DESCRIPTION OF THE NEW NOTES
General
You can find definitions of certain terms used in this description under the heading "Certain Definitions." For purposes
of this "Description of the New Notes" section, references to the "
Company
", "
we
",
"
us
", and "
our
" include only CIFC Corp., and not its Subsidiaries or the PTP Parent.
The
Company issued the old notes and will issue the new notes under an indenture (the "
Indenture
") dated as of November 2, 2015
among the Company, the Guarantors, as defined therein, and U.S. Bank National Association, as trustee (the "
Trustee
"). The Company thereafter entered
into the first supplemental indenture, dated April 4th, 2016, among the Company, CIFC Holdings I LLC, a Delaware limited liability company and newly formed, wholly-owned direct
subsidiary of PTP Parent, CIFC Holdings II Sub LLC, a Delaware limited liability company and newly formed, wholly-owned indirect subsidiary of PTP Parent, CIFC Holdings III Sub LLC, a
Delaware limited liability company and newly formed, wholly-owned indirect subsidiary of PTP Parent, and U.S. Bank National Association, as trustee, for the purpose of adding CIFC Holdings II
Sub LLC and CIFC Holdings III Sub LLC as guarantors under the Indenture. The terms of the new notes will include those stated in the Indenture and those made part of the Indenture by
reference to the terms of the Trust Indenture Act. Unless the context otherwise requires, the term "notes" includes the old notes and the new notes.
We
have summarized selected terms and provisions of the Indenture. We urge you to read the Indenture in its entirety because it, and not this description, defines your rights. The terms
of the new notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (the
"
TIA
"). The TIA will become applicable to the Indenture upon the qualification of the Indenture under the TIA, which will occur at such time as the new
notes have been registered under the Securities Act. The Indenture provides that the Company will comply with the provisions of §314 of the TIA to the extent applicable.
The
following summary of selected provisions of the Indenture and the new notes is not complete and is subject to, and is qualified in its entirety by reference to, all provisions of the
Indenture. If you would like more information on any of these provisions, you should refer to and read the relevant sections of the Indenture.
The
new notes will be issued only in fully registered book-entry form without coupons in minimum denominations of $1,000 principal amount and integral multiples of $1,000 above that
amount. The new notes will be issued in the form of a global note (the "
global note
"). The global note will be registered in the name of
Cede & Co. ("
Cede
"), the nominee of DTC, New York, New York, as described under "Denomination, Transfer, Exchange and
Book-Entry Procedures."
Principal Amount; Maturity and Interest
The Company will issue the new notes in an initial aggregate principal amount of up to $40,000,000. The new notes will be denominated
in U.S. dollars and all payments of principal and interest thereon will be paid in U.S. dollars.
The
new notes will bear interest at a rate per annum equal to 8.50%. We will pay interest semi-annually in arrears on April 30 and October 30 of each year, beginning on
April 30, 2016. Each such date is referred to as an interest payment date. Interest on the new notes will be payable to the person in whose name such new notes are registered on April 15
and October 15 immediately preceding the applicable interest payment date. Interest payable on the new notes will accrue from the date it was most recently paid and be computed on the basis of
a 360-day year comprised of twelve 30-day months.
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If
an interest payment date falls on a day that is not a Business Day, the interest payment will be postponed to the next succeeding Business Day, with the same force and effect as if
made on the date such payment was due, and no interest will accrue as a result of such delay.
The
new notes will mature on October 30, 2025 (the "
Maturity Date
"), unless earlier repurchased or redeemed in accordance with the
Indenture.
Additional Notes
The new notes will initially be limited to $40,000,000 aggregate principal amount. The Company may "reopen" this series of new notes
and issue additional new notes ("
additional new notes
") in an amount up to $15,000,000 under a one-time additional new notes issuance under the
Indenture;
provided
that (i) the terms of the additional new notes issued are identical to the terms of the new notes being offered hereby
(except for the issue date and public offering price), (ii) the additional new notes cannot be sold for less than 100% of par value and (iii) an affirmation of each Rating Agency then
rating and monitoring the new notes (which affirmation may be by email) has been received that the additional new notes issuance would not result in the Rating of the new notes being lower than the
Required Rating.
Paying Agent and Registrar for the New Notes
The Company will maintain one or more paying agents (each, a "
paying agent
") for the
new notes.
The
Company will also maintain one or more registrars (each, a "
registrar
") and a transfer agent. The registrar(s) and transfer agent will
maintain a register reflecting ownership of new notes outstanding from time to time and will make payments on and facilitate transfer of new notes on behalf of the Company.
The
Trustee will initially act as paying agent, registrar and transfer agent with respect to the new notes. The Company may change the paying agent or registrar without prior notice to
the Holders.
Ranking
The new notes will be the Company's senior unsecured obligations and the payment of the principal of, premium, if any, and interest on
the new notes and any payment by any Guarantor under any Guarantee of the new notes will rank (i) equally in right of payment with all of the Company's or the applicable Guarantor's, as the
case may be, other existing and future Indebtedness and other obligations of the Company or the applicable Guarantor, as the case may be, that are not by their terms expressly subordinated in right of
payment to the new notes or the applicable Guarantee of the new notes, and (ii) senior in right of payment to all of the Company's or the applicable Guarantor's, as the case may be, existing
and future subordinated Indebtedness, from time to time outstanding.
The
new notes will be effectively subordinated to all of the Company's and the Guarantors' existing and future secured obligations to the extent of the value of the collateral securing
such obligations, and structurally subordinated to any existing and future obligations of any of the Company's or the Guarantors' Subsidiaries (which, in each case, are not themselves also Guarantors)
with respect to claims against the assets of such Subsidiaries. In the event of bankruptcy or insolvency, any secured creditors will have a prior secured claim to any collateral securing the debt owed
to them. Neither the Company nor any of its Subsidiaries have any other outstanding senior notes. As of December 31, 2015, the Company and the Guarantors had, in the aggregate,
$160 million of Indebtedness (of which $40 million was the outstanding principal of the new notes and $120 million was the subordinated Indebtedness, and non of which would have
been secured Indebtedness).
Although
the Indenture contains limitations on the amount of additional Indebtedness that the Company and the Restricted Entities (as defined herein) may incur, under certain
circumstances the
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amount
of such additional Indebtedness could be substantial and, in any case, such additional Indebtedness may be secured Indebtedness. See "Certain CovenantsLimitation on
the Incurrence of Additional Indebtedness."
As
set out under "Guarantees" below, certain of the Restricted Entities may cease to, guarantee the new notes (each, a "
Non-Guarantor
Entity
"). In the event of a bankruptcy, liquidation, reorganization or similar proceeding of any of the Non-Guarantor Entities, such Non-Guarantor Entity will pay the holders
of its debt and trade creditors before they will be able to distribute any of its assets to the Company or, if such Non-Guarantor Entity is a Subsidiary of a Guarantor, to such Guarantor. As a result,
all of the existing and future liabilities of our Non-Guarantor Entities, including any claims of trade creditors, will be effectively senior to the new notes with respect to the assets of any such
Non-Guarantor Entity.
Guarantees
Each of the Guarantors as of the Issue Date will unconditionally guarantee the performance of all Obligations of the Company under the
Indenture and the new notes on an unsecured basis. The PTP Parent will be a Guarantor of the new notes. The Obligations of each Guarantor in respect of its Guarantee will be limited as necessary to
purport to prevent the Guarantees from constituting a fraudulent conveyance, fraudulent transfer or similar illegal transfer under applicable law. See "Risk FactorsRisks Related to the
New NotesFederal and state fraudulent transfer laws permit a court to void the new notes and the Guarantees, and, if that occurs, you may not receive any payments on the new notes."
Each
Guarantor (other than, with respect to clauses (2), (3) and (4) below, the PTP Parent) will be released and relieved of its obligations under its Guarantee in
the event:
-
(1)
-
there
is a discharge, Legal Defeasance or Covenant Defeasance as discussed under "Satisfaction and Discharge" or "Defeasance of
Certain Covenants";
-
(2)
-
there
is a sale or other disposition of Capital Stock of a Guarantor following which such Guarantor is no longer a direct or indirect Subsidiary of the
Company or, following the PTP Conversion, the PTP Parent;
-
(3)
-
there
is a sale of all or substantially all of the assets of a Guarantor (including by way of merger, stock purchase, asset sale or otherwise permitted by
the Indenture) to a Person that is not (either before or after giving effect to such transaction) a Restricted Entity; or
-
(4)
-
such
Guarantor is designated as Non-Guarantor Entity;
provided
, that, in each case, such transactions are carried out pursuant to and in accordance with all applicable covenants and provisions of the
Indenture.
If
any Person becomes a Restricted Entity (for the avoidance of doubt, including upon a Revocation of the Designation of such Person as an Unrestricted Entity), subject to the next
succeeding paragraph, the Company or, following the PTP Conversion, the Company or the PTP Parent, as applicable, will cause those Restricted Entities to become Guarantors by executing a supplemental
indenture and providing the Trustee with an Officers' Certificate and Opinion of Counsel. In accordance with the terms of the Indenture, after the supplemental indenture becomes effective, the Company
will notify Holders of such event in accordance with the Indenture.
The
Indenture also provides that the Company may designate any Restricted Entity other than, following the PTP Conversion, the PTP Parent as a Non-Guarantor Entity if the Consolidated
Total Assets of such Restricted Entity, together with the Consolidated Total Assets of all then-existing Non-Guarantor Entities designated pursuant to the Indenture on a combined and Consolidated
basis and taken as a whole without duplication, would not represent 10% or more of the Company's
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Consolidated
Total Assets or, following the PTP Conversion, 10% or more of the PTP Parent's Consolidated Total Assets as of the end of the most recently completed fiscal quarter of the Company or the
PTP Parent, as applicable (the foregoing, the "
Non-Guarantor Limitation
");
provided that
, for the
avoidance of doubt, the foregoing restrictions shall not apply to, and any calculation with respect to the Non-Guarantor Limitation shall not include, any Foreign Manager Owned Affiliates. If, as of
the end of any fiscal quarter of the Company or PTP Parent, as applicable, the Consolidated Total Assets of the Non-Guarantor Entities, on a combined and Consolidated basis and taken as a whole
without duplication, exceed the Non-Guarantor Limitation, the Company shall be required to add one or more Non-Guarantor Entities as Guarantors in order to comply therewith. The Company shall promptly
notify the Trustee of any such addition and otherwise comply with the provisions of the Indenture regarding additional Guarantors.
