDICTION.
Section 13.9 NO ADVERSE INTERPRETATION OF OTHER AGREEMENTS.
This Indenture may not be used to interpret another indenture, loan or
debt agreement of any of the Issuers, the Guarantors or any of their
Subsidiaries. Any such indenture, loan or debt agreement may not be used to
interpret this Indenture.
Section 13.10 NO RECOURSE AGAINST OTHERS.
A director, officer, employee, stockholder or incorporator, as such,
of the Issuers or the Guarantors shall not have any liability for any
obligations of the Issuers or the Guarantors under the Securities or this
Indenture. Each Securityholder by accepting a Security waives and releases all
such liability. Such waiver and release are part of the consideration for the
issuance of the Securities.
Section 13.11 SUCCESSORS.
All agreements of the Issuers and the Guarantors in this Indenture and
the Securities shall bind their successors. All agreements of the Trustee in
this Indenture shall bind its successor.
Section 13.12 DUPLICATE ORIGINALS.
All parties may sign any number of copies or counterparts of this
Indenture. Each signed copy or counterpart shall be an original, but all of
them together shall represent the same agreement.
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Section 13.13 SEVERABILITY.
In case any one or more of the provisions in this Indenture or in the
Securities shall be held invalid, illegal or unenforceable, in any respect for
any reason, the validity, legality and enforceability of any such provision in
every other respect and of the remaining provisions shall not in any way be
affected or impaired thereby, it being intended that all of the provisions
hereof shall be enforceable to the full extent permitted by law.
Section 13.14 TABLE OF CONTENTS, HEADINGS, ETC.
The Table of Contents, Cross-Reference Table and headings of the
Articles and the Sections of this Indenture have been inserted for convenience
of reference only, are not to be considered a part hereof and shall in no way
modify or restrict any of the terms or provisions hereof.
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SIGNATURE
IN WITNESS WHEREOF, the parties hereto have caused this Indenture to
be duly executed as of the date first written above.
SUN INTERNATIONAL HOTELS LIMITED
By:
---------------------------------
Name:
Title:
SUN INTERNATIONAL NORTH AMERICA, INC.
By:
---------------------------------
Name:
Title:
[ ], as Trustee
By:
---------------------------------
Name:
Title:
GUARANTORS:
SUN INTERNATIONAL BAHAMAS LIMITED
By:
---------------------------------
Name:
Title:
<PAGE>
PARADISE ISLAND LIMITED
By:
---------------------------------
Name:
Title:
ISLAND HOTEL COMPANY LIMITED
By:
---------------------------------
Name:
Title:
PARADISE BEACH INN LIMITED
By:
---------------------------------
Name:
Title:
PARADISE ENTERPRISES LIMITED
By:
---------------------------------
Name:
Title:
PARADISE ACQUISITIONS LIMITED
By:
---------------------------------
Name:
Title:
<PAGE>
SUN INTERNATIONAL MANAGEMENT LIMITED
By:
---------------------------------
Name:
Title:
SUN COVE, LTD.
By:
---------------------------------
Name:
Title:
RESORTS INTERNATIONAL HOTEL, INC.
By:
---------------------------------
Name:
Title:
GGRI, INC.
By:
---------------------------------
Name:
Title:
<PAGE>
Exhibit 23.1
[LETTERHEAD OF ARTHUR ANDERSEN LLP]
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
-----------------------------------------
To Sun International Hotels Limited:
As independent public accountants, we hereby consent to the incorporation by
reference in this registration statement on Amendment No. 1 to Form F-3 of
our report dated February 21, 1997 (except with respect to the matters
discussed in Note 18 to the Financial Statements, as to which the date is
March 10, 1997) included in the Company's Form 20-F for the year ended
December 31, 1996 (and incorporated by reference in the Company's reports on
Form 6-K dated March 11, 1997 and on Form 6-K/A dated February 27, 1997 and
November 24, 1997) and to all references to our Firm included in this
registration statement.