Any
Subsidiary of the Company and, following the PTP Conversion, any Subsidiary of the PTP Parent (a "
PTP Parent Subsidiary
") that is not
a Guarantor, including any Subsidiary of the Company or any PTP Parent Subsidiary that is Designated as an Unrestricted Entity pursuant to and in accordance with the Indenture, will pay the holders of
its debt and its trade creditors before it will be able to distribute any of its assets to the Company or a Guarantor in the event of any bankruptcy or insolvency proceeding of such entity. In
addition, holders of minority interests in these Subsidiaries of the Company or the PTP Parent, as applicable, may receive distributions prior to or
pro
rata
with the Company or such Guarantor, depending on the terms of the equity interests.
Any
Guarantor that makes a payment under its Guarantee will be entitled, upon payment in full of all guaranteed obligations under the Indenture, to a contribution from each other
Guarantor in an amount equal to such other Guarantor's
pro rata
portion of such payment based on the respective net assets of all the Guarantors at the
time of such payment, as determined in accordance with GAAP.
If
a Guarantor's Guarantee of the new notes were to be rendered voidable, it could be subordinated by a court to all other Indebtedness (including other Guarantees and contingent
liabilities) of the Guarantor and, depending on the amount of such Indebtedness, a Guarantor's liability on its Guarantee of the new notes could be reduced to zero. The terms of each Guarantee will be
limited as necessary to seek to prevent the Guarantee from constituting a fraudulent conveyance or fraudulent transfer under applicable law. See "Risk FactorsRisks Related to the New
NotesFederal and state fraudulent transfer laws permit a court to void the new notes and the related Guarantees, and, if that occurs, you may not receive any payments on the new notes."
Optional Redemption
Prior to October 30, 2020, the Company may redeem, at its option, all or part of the new notes upon not less than 10 nor more
than 60 days' prior notice (with a copy to the Trustee) at a redemption price equal to the sum of (i) 100% of the principal amount of the new notes to be redeemed,
plus
(ii) the
Applicable Premium as of the date of redemption,
plus
(iii) accrued and
unpaid interest to but not including, the date of redemption (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date).
On
or after October 30, 2020, the Company may redeem, at its option, all or part of the new notes upon not less than 10 nor more than 60 days' prior notice (with a copy to
the Trustee) at the following redemption prices, expressed as percentages of the outstanding principal amount thereof, together with any accrued and unpaid interest to the date of redemption (subject
to the right of Holders of record on
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the
relevant record date to receive interest due on the relevant interest payment date), if redeemed during the twelve-month period commencing on October 30 of any year set forth below:
|
|
|
|
|
Year
|
|
Percentage
|
|
2020
|
|
|
104.250
|
%
|
2021
|
|
|
102.834
|
%
|
2022
|
|
|
101.417
|
%
|
2023 and thereafter
|
|
|
100.000
|
%
|
"
Applicable Premium
" means, with respect to any new note on any date of redemption, as determined by the Company, the excess (if any) of
(a) the present value at such date of redemption of (1) the redemption price of such new note at October 30, 2020, as set forth in the table above
plus
(2) all required interest
payments due on such new note through October 30, 2020 (excluding accrued but unpaid interest), computed
using a discount rate equal to the Treasury Rate on such date of redemption
plus
50 basis points over (b) the principal amount outstanding of
such new note.
"
Treasury Rate
" means, as of any date of redemption, the yield to maturity as of such date of redemption of U.S. Treasury securities with
a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the date
of redemption (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the date of redemption to
October 30, 2020;
provided
that if the period from the date of redemption to such date is not equal to the constant maturity of a U.S. Treasury
security for which a yield is given, the Treasury yield shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the yields of the nearest U.S. Treasury
securities for which such yields are given, except that if the period from the date of redemption to such date is less than one year, the weekly average yield on actually traded U.S. Treasury
securities adjusted to a constant maturity of one year will be used.
In
addition, until October 30, 2020, the Company may, at its option, on one or more occasions, redeem up to 35% of the aggregate principal amount of new notes at a redemption
price equal to 108.500% of the aggregate principal amount thereof (such percentage to be equal to 100% plus the annual coupon on the new notes), plus accrued and unpaid interest to the date of
redemption (subject to the right of Holders of record on the relevant record date to receive interest due on the relevant interest payment date), with the net cash proceeds of one or more Equity
Offerings;
provided
that at least 65% of the sum of the original aggregate principal amount of new notes issued under the Indenture and the original
principal amount of any additional new notes issued under the Indenture after the Issue Date remains outstanding immediately after the occurrence of each such redemption;
provided further
that each such
redemption occurs within 90 days of the date of closing of each such Equity Offering.
In
the event that less than all of the new notes are to be redeemed at any time, DTC will select the new notes to be redeemed by lot in accordance with its applicable procedures in the
case of new notes represented by the global note and otherwise on a pro rata basis, by lot or by such other method as the Trustee shall deem fair and appropriate, subject to the redemption procedures
of the applicable depositary. No new notes of a principal amount of $1,000 or less may be redeemed in part and new
notes of a principal amount in excess of $1,000 may be redeemed in part in multiples of $1,000 only so long as any principal amount of new notes remaining unredeemed is in an authorized denomination.
The
Company will pay the applicable redemption price for any new note together with accrued and unpaid interest thereon through, but excluding, the date of redemption. On and after the
date of redemption, interest will cease to accrue on new notes or portions thereof called for redemption as long as the Company has deposited with the paying agent immediately available funds in
satisfaction of
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the
redemption price pursuant to the Indenture. Upon redemption of any new notes by the Company, such redeemed new notes will be cancelled.
Mandatory Redemption; Offers to Purchase; Open Market Purchases
Under certain circumstances, the Company may be required to offer to purchase new notes as described under "Certain
CovenantsChange of Control Triggering Event." The Company may at any time and from time to time purchase new notes through tender offers, in the open market, in negotiated transactions or
otherwise. Any such purchases shall be conducted in accordance with applicable securities laws, and may be made so long as such purchase does not otherwise violate the terms of the Indenture. New
notes acquired and held by the Company or Affiliates thereof may not be voted in any vote of Holders and may be subject to other limitations.
Registration Rights
Holders will have registration rights pursuant to the terms of a Registration Rights Agreement, as described under "Exchange Offers;
Registration Rights."
Financial Information Following the PTP Conversion
Under generally accepted accounting principles, the PTP Conversion was accounted for on a historical cost basis whereby the
consolidated assets and liabilities of the PTP Parent were recorded at the historical cost of CIFC as reflected on CIFC's consolidated financial statements. Accordingly, the consolidated financial
statements of the PTP Parent immediately following the PTP Conversion are substantially similar to the consolidated financial statements of CIFC immediately prior to the PTP Conversion. Any reference
in this Description of the New Notes to a Four Quarter Period, twelve-month period or other period with respect to financial information of the Company or the PTP Parent which period includes the date
the PTP Conversion is consummated (the "
Conversion Date
") refers to (i) the financial information of CIFC for any portion of such period prior to
the Conversion Date, and (ii) the financial information of the PTP Parent for any portion of such period following the Conversion Date.
Certain Covenants
Suspension of Covenants
During any period of time that (i) the new notes have an Investment Grade Rating from any Rating Agency and (ii) no
Default or Event of Default has occurred and is continuing (the occurrence of the events described in the foregoing clauses (i) and (ii) being collectively referred to as a
"
Covenant Suspension Event
"), the Company and the Restricted Entities will not be subject to the provisions of the Indenture described
under:
-
1.
-
"Limitation
on the Incurrence of Additional Indebtedness";
-
2.
-
"Limitation
on Guarantees";
-
3.
-
"Limitation
on Designation of Unrestricted Entities";
-
4.
-
"Limitation
on Restricted Payments";
-
5.
-
"Limitation
on Asset Sales and Sales of Subsidiary Stock";
-
6.
-
clause (2)
of "Limitation on Merger, Consolidation or Sale of Assets;" and
-
7.
-
"Limitation
on Transactions with Affiliates;"
(collectively,
the "
Suspended Covenants
").
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In
the event that the Company and the Restricted Entities are not subject to the Suspended Covenants for any period of time as a result of the foregoing, and on any subsequent date (the
"
Reversion Date
") a Rating Agency withdraws its Investment Grade Rating or downgrades its rating assigned to the new notes below an Investment Grade
Rating so that the new notes no longer have an Investment Grade Rating from any Rating Agency then rating the new notes, then the Company and the Restricted Entities will thereafter again be subject
to the Suspended Covenants. The period of time from the date of the Covenant Suspension Event until the Reversion Date is referred to as the "
Suspension
Period
." If after any Reversion Date, an additional Covenant Suspension Event occurs, the Company and the
Restricted Entities will again not be subject to the Suspended Covenants. Notwithstanding that the Suspended Covenants may be reinstated, no Default or Event of Default will be deemed to have occurred
as a result of a failure to comply with the Suspended Covenants during the Suspension Period (or upon termination of the Suspension Period or after that time based solely on events that occurred
during the Suspension Period).
On
the Reversion Date, all Indebtedness Incurred during the Suspension Period will be classified as having been Incurred pursuant to clause (1) or any subclause of
clause (2) of "Limitation on the Incurrence of Additional Indebtedness" below (to the extent such Indebtedness would be permitted to be Incurred thereunder as of the Reversion Date
and after giving effect to Indebtedness Incurred prior to the Suspension Period and outstanding on the Reversion Date). To the extent such Indebtedness would not be so permitted to be Incurred
pursuant to clause (1) or any subclause of clause (2) of "Limitation on the Incurrence of Additional Indebtedness," such Indebtedness will be deemed to have been outstanding
on the Issue Date (it being understood that any such Indebtedness that could have been incurred only pursuant to subclause (l) of clause (2) shall nevertheless be deemed to have been
outstanding on the Issue Date), so that, in each case, such Indebtedness is classified as permitted under clause (2)(c) of "Limitation on the Incurrence of Additional
Indebtedness." Calculations made after the Reversion Date of the amount available to be made as Restricted Payments under "Limitation on Restricted Payments" will be made as though the
covenant described under "Limitation on Restricted Payments" had been in effect since the Issue Date and throughout the Suspension Period.
On
the Reversion Date, any Affiliate Transaction entered into after the Reversion Date pursuant to a contract agreement, loan, advance or guaranty with, or for the benefit of, any
Affiliate of the Company entered into during the Suspension Period will be deemed to have been in effect as of the Issue Date for purposes of clause (2)(c) under "Limitation on
Transactions with Affiliates."
On
the Reversion Date, for purposes of "Limitation on Asset Sales and Sales of Subsidiary Stock," the unutilized Excess Proceeds amount will be reset to zero.
There
can be no assurance that the new notes will ever achieve or maintain Investment Grade Ratings.
Change of Control Triggering Event
Upon the occurrence of a Change of Control Triggering Event, each Holder will have the right to require that the Company purchase all
or a portion (in principal amounts of $1,000 and multiples of $1,000 in excess thereof) of the Holder's new notes at a purchase price equal to 101% of the outstanding principal amount thereof, plus
accrued and unpaid interest thereon, if any, to, but excluding, the date of purchase (the "
Change of Control Payment
"). Notwithstanding the
occurrence of a Change of Control Triggering Event, the Company will not be obligated to repurchase the new notes under this covenant if it has exercised its rights to redeem all the new notes under
"Optional Redemption."
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Holders
will not be entitled to require the Company to purchase their notes in the event of a takeover, recapitalization, leveraged buyout or similar transaction which is not a Change of
Control Triggering Event.
Within
30 days following the date upon which the Change of Control Triggering Event occurred, the Company must notify the Trustee in accordance with the Indenture (who shall
forward to each Holder), offering to purchase the new notes as described above (a "
Change of Control Offer
"). The Change of Control Offer shall state,
among other things, the purchase date, which must be no earlier than 10 days nor later than 60 days from the date of notice, other than as may be required by law (the
"
Change of Control Payment Date
").
On
the Business Day prior to the Change of Control Payment Date, the Company will, to the extent lawful, deposit with the Trustee, as paying agent, funds in an amount equal to the Change
of Control Payment in respect of all new notes or portions thereof so tendered. On the Change of Control Payment Date, the Company will, to the extent lawful:
-
(1)
-
accept
for payment all new notes or portions thereof properly tendered and not withdrawn pursuant to the Change of Control Offer; and
-
(2)
-
deliver
or cause to be delivered to the Trustee for cancellation the new notes so accepted together with an Officers' Certificate stating the aggregate
principal amount of new notes or portions thereof being purchased by the Company.
If
only a portion of a new note is purchased pursuant to a Change of Control Offer, adjustments to the amount and beneficial interests in the global note will be made, or should the new
notes be Certificated Notes, a new note in a principal amount equal to the portion thereof not purchased will be issued in the name of the Holder thereof upon cancellation of the original note.
The
Company will not be required to make a Change of Control Offer upon a Change of Control Triggering Event if (1) a third party makes the Change of Control Offer in the manner,
at the times and otherwise in compliance with the requirements set forth in the Indenture applicable to a Change of Control Offer made by the Company and purchases all new notes properly tendered and
not withdrawn under the Change of Control Offer, or (2) notice of redemption has been given pursuant to the Indenture as described under "Optional Redemption" and the new notes are
redeemed in full in accordance therewith within 60 days of such notice, unless and until there is a default in payment of the applicable redemption price.
New
notes repurchased by the Company pursuant to a Change of Control Offer will be cancelled and cannot be reissued. New notes purchased by a third party pursuant to the preceding
paragraph will have the status of new notes issued and outstanding.
In
the event that Holders of not less than 90% of the aggregate principal amount of the outstanding notes accept and do not withdraw their acceptance of a Change of Control Offer and the
Company or a third party purchases all of the new notes held by such Holders, the Company will have the right, on not less than 10 nor more than 60 days' prior notice, given not more than
30 days following the purchase pursuant to the Change of Control Offer described above, to redeem all of the new notes that remain outstanding following such purchase at a purchase price equal
to the Change of Control Payment plus, to the extent not included in the Change of Control Payment, accrued and unpaid interest, if any, on the new notes that remain outstanding, to the date of
redemption (subject to the right of Holders on the relevant record date to receive interest due on the relevant interest payment date).
Other
existing and future Indebtedness of the Company and the Restricted Entities may contain prohibitions on the occurrence of events that would constitute a Change of Control
Triggering Event or require that such other Indebtedness be repurchased upon a Change of Control Triggering Event.
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Moreover,
the exercise by the Holders of their right to require the Company to repurchase the new notes upon a Change of Control Triggering Event could cause a default under such Indebtedness even if
the Change of Control Triggering Event itself does not.
If
a Change of Control Offer occurs, there can be no assurance that the Company will have available funds sufficient to make the Change of Control Payment for all the new notes that
might be delivered by Holders seeking to accept the Change of Control Offer, which could cause a default under other existing and future Indebtedness. Moreover, the exercise by the Holders of their
right to require the Company to repurchase the new notes could cause a default under such other existing and future Indebtedness, even if the Change of Control Payment itself does not, due to the
financial effect of such
repurchase on the Company or its Subsidiaries. In the event the Company is required to purchase outstanding notes pursuant to a Change of Control Offer, the Company expects that it would seek
third-party financing to the extent it does not have available funds to meet its purchase obligations and any other obligations in respect of Senior Indebtedness. However, there can be no assurance
that the Company would be able to obtain necessary financing. See "Risk FactorsRisks Related to the New NotesWe may not be able to finance a change of control offer required
by the Indenture."
The
Company and, following the PTP Conversion, the PTP Parent, as applicable, will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable
securities laws and regulations, to the extent that such laws and regulations are applicable in connection with the purchase of new notes in connection with a Change of Control Offer.
To
the extent that the provisions of any securities laws or regulations conflict with the "Change of Control Triggering Event" provisions of the Indenture, the Company and, following the
PTP Conversion, the PTP Parent, as applicable, will comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the Indenture by doing so.
The
Change of Control Offer feature of the new notes may in certain circumstances make more difficult or discourage a sale or takeover of the Company or, following the PTP Conversion,
the PTP Parent, or their respective Subsidiaries, and, thus, the removal of incumbent management.
Subject
to the limitations discussed below, the Company and the Restricted Entities could, in the future, enter into certain transactions, including acquisitions, refinancings or other
recapitalizations, that would not constitute a Change of Control Triggering Event, but that could increase the amount of Indebtedness outstanding at such time or otherwise affect the capital structure
of the Company or the Restricted Entities, or their then prevailing credit ratings. Restrictions on the ability of the Company and the Restricted Entities to Incur additional Indebtedness are
contained in the covenants described under "Limitation on the Incurrence of Additional Indebtedness." Such restrictions can only be waived with the consent of the Holders of a majority in
principal amount of the new notes then outstanding.
The
definition of Change of Control Triggering Event includes a phrase relating to the direct or indirect sale, lease, transfer, conveyance or other disposition of "all or substantially
all" of the properties or assets of the Company or, following the PTP Conversion, the PTP Parent, and their respective Subsidiaries taken as a whole. Although there is a limited body of case law
interpreting the phrase "substantially all," there is no precise established definition of the phrase under applicable law. Accordingly, the ability of a Holder to require the Company to repurchase
its new notes as a result of a sale, lease, transfer, conveyance or other disposition of less than all of the assets of such entities, taken as a whole to another Person or group may be uncertain.
The
provisions under the Indenture relating to the Company's obligation to make an offer to repurchase the new notes as a result of a Change of Control Triggering Event may be waived or
modified with the written consent of the Holders of a majority in principal amount of the new notes.
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SEC Reports and Reports to Holders
Whether or not the Company or, following the PTP Conversion, the PTP Parent, is subject to the reporting requirements of
Section 13 or 15(d) of the Exchange Act, it shall provide the Trustee and, upon written request, the Holders of new notes within fifteen (15) Business Days after filing, or in the event
no such filing is required, within fifteen (15) Business Days after the end of the time periods specified in the SEC's rules and regulations for a filer that is a "non-accelerated filer" with
substantially the same quarterly and annual financial statements required to be contained in a filing with the SEC on Forms 10-Q and 10-K (but, for the avoidance of doubt, the other disclosure
requirements contained in such forms shall not be applicable), and, with respect to the annual financial information only, an audit report on the annual financial statements by the Company's or,
following the PTP Conversion, the PTP Parent's certified independent accountants;
provided
that, the foregoing delivery requirements will be deemed
satisfied if the foregoing materials are available on the SEC's EDGAR system or on the Company's website or, if the Company or, following the PTP Conversion, the PTP Parent, is not then subject to the
reporting requirements of Section 13 or 15(d) of
the Exchange Act, on a nonpublic website or posting through an electronic data room or filing sharing or similar service) within the applicable time period specified above.
To
the extent any such information is not so filed or furnished, as applicable, within the time periods specified above and such information is subsequently filed or furnished, as
applicable, the Company or, following the PTP Conversion, the PTP Parent will be deemed to have satisfied its obligations with respect thereto at such time and any Default or Event of Default with
respect thereto shall be deemed to have been cured;
provided
, that such cure shall not otherwise affect the rights of the Holders under "Events of
Default and Remedies" if the Trustee or Holders of at least 30% in principal amount of the then total outstanding notes have declared the principal, premium, if any, interest and any other monetary
obligations on all the then outstanding notes to be due and payable immediately and such declaration shall not have been rescinded or cancelled prior to such cure.
In
addition, to the extent not satisfied by the above, for so long as any of the new notes remain outstanding and constitute "restricted securities" under Rule 144, the Company
or, following the PTP Conversion, the PTP Parent, will furnish to the Holders and prospective investors in the new notes, upon their request, the information required to be delivered pursuant to
Rule 144A(d)(4) under the Securities Act;
provided
, that for this purpose, following the PTP Conversion, the PTP Parent shall be deemed to be the
"issuer" of the new notes within the meaning of Rule 144A(d)(4).
Any
information filed with, or furnished to, the SEC within the time periods specified in this covenant shall be deemed to have been furnished to the Holders as required by this
covenant, and to the extent such filings comply with the rules and regulations of the SEC regarding such filings, they will be deemed to comply with the requirements of this covenant.
If
at any time following the PTP Conversion, any direct or indirect parent company of the PTP Parent becomes a Guarantor (there being no obligation to do so) and such entity holds no
material assets other than cash, Cash Equivalents and the Capital Stock of the PTP Parent and complies with the requirements of Rule 3-10 of Regulation S-X promulgated by the SEC (or any
successor provision), the reports, information and other documents required to be filed and furnished to Holders pursuant to this covenant may, at the option of the Company, be filed by and be those
of such other parent company rather than the PTP Parent.
Limitation on the Incurrence of Additional Indebtedness
-
(1)
-
The
Company and, following the PTP Conversion, the PTP Parent, each will not, and will not cause or permit any Restricted Entity under their respective
control to, directly or indirectly, Incur any Indebtedness, including Acquired Indebtedness, except that the Company or any Restricted Entity may Incur Indebtedness, including Acquired Indebtedness,
if, at the time of
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and
immediately after giving pro forma effect to the Incurrence thereof and the application of the proceeds therefrom, the Consolidated Fixed Charge Coverage Ratio of the Company or, following the PTP
Conversion, of the PTP Parent, is greater than 2.5 to 1.0.