/s/ Arthur Andersen LLP
---------------------------
ARTHUR ANDERSEN LLP
Roseland, New Jersey
December 2, 1997
<PAGE>
Exhibit 23.2
Consent of Independent Auditors
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form F-3 No. 333-41127), Amendment No. 1 and related
Prospectus of Sun International Hotels Limited and Sun International North
America, Inc. for the registration of Debt Securities and to the incorporation
by reference therein of our report dated February 14, 1997, except for Note 18,
as to which the date is March 17, 1997, with respect to the consolidated
financial statements and schedule of Sun International North America, Inc.
included in its Annual Report (Form 10-K) for the year ended December 31, 1996,
filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
Philadelphia, Pennsylvania
December 2, 1997
<PAGE>
================================================================================
Exhibit 25.1
FORM T-1
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE
CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2) |__|
----------------------------
THE BANK OF NEW YORK
(Exact name of trustee as specified in its charter)
New York 13-5160382
(State of incorporation (I.R.S. employer
if not a U.S. national bank) identification no.)
48 Wall Street, New York, N.Y. 10286
(Address of principal executive offices) (Zip code)
----------------------------
SUN INTERNATIONAL HOTELS LIMITED
SUN INTERNATIONAL NORTH AMERICA, INC.
(Exact name of obligor as specified in its charter)
Commonwealth of The Bahamas 98-0136554
Delaware 59-0763055
(State or other jurisdiction of (I.R.S. employer
incorporation or organization) identification no.)
Sun International Hotels Limited International North America, Inc.
Coral Towers 1415 E. Sunrise Blvd., 10th Floor
Paradise Island, The Bahamas Ft. Lauderdale, Florida 33304
(Address of principal executive offices)
----------------------------
TABLE OF ADDITIONAL REGISTRANTS
NAME OF ADDITIONAL REGISTRANTS JURISDICTION OF ORGANIZATION I.R.S. NO.
- ------------------------------ ---------------------------- ----------
SUN INTERNATIONAL BAHAMAS LIMITED Commonwealth of The Bahamas N/A
PARADISE ACQUISITIONS LIMITED Commonwealth of The Bahamas N/A
PARADISE ISLAND LIMITED Commonwealth of The Bahamas N/A
PARADISE ENTERPRISES LIMITED Commonwealth of The Bahamas N/A
ISLAND HOTEL COMPANY LIMITED Commonwealth of The Bahamas N/A
PARADISE BEACH INN LIMITED Commonwealth of The Bahamas N/A
SUN INTERNATIONAL MANAGEMENT LIMITED British Virgin Islands N/A
GGRI, INC. Delaware 22-2962648
RESORTS INTERNATIONAL HOTEL, INC. New Jersey 21-0423320
SUN COVE, LTD. Connecticut 36-4041616
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Debt Securities
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(Title of the indenture securities)
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2
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1. GENERAL INFORMATION. FURNISH THE FOLLOWING INFORMATION AS TO THE TRUSTEE:
(a) Name and address of each examining or supervising authority to which
it is subject.
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Name Address
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Superintendent of Banks of the 2 Rector Street, New York,
State of New York N.Y. 10006, and Albany, N.Y. 12203
Federal Reserve Bank of New York 33 Liberty Plaza, New York,
N.Y. 10045
Federal Deposit Insurance Corporation Washington, D.C. 20429
New York Clearing House Association New York, New York 10005
(B) WHETHER IT IS AUTHORIZED TO EXERCISE CORPORATE TRUST POWERS.
Yes.
2. AFFILIATIONS WITH OBLIGOR.
IF THE OBLIGOR IS AN AFFILIATE OF THE TRUSTEE, DESCRIBE EACH SUCH
AFFILIATION.
None.
16. LIST OF EXHIBITS.
EXHIBITS IDENTIFIED IN PARENTHESES BELOW, ON FILE WITH THE COMMISSION, ARE
INCORPORATED HEREIN BY REFERENCE AS AN EXHIBIT HERETO, PURSUANT TO RULE
7A-29 UNDER THE TRUST INDENTURE ACT OF 1939 (THE "ACT") AND 17 C.F.R.
229.10(D).
1. A copy of the Organization Certificate of The Bank of New York
(formerly Irving Trust Company) as now in effect, which contains the
authority to commence business and a grant of powers to exercise
corporate trust powers. (Exhibit 1 to Amendment No. 1 to Form T-1
filed with Registration Statement No. 33-6215, Exhibits 1a and 1b to
Form T-1 filed with Registration Statement No. 33-21672 and Exhibit 1
to Form T-1 filed with Registration Statement No. 33-29637.)
4. A copy of the existing By-laws of the Trustee. (Exhibit 4 to Form T-1
filed with Registration Statement No. 33-31019.)