-
(2)
-
Notwithstanding
clause (1) above, the Company and the Restricted Subsidiaries and, following the PTP Conversion, the PTP Parent and the Restricted
Entities, as applicable, may Incur the following Indebtedness ("
Permitted Indebtedness
"):
-
(a)
-
the
new notes and the Guarantees, excluding any additional notes, but including any new notes (and any related Guarantees) issued pursuant to the
Registration Rights Agreement in exchange for the new notes;
-
(b)
-
the
incurrence of Indebtedness (which, for the avoidance of doubt, may be either secured or unsecured) under Credit Facilities by the Company or any of the
Restricted Entities and the issuance and creation of letters of credit and bankers' acceptances thereunder (with letters of credit and bankers' acceptances being deemed to have a principal amount
equal to the face amount thereof), up to an aggregate principal amount of $10.0 million, outstanding at any one time, less any permanent payments actually made by the borrower thereunder
following the Issue Date in respect of Indebtedness thereunder with Net Cash Proceeds from an Asset Sale;
-
(c)
-
Indebtedness
of the Company and the Restricted Subsidiaries outstanding on the Issue Date;
-
(d)
-
Hedging
Obligations entered into by the Company and the Restricted Entities in the ordinary course of business (including interest rate hedges against other
Indebtedness of the Company and the Restricted Entities) and not for speculative purposes;
-
(e)
-
intercompany
Indebtedness between the Company and any Restricted Entity or between any Restricted Entities;
provided
, that:
-
(A)
-
if
the Company or any Guarantor is the obligor on such Indebtedness, such Indebtedness must be expressly subordinated to the prior payment in full of all
obligations under the new notes and the Indenture in the case of the Company, or such Guarantor's Guarantee, in the case of any Guarantor, and
-
(B)
-
in
the event that at any time any such Indebtedness ceases to be held by the Company or a Restricted Entity, such Indebtedness shall be deemed to be
Incurred and not permitted by this clause (e) at the time such event occurs;
-
(f)
-
Indebtedness
of the Company or any of the Restricted Entities arising from the honoring by a bank or other financial institution of a check, draft or
similar instrument inadvertently (including daylight overdrafts paid in full by the close of business on the day such overdraft was Incurred) drawn against insufficient funds in the ordinary course of
business;
provided
, that such Indebtedness is extinguished within five Business Days of Incurrence;
-
(g)
-
Indebtedness
of the Company or any of the Restricted Entities represented by bid, surety or performance bonds or letters of credit for the account of the
Company or any Restricted Entity, as the case may be, issued in the ordinary course of business and not for financing purposes, and reimbursement obligations in respect thereof;
-
(h)
-
Refinancing
Indebtedness in respect of:
-
(A)
-
Indebtedness
(other than Indebtedness owed to the Company or a Restricted Entity) Incurred pursuant to clause (1) above (it being understood that no
Indebtedness outstanding on the Issue Date is Incurred pursuant to such clause (1) above), or
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-
(B)
-
Indebtedness
Incurred pursuant to clauses (b), (c) and (d) above, this clause (h) and clauses (j) and (k) below;
-
(i)
-
Indebtedness
arising from agreements entered into by the Company or a Restricted Entity providing for bona fide indemnification, adjustment of purchase
price or similar obligations (including in respect of earn-outs not for financing purposes), or from customary guarantees or performance bonds securing any obligations of the Company or any of the
Restricted Entities pursuant to such agreements, in each case, Incurred or assumed in connection with the acquisition or disposition of any business, assets or Capital Stock of a Restricted Entity,
provided
that, in the case of a disposition, the maximum aggregate liability in respect of such Indebtedness shall at no time exceed the gross proceeds
actually (including non-Cash proceeds based on their Fair Market Value at the time received) received by the Company and the Restricted Entities in connection with such disposition;
-
(j)
-
Indebtedness
of the Company or any Restricted Entity to the extent the net proceeds thereof are promptly (i) used to purchase notes pursuant to a
Change of Control Offer or a tender offer, or (ii) deposited to defease the new notes as described under "Defeasance of Certain Covenants;"
-
(k)
-
Permitted
Acquisition Indebtedness;
-
(l)
-
Indebtedness
representing deferred compensation to employees, officers or directors of the Company or any Restricted Entity incurred in the ordinary course
of business, consistent with industry practices and on commercially reasonable terms under the circumstances existing at the time such deferred compensation arrangement is established;
-
(m)
-
(A) Guarantees
by (1) the Company of Indebtedness of any Restricted Entity permitted to be Incurred by such Restricted Entity under this
covenant and (2) any Restricted Entity of any Indebtedness of the Company or another Restricted Entity permitted to be Incurred under this covenant by the Company or such other Restricted
Entity; and
-
(B)
-
Indebtedness
constituting a Lien included in clause (7) of the definition of Indebtedness (1) Incurred by the Company in respect of
Indebtedness of a Restricted Entity permitted to be Incurred by such Restricted Entity under this covenant and (2) Incurred by a Restricted Entity in respect of Indebtedness of the Company or
another Restricted Entity permitted to be Incurred under this covenant by the Company or such Restricted Entity (excluding Indebtedness of any such other Restricted Entity permitted under
clause (d) of this definition of Permitted Indebtedness or Refinancing Indebtedness in respect thereof), as the case may be, which Lien is granted in compliance with, if applicable,
"Limitation on Liens."
-
(3)
-
For
purposes of determining compliance with, and the outstanding principal amount of, any particular Indebtedness Incurred pursuant to and in compliance
with this covenant, the amount of Indebtedness issued at a price that is less than the principal amount thereof will be equal to the amount of the liability in respect thereof determined in accordance
with GAAP. Accrual of interest, the accretion or amortization of original issue discount, the payment of regularly scheduled interest in the form of additional Indebtedness of the same instrument or
the payment of regularly scheduled dividends on Disqualified Capital Stock in the form of additional Disqualified Capital Stock with the same terms will not be deemed to be an Incurrence of
Indebtedness for purposes of this covenant;
provided
, that any such outstanding additional Indebtedness or Disqualified Capital Stock paid in respect of
Indebtedness Incurred
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Limitation on Indebtedness for Money Borrowed
Neither the Company nor, following the PTP Conversion, the PTP Parent, may Incur any Indebtedness for money borrowed otherwise
permitted hereunder as Permitted Indebtedness if the Incurrence of such Indebtedness for money borrowed would result in a Rating of the new notes lower than the Required Rating, after giving effect to
such Incurrence of Indebtedness for money borrowed. In order for the Company or the PTP Parent to Incur Indebtedness in accordance with the provisions hereof, such entity shall obtain an affirmation
of each Rating Agency then rating and monitoring the new notes (which affirmation may be by email) that, after giving effect to the proposed Incurrence of Indebtedness for money borrowed, the Rating
of the new notes will be at least equal to the Required Rating.
Limitation on Guarantees
The Company and, following the PTP Conversion, the PTP Parent will not permit any Restricted Entity under their respective control
(other than a Guarantor in respect of a Guarantee of the new notes) to Guarantee any Indebtedness of the Company or any Guarantor or to secure any Indebtedness of the Company or any Guarantor with a
Lien on the assets of such Restricted Entity (other than Permitted Liens), unless contemporaneously therewith (or prior thereto) such Restricted Entity
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executes
and delivers a supplemental indenture to the Indenture providing a Guarantee of the new notes by such Restricted Entity;
provided
that no
Restricted Entity will be required to Guarantee the new notes to the extent it is prohibited by law from doing so. Any Guarantee by any such Restricted Entity of Subordinated Indebtedness of the
Company or any Guarantor will be subordinated and junior in right of payment to the contemporaneous Guarantee of the new notes by such Restricted Entity.
Limitation on Designation of Unrestricted Entities
The Company may designate on or after the Issue Date any direct or indirect Subsidiary of the Company and, following the PTP
Conversion, the PTP Parent may designate any direct or indirect Subsidiary of the PTP Parent (other than the Company) as an "
Unrestricted Entity
" under
the Indenture (a "
Designation
") only if:
-
(1)
-
no
Default or Event of Default shall have occurred and be continuing at the time of or immediately after giving effect to such Designation;
-
(2)
-
at
the time of and after giving effect to such Designation, the Company or the PTP Parent, as applicable, could Incur at least $1.00 of additional
Indebtedness pursuant to clause (1) of "Limitation on the Incurrence of Additional Indebtedness"; and
-
(3)
-
the
Company would be permitted to make an Investment at the time of Designation (assuming the effectiveness of such Designation and treating such
Designation as an Investment at the time of Designation) as a Restricted Payment pursuant to the first paragraph of "Limitation on Restricted Payments" or as a Permitted Investment in an
amount (the "
Designation Amount
") equal to the amount of the Company's or, following the PTP Conversion, the PTP Parent's or Company's Investment, as
applicable, in such Subsidiary or Restricted Entity on such date (whether made directly or through another Subsidiary thereof).
Neither
the Company nor any Restricted Entity will at any time:
-
(1)
-
provide
credit support for, subject any of its property or assets (other than the Capital Stock of any Unrestricted Entity) to the satisfaction of, or
Guarantee, any Indebtedness of any Unrestricted Entity (including any undertaking, agreement or instrument evidencing such Indebtedness);
-
(2)
-
be
directly or indirectly liable for any Indebtedness of any Unrestricted Entity; or
-
(3)
-
be
directly or indirectly liable for any Indebtedness which provides that the holder thereof may (upon notice, lapse of time or both) declare a default
thereon or cause the payment thereof to be accelerated or payable prior to its final scheduled maturity upon the occurrence of a default with respect to any Indebtedness of any Unrestricted Entity,
except,
in each case, for any non-recourse Guarantee given solely to support the pledge by the Company or any Restricted Entity of the Capital Stock of such Unrestricted Entity.
The
Company may revoke any Designation of a direct or indirect Subsidiary of the Company or, following the PTP Conversion, the PTP Parent may revoke any Designation of any direct or
indirect PTP Parent Subsidiary, as an Unrestricted Entity (a "
Revocation
") only if:
-
(1)
-
no
Default or Event of Default shall have occurred and be continuing at the time of and after giving effect to such Revocation; and
-
(2)
-
all
Liens and Indebtedness of such Unrestricted Entity outstanding immediately following such Revocation would, if Incurred at such time, have been
permitted to be Incurred for all purposes of the Indenture.
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The Designation of a direct or indirect Subsidiary of the Company or, following the PTP Conversion, of the PTP Parent, as an Unrestricted Entity shall be deemed
to include the Designation of all of the direct and indirect Subsidiaries of such Subsidiary. The Company will be required to promptly notify the Trustee of all such Designations and Revocations and
all Designations and Revocations must comply with the preceding provisions.
Notwithstanding
anything to the contrary herein, the Company and, following the PTP Conversion, the PTP Parent may not designate any direct or indirect Subsidiary of the PTP Parent as an
"
Unrestricted Entity
" under the Indenture if, at the time of such proposed designation, the Non-Guarantor Limitation would prohibit the Company or the
PTP Parent, as applicable, from designating such Subsidiary as a Non-Guarantor;
provided that
, for the avoidance of doubt, the foregoing restrictions
shall not apply to, and any calculation with respect to the Non-Guarantor Limitation shall not include, any Foreign Manager Owned Affiliates.
Limitation on Restricted Payments
The Company and, following the PTP Conversion, the PTP Parent each will not, and will not cause or permit any Restricted Entity under
their respective control to, directly or indirectly, take any of the following actions (each, a "
Restricted Payment
"):
-
(a)
-
declare
or pay any dividend or return of capital or make any distribution on or in respect of shares of Capital Stock of the Company or any Restricted
Entity to holders of such Capital Stock, other than:
-
(1)
-
dividends
or distributions payable in Qualified Capital Stock of, (i) prior to the PTP Conversion, the Company and, (ii) following the PTP
Conversion, the PTP Parent;
-
(2)
-
dividends
or distributions payable to the Company and/or a Restricted Entity; or
-
(3)
-
in
the case of a Restricted Entity that is not wholly-owned, dividends, distributions or returns of capital made on a
pro
rata
basis to the Company and the Restricted Entities, on the one hand, and the other holders of Capital Stock of a Restricted Entity, on the other hand (or on a less than pro
rata basis to any other holder);
-
(b)
-
purchase,
redeem or otherwise acquire or retire for value:
-
(1)
-
any
Capital Stock of, (i) prior to the PTP Conversion, the Company and, (ii) following the PTP Conversion, the PTP Parent (other than, in all
cases, purchases, redemptions, acquisitions or retirements made with Qualified Capital Stock of the Company or the PTP Parent, as applicable), or
-
(2)
-
any
Capital Stock of any Restricted Entity that is held by an Affiliate of the Company, except for:
-
(i)
-
Capital
Stock held by the Company or a Restricted Entity, or
-
(ii)
-
purchases,
redemptions, acquisitions or retirements for value of Capital Stock on a
pro rata
basis from the
Company and/or any Restricted Entities, on the one hand, and other holders of Capital Stock of a Restricted Entity, on the other hand, according to their respective percentage ownership of the Capital
Stock of such Restricted Entity;
-
(c)
-
make
any principal payment on, purchase, defease, redeem, prepay, decrease or otherwise acquire or retire for value, prior to any scheduled final maturity,
scheduled repayment or scheduled sinking fund payment, as the case may be, any Subordinated Indebtedness (other than (A) any inter-company Indebtedness between or among the Company and or any
Restricted Entity or (B) the principal payment on or the purchase, repurchase, redemption,
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defeasance,
retirement or other acquisition for value of Subordinated Indebtedness made in satisfaction of or anticipation of satisfying a sinking fund obligation, principal installment or final
maturity, in each case due within one year of the date of such payment, purchase, repurchase, redemption, defeasance, retirement or other acquisition), or
-
(d)
-
make
any Investment (other than Permitted Investments);
provided, however,
that any Permitted Investments
otherwise permitted under item (17) of the definition thereof made in a Foreign Manager Owned Affiliate shall not be a "Permitted Investment" for purposes hereof if the Consolidated Total
Senior Indebtedness to Adjusted Consolidated ENI EBITDA Ratio of the Company or, following the PTP Conversion, the PTP Parent, at the time of such Investment, is greater than 2.50 to 1.0;
if
at the time of the Restricted Payment, immediately after giving effect thereto:
-
(I)
-
a
Default or an Event of Default shall have occurred and be continuing;
-
(II)
-
the
Company or, following the PTP Conversion, the PTP Parent is not able to Incur at least $1.00 of additional Indebtedness pursuant to clause (1)
of "Limitation on the Incurrence of Additional Indebtedness;" or
-
(III)
-
the
aggregate amount (the amount expended for these purposes, if other than in cash, being the Fair Market Value of the relevant property as reasonably
determined in good faith by the Company) of the proposed Restricted Payment and all other Restricted Payments made subsequent to the Issue Date up to the date thereof shall exceed the sum
of:
-
(A)
-
with
respect to the period, treated as one accounting period, beginning on January 1, 2015 to the end of the most recent fiscal quarter for which
consolidated financial information of (i) prior to the PTP Conversion, the Company and, (ii) following the PTP Conversion, the PTP Parent, is available:
-
(x)
-
if
the cumulative Adjusted Consolidated ENI of the Company and/or the PTP Parent, as applicable and without duplication, for such period is a positive
amount, 50% of such cumulative Adjusted Consolidated ENI, or
-
(y)
-
if
the cumulative Adjusted Consolidated ENI of the Company and/or the PTP Parent, as applicable and without duplication, for such period is a negative
amount, minus 100% of such amount; plus
-
(B)
-
Following
the PTP Conversion, with respect to any period during which the equityholders of the PTP Parent are responsible for the payment of U.S. federal,
state and/or local income taxes (as the term income taxes is determined in accordance with GAAP) with respect to their
pro rata
share of the PTP
Parent's taxable income (as determined for U.S. tax purposes), for the primary purpose of offsetting the Company's good faith estimate of the tax liability of a holder of Capital Stock of the PTP
Parent as a result of holding such shares (applying, for the purposes of such good faith estimate, the tax liability of U.S. holders at the highest marginal rate in the U.S., giving effect to federal,
state and local rates), up to an additional 25% of cumulative Adjusted Consolidated ENI of the PTP Parent for such period, but only to the extent that the Consolidated Fixed Charge Coverage Ratio of
the PTP Parent for the most recently completed fiscal quarter of the PTP Parent is at least 2.5 to 1.0;
plus
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-
(C)
-
100%
of the aggregate net cash proceeds, Cash Equivalents or Fair Market Value of other property, received by (1) prior to the PTP Conversion, the
Company and, (2) following the PTP Conversion, the PTP Parent, from any Person from any:
-
(i)
-
contribution
on or subsequent to the Issue Date to the equity capital of the Company or the PTP Parent, as applicable, not representing an interest in
Disqualified Capital Stock;
-
(ii)
-
issuance
and sale (or, in the case of property, exchange) on or subsequent to the Issue Date of Qualified Capital Stock of the Company or the PTP Parent,
as applicable; or
-
(iii)
-
issuance
and sale on or subsequent to the Issue Date (and, in the case of Indebtedness of a Restricted Entity, at such time as it was a Restricted Entity)
of any Indebtedness of the Company or any Restricted Entity that has been converted into or exchanged for Qualified Capital Stock of the Company or, following the PTP Conversion, the PTP Parent,
Notwithstanding
the preceding paragraph, this covenant does not prohibit:
-
(1)
-
the
payment of any dividend or distribution or the consummation of any irrevocable redemption of Subordinated Indebtedness within 60 days after the
date of declaration of such dividend or distribution or giving of the redemption notice, as the case may be, if the dividend, distribution or redemption would have been permitted on the date of
declaration or notice pursuant to the preceding paragraph;
-
(2)
-
if
no Default or Event of Default has occurred and is continuing, the making of any Restricted Payment through the application of the net cash proceeds
received by the Company or, following the PTP Conversion, the PTP Parent, from a substantially concurrent sale of Qualified Capital Stock of the Company or the PTP Parent, as applicable, or a
contribution to the equity capital of the Company or the PTP Parent, as applicable, not representing an interest in Disqualified Capital Stock, in each case not received from a Restricted Entity;
provided
, that the value of any such Qualified Capital Stock used or the net proceeds of which are used to make a Restricted Payment pursuant to this
clause (2) shall be excluded from clause (III)(C) of the first paragraph of this covenant (and were not included therein at any time);
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-
(3)
-
if
no Default or Event of Default has occurred and is continuing, the voluntary prepayment, purchase, defeasance, redemption or other acquisition or
retirement for value of any Subordinated Indebtedness:
-
(x)
-
solely
through the use of, or through the application of net cash proceeds of a substantially concurrent sale, other than a sale to a Restricted Entity, of
Qualified Capital Stock of the Company or, following the PTP Conversion, the PTP Parent;
-
(y)
-
solely
through the use of Indebtedness permitted under clause (1) of "Limitation on the Incurrence of Additional Indebtedness;" or
-
(z)
-
from
Net Cash Proceeds from Asset Sales remaining after the application thereof as required by the covenant described under "Limitation on
Asset Sales and Sales of Subsidiary Stock" (including after making an Asset Sale Offer pursuant to such covenant and the application of the entire Asset Sale Offer Amount to purchase all new notes
tendered pursuant to such Asset Sale Offer);
provided
, that the value of any Qualified Capital Stock issued to prepay, purchase, defease, redeem or otherwise acquire or retire any Subordinated
Indebtedness and any net cash proceeds referred to above shall be excluded from clause (III)(C) of the first paragraph of this covenant (and were not included therein at any time);
-
(4)
-
repurchases,
retirements or other acquisitions by the Company or, following the PTP Conversion, the PTP Parent, of Capital Stock (other than Disqualified
Capital Stock) of the Company or the PTP Parent, as applicable, from any current, future or former employees, officers, directors or consultants of the Company or a Restricted Entity (or, in the case
of the death or disability of any of the foregoing, their respective authorized representatives), pursuant to any management equity plan or stock option plan or any other management or employee
benefit plan or agreement;
provided, however
, that the amount of any such repurchases, retirements or other acquisitions shall not exceed
$5.0 million in any fiscal year
plus
cash proceeds from any sale of Capital Stock (other than Disqualified Capital Stock) of the Company or,
following the PTP Conversion, the PTP Parent, to members of management, employees, officers, directors or consultants of the Company or any Restricted Entity that occurs after the Issue Date, to the
extent such proceeds have not otherwise been applied to the payment of Restricted Payments pursuant to paragraph (3) of this subsection;
-
(5)
-
the
repurchase of Capital Stock deemed to occur upon the exercise or vesting of stock options, warrants or phantom stock (or, following the PTP Conversion
with respect to the PTP Parent, similar rights in the PTP Parent's equity), in each case, to the extent such Capital Stock (i) represents all or a portion of the exercise price of those stock
options, warrants or phantom stock (or, following the PTP Conversion with respect to the PTP Parent, similar rights in the PTP Parent's equity) or (ii) are surrendered in connection with
satisfying any federal or state tax obligation incurred in connection with such exercise or vesting;
-
(6)
-
the
declaration and payment of dividends or distributions to holders of Disqualified Capital Stock of the Company or any Restricted Entity issued in
accordance with the covenant described under "Limitation on the Incurrence of Additional Indebtedness";
-
(7)
-
cash
payments in lieu of the issuance of fractional shares (i) in connection with the exercise of warrants, options or other securities convertible
into or exchangeable for Capital Stock of the Company or, following the PTP Conversion, the PTP Parent and (ii) arising out of stock dividends, splits, combinations or business combinations;
-
(8)
-
redemption
or other acquisition or retirement for value of any Subordinated Indebtedness of the Company or any Guarantor pursuant to and in accordance with
the terms of a "change of
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control"
covenant set forth in the indenture or other agreement pursuant to which such Subordinated Indebtedness is issued and such "change of control" covenant is similar to the Change of Control
Triggering Event provision included in the Indenture;
provided
, that the Company (or another Person) has repurchased all new notes required to be
repurchased by the Company under the caption "Change of Control Triggering Event" prior to the purchase, redemption or other acquisition or retirement for value of such Subordinated
Indebtedness pursuant to the applicable "change of control" covenant;
-
(9)
-
any
payments made to employees, directors or officers pursuant to any profit sharing plan, or similar arrangements, of the Company or any Restricted Entity,
established in the ordinary course of business, consistent with industry practices and on commercially reasonable terms under the circumstances existing at the time such profit sharing plan or similar
arrangement is established;
-
(10)
-
payments
or distributions to dissenting stockholders pursuant to applicable law in connection with a merger, consolidation or transfer of all or
substantially all of the Company's or, following the PTP Conversion, the PTP Parent's, property or assets that complies with the Indenture,
provided
that as a result of such merger, consolidation or transfer of all or substantially all of the Company's or PTP Parent's, as applicable, property or assets, the Company shall have made a Change of
Control Offer or Asset Sale Offer and all new notes tendered by Holders in connection therewith shall have been repurchased, redeemed or acquired in accordance with the Indenture;
-
(11)
-
fees
paid to DFR Holdings LLC in an amount up to $2.0 million per annum;
-
(12)
-
the
acquisition, in open market purchases or otherwise of the Company's or, following the PTP Conversion, the PTP Parent's, Capital Stock (other than
Disqualified Capital Stock) in an aggregate amount not to exceed $5.5 million,
plus
an amount in any fiscal year that does not exceed
$2.0 million;
provided
that up to $1.0 million of such annual excess amount that is not utilized by the Company or the PTP Parent, as
applicable, to acquire Capital Stock of the Company or the PTP Parent, as applicable, in any fiscal year may be carried forward to the immediately succeeding year; and
-
(13)
-
other
Restricted Payments in an aggregate amount taken together with all other Restricted Payments made pursuant to this clause (13) not to exceed
the Maximum Other Restricted Payment Amount, as of the date of determination.