6. The consent of the Trustee required by Section 321(b) of the Act.
(Exhibit 6 to Form T-1 filed with Registration Statement No.
33-44051.)
7. A copy of the latest report of condition of the Trustee published
pursuant to law or to the requirements of its supervising or examining
authority.
3
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SIGNATURE
Pursuant to the requirements of the Act, the Trustee, The Bank of New York,
a corporation organized and existing under the laws of the State of New York,
has duly caused this statement of eligibility to be signed on its behalf by the
undersigned, thereunto duly authorized, all in The City of New York, and State
of New York, on the 1st day of December, 1997.
THE BANK OF NEW YORK
By: /s/ Mary Beth A. Lewicki
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Name: Mary Beth A. Lewicki
Title: Assistant Vice President
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Exhibit 7
Consolidated Report of Condition of
THE BANK OF NEW YORK
of 48 Wall Street, New York, N.Y. 10286
And Foreign and Domestic Subsidiaries,
a member of the Federal Reserve System, at the close of business June 30, 1997,
published in accordance with a call made by the Federal Reserve Bank of this
District pursuant to the provisions of the Federal Reserve Act.
Dollar Amounts
in Thousands
ASSETS
Cash and balances due from depos-
itory institutions:
Noninterest-bearing balances and
currency and coin .................. $ 7,769,502
Interest-bearing balances .......... 1,472,524
Securities:
Held-to-maturity securities ........ 1,080,234
Available-for-sale securities ...... 3,046,199
Federal funds sold and Securities pur-
chased under agreements to resell...... 3,193,800
Loans and lease financing
receivables:
Loans and leases, net of unearned
income ............................ 35,352,045
LESS: Allowance for loan and
lease losses ...................... 625,042
LESS: Allocated transfer risk
reserve............................ 429
Loans and leases, net of unearned
income, allowance, and reserve..... 34,726,574
Assets held in trading accounts ....... 1,611,096
Premises and fixed assets (including
capitalized leases) ................. 676,729
Other real estate owned ............... 22,460
Investments in unconsolidated
subsidiaries and associated
companies .......................... 209,959
Customers' liability to this bank on
acceptances outstanding ............ 1,357,731
Intangible assets .................... 720,883
Other assets ......................... 1,627,267
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Total assets ......................... $57,514,958
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LIABILITIES
Deposits:
In domestic offices ................ $26,875,596
Noninterest-bearing ................ 11,213,657
Interest-bearing ................... 15,661,939
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In foreign offices, Edge and
Agreement subsidiaries, and IBFs ... 16,334,270
Noninterest-bearing ................ 596,369
Interest-bearing ................... 15,737,901
Federal funds purchased and Securities
sold under agreements to repurchase. 1,583,157
Demand notes issued to the U.S.
Treasury ........................... 303,000
Trading liabilities .................. 1,308,173
Other borrowed money:
With remaining maturity of one year
or less .......................... 2,383,570
With remaining maturity of more than
one year through three years.......... 0
With remaining maturity of more than
three years ...................... 20,679
Bank's liability on acceptances exe-
cuted and outstanding .............. 1,377,244
Subordinated notes and debentures .... 1,018,940
Other liabilities .................... 1,732,792
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Total liabilities .................... 52,937,421
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EQUITY CAPITAL
Common stock ........................ 1,135,284
Surplus ............................. 731,319
Undivided profits and capital
reserves .......................... 2,721,258
Net unrealized holding gains
(losses) on available-for-sale
securities ........................ 1,948
Cumulative foreign currency transla-
tion adjustments .................. (12,272)
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Total equity capital ................ 4,577,537
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Total liabilities and equity
capital ........................... $57,514,958
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I, Robert E. Keilman, Senior Vice President and Comptroller of the
above-named bank do hereby declare that this Report of Condition has been
prepared in conformance with the instructions issued by the Board of Governors
of the Federal Reserve System and is true to the best of my knowledge and
belief.
Robert E. Keilman
We, the undersigned directors, attest to the correctness of this Report of
Condition and declare that it has been examined by us and to the best of our
knowledge and belief has been prepared in conformance with the instructions
issued by the Board of Governors of the Federal Reserve System and is true and
correct.
/ /
Alan R. Griffith / /
J. Carter Bacot / /
Thomas A. Renyi / / Directors
/ /
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