In
determining the aggregate amount of Restricted Payments made subsequent to the Issue Date for purposes of clause (III) above, amounts expended pursuant to clauses (1)
(without duplication for the declaration of the relevant dividend), (6) and (8) above shall be included in such calculation and amounts expended pursuant to clauses (2), (3), (4),
(5), (7) and (9) through (13) above shall not be included in such calculation.
In
the event that any Restricted Payment or other payment, purchase, defeasance, redemption, retirement or other acquisition described in this covenant meets the criteria of more than
one of the types of Restricted Payments or other payments, purchase, defeasances, redemptions, retirements or other acquisitions described in this covenant (including any subclause hereof), the
Company, in its sole discretion, will be permitted to classify such item on the date of payment, and will only be required to include the amount and type of such item in one of such clauses (or
subclauses) although the Company may divide and classify an item in one or more of the clauses (or subclauses) and may later re-divide or reclassify all or a portion of such item in any manner that
complies with this covenant.
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Limitation on Asset Sales and Sales of Subsidiary Stock
The Company and, following the PTP Conversion, the PTP Parent each will not, and will not cause or permit any Restricted Entity under
their respective control to, consummate an Asset Sale unless:
-
(a)
-
the
Company or the applicable Restricted Entity, as the case may be, receives consideration at the time of the Asset Sale at least equal to the Fair Market
Value of the assets or Capital Stock sold or otherwise disposed of; and
-
(b)
-
at
least 75% of the consideration received by the Company or the Restricted Entity, as the case may be, in the Asset Sale shall be in the form of Cash or
Cash Equivalents (defined below) received at the time of such Asset Sale;
provided
, that for the purposes of this covenant, the following will be deemed
to be "
Cash Equivalents
":
-
(1)
-
Cash
Equivalents (as defined herein);
-
(2)
-
the
assumption by the payor of the consideration of any liabilities that are included on the balance sheet (other than Subordinated Indebtedness) of the
Company or any Restricted Entity and the release of the Company or such Restricted Entity from all liability in connection therewith;
-
(3)
-
any
securities, notes or other obligations or assets received by the Company or any Restricted Entity from the payor of the consideration that are converted
by the Company or such Restricted Entity into Cash or Cash Equivalents within 180 days of the receipt thereof (subject to ordinary settlement periods) to the extent of Cash or Cash Equivalents
received in that conversion; and
-
(4)
-
the
Fair Market Value of (i) any Capital Stock of a Person engaged in a Permitted Business that will become, upon purchase, a Restricted Entity or
(ii) assets to be used (or intended to be used) by the Company or any Restricted Entity in a Permitted Business; and
-
(5)
-
any
Designated Non-cash Consideration received by the Company or any of the Restricted Entities in such Asset Sale having an aggregate Fair Market Value (as
determined in good faith by the Company), taken together with all other Designated Non-cash Consideration received pursuant to this clause (5) that is at that time outstanding, not to exceed
$25.0 million (with the Fair Market Value of each item of Designated Non-cash Consideration being measured at the time received without giving effect to subsequent changes in value).
The
Company or any Restricted Entity, as the case may be, may apply the Net Cash Proceeds of any such Asset Sale within 365 days thereof to:
-
(a)
-
repay
any Senior Indebtedness of the Company or any Guarantor;
-
(b)
-
make
capital expenditures in a Permitted Business;
-
(c)
-
an
Investment in (1) assets (except for current assets as determined in accordance with GAAP or Capital Stock) to be used by or useful to (or
intended to be used by or useful to) the Company or any Restricted Entity in a Permitted Business, or (2) all or substantially all of the assets of, or Capital Stock of, a Person engaged in,
used in or useful to, a Permitted Business that will become, or the assets of which will be contributed to upon purchase, a Restricted Entity;
-
(d)
-
an
Investment in assets (except for current assets as determined in accordance with GAAP or Capital Stock) or properties that replace the assets that are
the subject of the corresponding Asset Sale;
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-
(e)
-
enter
into a binding commitment with a Person, other than the Company and the Restricted Entities, to apply such Net Cash Proceeds pursuant to
clause (b), (c) or (d) above,
provided
, that such binding commitment shall be subject only to customary conditions and the
applicable purchase shall be consummated within 180 days following the expiration of the aforementioned 365-day period;
-
(f)
-
permanently
reduce secured Indebtedness under one or more Credit Facilities; and/or
-
(g)
-
to
make any Permitted Investments permitted by clauses (12), (13), (14), (15) and (16) of the definition thereof.
To
the extent all or a portion of the Net Cash Proceeds of any Asset Sale are not applied within 365 days of the Asset Sale as described in clause (a) through (g) of
the immediately preceding paragraph (or, with respect to clause (e), such later date as permitted thereunder), such amount shall constitute "
Excess
Proceeds.
"
When
the aggregate amount of Excess Proceeds exceeds $25.0 million, the Company will make an offer to all Holders of new notes to purchase notes (the
"
Asset Sale Offer
"), at a purchase price equal to 100% of the outstanding principal amount of the new notes to be purchased, plus accrued and unpaid
interest thereon, to the date of purchase (the "
Asset Sale Offer Amount
"). The Company will purchase pursuant to an Asset Sale Offer from all tendering
Holders on a
pro rata
basis, and, at the Company's option, on a
pro rata
basis with the holders of any
other Senior Indebtedness or pari passu Indebtedness with similar provisions requiring the Company to offer to purchase the other Senior Indebtedness or pari passu Indebtedness with the proceeds of
Asset Sales, that principal amount (or accreted value in the case of Indebtedness issued with original issue discount) of new notes and the other Senior Indebtedness or pari passu Indebtedness to be
purchased equal to such unapplied Net Cash Proceeds. The Company may satisfy its obligations under this covenant with respect to the Net Cash Proceeds of an Asset Sale by making an Asset Sale Offer
prior to the expiration of the relevant period for the application of such Net Cash Proceeds set forth above. Pending application in accordance with this covenant, Net Cash Proceeds may be invested in
Cash Equivalents.
Each
notice of an Asset Sale Offer will be delivered in accordance with the Indenture to the record Holders as shown on the register of Holders within 20 days following such
365
th
day (or any later date permitted by clause (e) above), with a copy to the Trustee offering to purchase the new notes as described above. Each notice of an Asset Sale
Offer will state, among other things, the purchase date, which must be no earlier than 30 days nor later than 60 days from the date of notice, other than as may be required by law (the
"
Asset Sale Offer Payment Date
"). Upon receiving notice of an Asset Sale Offer, Holders may elect to tender their notes in whole or in part in amounts
of $1,000 and in integral multiples of $1,000 in excess thereof for cash.
Holders
electing to tender their notes shall deliver a notice of election in writing to the Company in accordance with the Indenture at least 10 days before the Asset Sale Offer
Payment Date.
On
the Business Day prior to the Asset Sale Offer Payment Date, the Company will, to the extent lawful, deposit with the Trustee, as paying agent, funds in an amount equal to the Asset
Sale Offer Amount in respect of all new notes or portions thereof so tendered. On the Asset Sale Offer Payment Date, the Company will, to the extent lawful:
-
(1)
-
accept
for payment all new notes or portions thereof properly tendered pursuant to the Asset Sale Offer; and
-
(2)
-
deliver
or cause to be delivered to the Trustee an Officers' Certificate stating the aggregate principal amount of new notes or portions thereof being
purchased by the Company.
To
the extent Holders and holders of other Senior Indebtedness or pari passu Indebtedness, if any, which are the subject of an Asset Sale Offer properly tender and do not withdraw notes
or the other
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Senior
Indebtedness or pari passu Indebtedness in an aggregate amount exceeding the amount of Excess Proceeds, the Company will purchase the new notes, the other Senior Indebtedness or pari passu
Indebtedness, if any, on a
pro rata
basis (based on amounts tendered). If only a portion of a new note is purchased pursuant to an Asset Sale Offer, a
new note in a principal amount equal to the portion thereof not purchased will be issued in the name of the Holder thereof upon cancellation of the original note (or appropriate adjustments to the
amount and beneficial interests in a global note will be made, as appropriate). New notes (or portions thereof) purchased pursuant to an Asset Sale Offer will be cancelled and cannot be reissued.
The
Company will comply with the requirements of Rule 14e-1 under the Exchange Act and any other applicable securities laws and regulations, to the extent that such laws and
regulations are applicable in connection with the purchase of new notes pursuant to an Asset Sale Offer. To the extent that the provisions of any applicable securities laws or regulations conflict
with the "Asset Sale" provisions of the Indenture, the Company will comply with these laws and regulations and will not be deemed to have breached its obligations under the "Asset Sale" provisions of
the Indenture by doing so.
Upon
completion of an Asset Sale Offer, the amount of Excess Proceeds will be reset at zero. Accordingly, to the extent that the aggregate amount of new notes and other Indebtedness
tendered pursuant to an Asset Sale Offer is less than the aggregate amount of Excess Proceeds, the Company and/or the Restricted Entities may use any remaining Excess Proceeds for any purpose not
otherwise prohibited by the Indenture.
Limitations on Liens
The Company and, following the PTP Conversion, the PTP Parent each will not, and will not cause or permit any Restricted Entity under
their respective control to, directly or indirectly, create, incur, assume or suffer to exist any Lien that secures obligations under any Indebtedness on any asset or property of the Company or any
Restricted Entity, or any income or profits therefrom, or assign or convey any right to receive income therefrom, unless:
-
(1)
-
in
the case of Liens securing Subordinated Indebtedness of the Company, the new notes are secured by a Lien on such property, assets or proceeds of the
Company;
-
(2)
-
in
the case of Liens securing Subordinated Indebtedness of any Guarantor, the Guarantee of such Guarantor is secured by a Lien on such property, assets or
proceeds of such Guarantor;
-
(3)
-
in
the case of Liens securing Indebtedness (other than Subordinated Indebtedness) of the Company, the new notes are equally and ratably secured by a Lien on
such property, assets or proceeds of the Company; and
-
(4)
-
in
the case of Liens securing Indebtedness (other than Subordinated Indebtedness) of any Guarantor, the Guarantee of such Guarantor is equally and ratably
secured by a Lien on such property, assets or proceeds of such Guarantor.
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-
(iii)
-
Liens
securing Indebtedness permitted to be incurred pursuant to clauses (a), (b), (c), (d) and (k) of the definition of "Permitted
Indebtedness" and Liens securing any Refinancing Indebtedness permitted to be incurred pursuant to clause (h) of such definition provided that the Indebtedness being so Refinanced was permitted
to be secured Indebtedness under the Indenture; or
-
(iv)
-
Permitted
Liens.
Any
Lien created for the benefit of the Holders pursuant to this covenant shall be deemed automatically and unconditionally released and discharged upon the release and discharge of the
relevant Liens described in clauses (1), (2), (3) and (4) above.
Limitation on Merger, Consolidation and Sale of Assets
-
(1)
-
The
Company will not, in one or a series of transactions, consolidate or merge with or into any Person or convey, lease, transfer or otherwise dispose of
all or substantially all of its properties, assets or net sales to any Person or permit any Person to merge with or into it unless:
-
(a)
-
the
Company is the continuing entity, or the Person, if other than the Company, formed by such consolidation or into which the Company is merged, or the
Person that acquired by sale, assignment, conveyance, transfer, lease or other disposition the properties or assets of the Company and its Subsidiaries substantially as an entirety (for purposes of
this clause (1), the "
Surviving Entity
"), will be organized and validly existing under the laws of the United States, and shall expressly assume
(jointly and severally with the Company, unless the Company shall have ceased to exist as part of such merger, consolidation or amalgamation), by a supplemental indenture (the form and substance of
which shall be previously approved by the Trustee on the basis that it contains substantially the same terms and conditions as the new notes and the Indenture), all of the Company's obligations under
the new notes and the Indenture;
-
(b)
-
the
Surviving Entity (jointly and severally with the Company unless the Company shall have ceased to exist as a result of such merger, consolidation or
amalgamation) agrees to indemnify each Holder against any tax, assessment or governmental charge thereafter imposed on such Holder solely as a consequence of such consolidation, merger, conveyance,
transfer or lease with respect to the payment of principal of, or interest on, the new notes;
-
(c)
-
immediately
after giving effect to the transaction or series of transactions, no Default or Event of Default has occurred and is continuing;
-
(d)
-
immediately
after giving effect to the transaction or series of transactions, the Company (or, following the PTP Conversion, the PTP Parent) or the
Surviving Entity, as the case may be, could Incur at least $1.00 of additional Indebtedness without violating the covenant described under "Limitation on the Incurrence of Additional
Indebtedness;"
-
(e)
-
the
Company has delivered to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officers' Certificate and an Opinion of Counsel,
each stating that the transaction and the supplemental indenture or Guarantee of the new notes, if applicable, comply with the Indenture and that all conditions precedent provided for in the Indenture
and relating to such transaction have been complied with; and
-
(f)
-
the
Company shall have delivered notice of any such transaction to the Rating Agencies then rating the new notes (which notice shall contain a description
of such merger, consolidation or conveyance).
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-
(2)
-
Each
Guarantor will not, and the Company and, following the PTP Conversion, the PTP Parent, will not cause or permit any Guarantor to, consolidate with or
merge into, or sell or dispose of all or substantially all of its assets or Capital Stock to, any Person (other than the Company) that is not a Guarantor unless:
-
(a)
-
the
Guarantor is the continuing entity, or the Person, if other than the Guarantor, formed by such consolidation or into which the Guarantor is merged, or
the Person that acquired by sale, assignment, conveyance, transfer, lease or other disposition the properties or assets of the Guarantor and its Subsidiaries substantially as an entirety (for purposes
of this clause (2), the "
Surviving Entity
"), the Surviving Entity will be organized and validly existing under any laws of the jurisdiction in
which such Surviving Entity was organized, and shall expressly assume (jointly and severally with the other Guarantors or with the other Surviving Entities if such other Guarantors have ceased to
exist as part of such merger, consolidation or amalgamation), by a supplemental indenture (the form and substance of which shall be previously approved by the Trustee on the basis that it contains
substantially the same terms and conditions as exist under the current Indenture), all of such Guarantor's obligations under the new notes and the Indenture;
-
(b)
-
immediately
after giving effect to the transaction or series of transactions, no Default or Event of Default has occurred and is continuing; and
-
(c)
-
the
applicable Guarantor has delivered to the Trustee, in form and substance reasonably satisfactory to the Trustee, an Officers' Certificate and an Opinion
of Counsel, each stating that the transaction and the supplemental indenture or Guarantee of the new notes, if applicable, comply with the Indenture and that all conditions precedent provided for in
the Indenture and relating to such transaction have been complied with.
-
(3)
-
Notwithstanding
anything to the contrary in the foregoing clauses (1) and (2), so long as no Default under the Indenture or the new notes shall have
occurred and be continuing at the time a transaction described in clause (1) or (2) is consummated or would result therefrom:
-
(a)
-
the
Company may merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of assets to any Subsidiary of the Company in cases in
which the Company is the surviving entity in such transaction and such transaction would not have a material adverse effect on the Company and its Subsidiaries taken as a whole, it being understood
that if the Company is not the surviving entity, the Company shall be required to comply with the requirements set forth in clause (1) above; or
-
(b)
-
any
Subsidiary of the Company (other than a Guarantor) may merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of assets to,
any Person (other than the Company or any Restricted Entity) if such transaction would not have a material adverse effect on the Company or, following the PTP Conversion, the PTP Parent, in each case
together with its Subsidiaries taken as a whole; or
-
(c)
-
any
Subsidiary of the Company or following the PTP Conversion, any PTP Parent Subsidiary (other than a Guarantor, except when such Guarantor is the
surviving entity and continues as a Guarantor) may merge or consolidate with or into, or convey, transfer, lease or otherwise dispose of assets to, any other Restricted Entity; or
-
(d)
-
any
Subsidiary of the Company or, following the PTP Conversion, any PTP Parent Subsidiary (other than a Guarantor) may liquidate or dissolve if the Company
determines in good faith that such liquidation or dissolution is in the best interests of the Company, and would not result in a material adverse effect on the Company or, following the PTP
Conversion, the PTP Parent, in each case together with its Subsidiaries taken as a whole.
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Limitation on Transactions with Affiliates
-
(1)
-
The
Company and, following the PTP Conversion, the PTP Parent each will not, and will not cause or permit any Restricted Entity under their respective
control to, directly or indirectly, enter into any transaction or series of related transactions (including, without limitation, the purchase, sale, lease or exchange of any property or the rendering
of any service) with, or for the benefit of, any of its Affiliates, including for the avoidance of doubt, any Investment Vehicle that is an Affiliate of the Company or, following the PTP Conversion,
the PTP Parent (each, an "
Affiliate Transaction
") involving aggregate consideration in excess of $2.5 million, unless:
-
(a)
-
the
terms of such Affiliate Transaction are no less favorable than those that could reasonably be expected to be obtained in a comparable transaction at
such time on an arm's-length basis from a Person that is not an Affiliate of the Company;
-
(b)
-
in
the event that such Affiliate Transaction involves aggregate payments, or transfers of property or services with a Fair Market Value, in excess of
$10.0 million, the terms of such Affiliate Transaction will be approved by a majority of the members of the Board of Directors of the Company, the approval to be evidenced by an Officers'
Certificate stating that the Board of Directors has determined that such transaction complies with the preceding provisions; and
-
(c)
-
in
the event that such Affiliate Transaction involves aggregate payments, or transfers of property or services with a Fair Market Value, in excess of
$20.0 million, (i) the terms of such Affiliate Transaction will be approved by a majority of the members of the Board of Directors of the Company, the approval to be evidenced by an
Officers' Certificate stating that the Board of Directors has determined that such transaction complies with the preceding provisions, and (ii) the Company will, prior to the consummation
thereof, obtain a favorable opinion as to the fairness of such Affiliate Transaction to the Company and the relevant Restricted Entity (if any) from a financial point of view from an Independent
Financial Advisor and deliver the same to the Trustee.
-
(2)
-
Paragraph (1)
above will not apply to:
-
(a)
-
Affiliate
Transactions with or among the Company and any Restricted Entity or between or among Restricted Entities;
-
(b)
-
reasonable
fees and compensation paid to and any indemnity provided on behalf of, officers, directors, employees, consultants or agents of the Company or
any Restricted Entity as determined in good faith by the Company;
-
(c)
-
Affiliate
Transactions (i) in existence on the Issue Date and (ii) in existence immediately following and as a result of the completion of the
PTP Conversion, or necessary or advisable to complete the PTP Conversion as described under "PTP Conversion," in each case, as the Company has determined in good faith would not result in
a material adverse effect to the interests of the Holders, or any amendment, modification or replacement of such agreement (so long as such amendment, modification or replacement is not materially
more disadvantageous to the Company and the Restricted Entities or the Holders, taken as a whole, than the original agreement as in effect on the Issue Date);
-
(d)
-
any
Restricted Payments made in compliance with "Limitation on Restricted Payments" or any Permitted Investment;
-
(e)
-
loans
and advances to officers, directors and employees of the Company or any Restricted Entity customary in the industry in which the Company operates and
related to the business activities of the Company and the Restricted Entities;
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-
(f)
-
any
employment agreement or arrangement, profit sharing, employee benefit plan, officer or director indemnification agreement, issuance or grant of
securities or stock options, consulting agreement or arrangement, restrictive covenant agreement, incentive compensation plan, expense reimbursement arrangement or any similar arrangement entered into
by the Company or any of the Restricted Entities in the ordinary course of business or consistent with past practice and payments pursuant thereto;
-
(g)
-
any
transaction permitted by the covenant "Limitations on Merger, Consolidation and Sale of Assets";
-
(h)
-
transactions
between the Company or any Restricted Subsidiary or, following the PTP Conversion, between the PTP Parent or any other Restricted Entity, on
the one hand, and any Investment Vehicle managed or advised by the Company or any of the Restricted Entities, on the other hand, in each case so long as such transactions are (x) in the
ordinary course of business for the Company, the PTP Parent, any Restricted Subsidiary or any Restricted Entity, as the case may be, including collateral management agreements and fee and expense
arrangements, (y) on commercial terms generally consistent with industry standards for transactions with investment vehicles of similar types, including concessions to improve the marketability
of the Investment Vehicle, and (z) on commercial terms that, in each case, the Company has determined in good faith would not result in a material adverse effect to the interests of the
Holders; and
-
(i)
-
transactions
with customers, clients, suppliers or purchasers or sellers of goods or services, in each case in the ordinary course of business and otherwise
in compliance with the terms of the Indenture, which are fair to the Company or the Restricted Entities (as applicable), or are on terms at least as favorable as might reasonably have been obtained at
such time from an unaffiliated party, in the good faith judgment of the Company.
Funding into Reserve Account upon a Key Person Trigger Event
Upon the occurrence of a Key Person Trigger Event, the Company or, following the PTP Conversion, the PTP Parent and/or the Company,
shall deposit on each date that is five Business Days after the last date for delivery of quarterly or annual financial statements (as applicable) by the Company or, following the PTP Conversion, the
PTP Parent, an amount equal to fifty percent (50%) of Excess ENI Cash Flow for the quarterly period covered by such financial statements into a segregated account maintained by the Trustee exclusively
for such purposes (the "
Reserve Account
"). If, for two consecutive fiscal quarters after the Company or, following the PTP Conversion, the PTP Parent,
has commenced making such deposits, the Consolidated Total Senior Indebtedness to Adjusted Consolidated ENI EBITDA Ratio of the Company or, following the PTP Conversion, the PTP Parent, is equal to or
less than 2.5 to 1.0 (reducing Consolidated Indebtedness by all amounts credited to the Reserve Account for purposes of determining Consolidated Total Senior Indebtedness), then the obligation to
deposit such amounts into the Reserve Account shall cease and the Company or, following the PTP Conversion, the PTP Parent, may request the Trustee to retransfer to it (and the Trustee shall cause to
be retransferred as promptly as practicable after receipt of any documents required under the Indenture) amounts on deposit in the Reserve Account;
provided
that such withdrawal does not result in a
Consolidated Total Senior Indebtedness to Adjusted Consolidated ENI EBITDA Ratio in excess of 2.5 to
1.0 after giving effect to such withdrawal. Any amounts in the Reserve Account not previously withdrawn in accordance with the prior sentence shall be applied in satisfaction of the outstanding
principal, premium, if any or interest due (in the order provided for in the Indenture) on the new notes on the first to occur of (i) the Maturity Date, whether by acceleration or otherwise and
(ii) the date of any required repurchase by the Company of the new notes following a Change in Control Triggering Event. Notwithstanding the foregoing, the Company may instruct the Trustee to
apply amounts in the Reserve Account to an optional redemption of the new notes;
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provided,
that the Consolidated Total Senior Indebtedness to Adjusted Consolidated ENI EBITDA Ratio of the Company or, following the PTP Conversion, the PTP Parent, does not exceed 2.5 to 1.0 after
giving effect to such optional redemption.
Maintenance of Company Existence
The Company and, following the PTP Conversion, the PTP Parent shall, and shall each cause any Restricted Entity under their respective
control to, (a) maintain in effect its existence and all registrations necessary therefor (except to the extent permitted under "Limitation on Merger, Consolidation or Sale of
Assets"), (b) take all actions to maintain all rights, privileges, titles to property or franchises necessary in the normal conduct of its business, and (c) keep all its property used or
useful in the conduct of its business in good working order and condition except where the failure to so comply would not have a material adverse effect on the Company's and the Restricted Entities'
business, assets, operations or financial condition taken as a whole;
provided
that this provision shall not require the Company or the PTP Parent, as
applicable, to maintain any such right, privilege, title to property or franchises or to preserve the corporate existence of any Restricted Entity, if such Restricted Entity determines in good faith
that the maintenance or preservation thereof is no longer necessary or desirable in the conduct of its business; and
further provided
that, for the
avoidance of doubt, this provision shall not prevent the PTP Parent from effecting the PTP Parent Conversion.
Events of Default, Notice and Waiver
If an Event of Default with respect to the new notes occurs and is continuing, the Trustee or the Holders of at least 30% in aggregate
principal amount of the outstanding notes may declare, by notice as provided in the Indenture, the principal amount of all the new notes due and payable immediately. However, in the case of an Event
of Default involving certain events in bankruptcy, insolvency or reorganization, acceleration will occur automatically. If all Events of Default with respect to the new notes have been cured or
waived, and all amounts due otherwise than because of the acceleration have been paid or deposited with the Trustee, the Holders of a majority in aggregate principal amount of the outstanding notes
may rescind the acceleration and its consequences.
The
Holders of a majority in aggregate principal amount of the new notes may waive any past Default with respect to the new notes, and any Event of Default arising from a past Default,
except in the case of (i) a Default in the payment of the principal of, or any premium or interest on, any new note; or (ii) a Default in respect of a covenant or provision that cannot
be amended or modified without the consent of each of the affected Holders.
"
Event of Default
" means the occurrence and continuance of any of the following events with respect to the new
notes:
-
(1)
-
default
in the payment of any interest payable in respect of any new note, when such interest becomes due and payable, and continuance of such default for a
period of 10 days;
-
(2)
-
default
in the payment of the principal of and any premium on any new note when it becomes due and payable at its Maturity;
-
(3)
-
default
in the performance or breach of any covenant or warranty of the Company or any Restricted Entity in the Indenture or the new notes, and continuance
of such default or breach for a period of 45 days;
-
(4)
-
any
Event of Default as defined in any mortgage, indenture or instrument under which there may be issued, or by which there may be secured or evidenced, any
Indebtedness for money borrowed of the Company or any Restricted Entity, whether such Indebtedness now exists or shall hereafter be created, shall happen and shall result in a principal amount in
excess of $10.0 million of Indebtedness becoming or being declared due and payable prior to the date
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on
which it would otherwise have become due and payable, and such acceleration shall not have been rescinded or annulled, or such Indebtedness shall not have been discharged, within a period of
15 days;
provided
that such grace period shall not apply if such Indebtedness was Incurred in violation of the Company's covenants contained in
the Indenture;
-
(5)
-
one
or more final judgments or orders shall be rendered against the Company, any Guarantor or any Restricted Entity that is a Significant Subsidiary (or
following the PTP Conversion, the PTP Parent to the extent it meets the financial criteria for being a Significant Subsidiary) for the payment of money, either individually or in any aggregate amount,
in excess of $10.0 million (exclusive of judgment amounts covered by insurance or otherwise secured by adequate credit assurances, as determined by the Trustee) and shall not be discharged and
either (a) an enforcement proceeding shall have been commenced by any creditor upon such judgment or order, or (b) there shall have been a period of 60 consecutive days during which a
stay of enforcement of such judgment or order, by reason of a pending appeal or otherwise, was not in effect; and
-
(6)
-
certain
events in bankruptcy, insolvency or reorganization of the Company.
A
Default under clause (3) or (4) is not an Event of Default until the Trustee or the Holders of at least 30% in aggregate principal amount of the outstanding notes notify
the Company in writing of the Default, and the Company does not cure the Default within the time specified in such clause after receipt of such notice.
When
a Default under clause (3) or (4) is cured or remedied within the specified period, it ceases to exist.
If
an Event of Default (other than an Event of Default with respect to the Company specified in clause (6) above) occurs and is continuing, the Trustee, by written notice to the
Company, or the Holders of at least 30% in aggregate principal amount of the outstanding notes, by written notice to the Company and the Trustee, may declare all unpaid principal of and accrued
interest on the new
notes then outstanding to be due and payable (the "
Default Amount
"). Upon a declaration of acceleration, such amount shall be due and payable
immediately.
If
an Event of Default with respect to the Company specified in clause (6) above occurs, the Default Amount shall ipso facto become and be immediately due and payable without any
declaration or other act on the part of the Trustee or any holder.
If
an Event of Default occurs and is continuing, promptly following receipt of written notice or actual knowledge thereof, the Company shall deliver to the Trustee an Officers'
Certificate setting forth the details of such Event of Default, and the Trustee on behalf of the Issuer shall promptly notify the Holders in writing.
Under
certain circumstances, the Holders of a majority in aggregate principal amount of the new notes then outstanding may rescind an acceleration with respect to such notes and its
consequences.
In
case an Event of Default occurs and is continuing, the Trustee will be under no obligation to exercise any of the rights or powers under the Indenture at the request or direction of
any of the Holders unless such Holders have offered to the Trustee indemnity or security satisfactory to it against any loss, liability or expense. Except to enforce the right to receive payment of
principal, premium (if any) or interest (if any) when due, no Holder may pursue any remedy with respect to the Indenture or the new notes unless (i) such Holder has previously given the Trustee
notice that an Event of Default is continuing, (ii) Holders of at least 30% in principal amount of the outstanding notes have requested the Trustee to pursue the remedy, (iii) such
Holders have offered the Trustee security or indemnity against any loss, liability or expense, (iv) the Trustee has not complied with such request within 60 days after the receipt of the
request and the offer of security or indemnity and (v) the Holders of a majority
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in
principal amount of the outstanding notes have not given the Trustee a direction inconsistent with such request within such 60-day period. Subject to certain restrictions, the Holders of a majority
in principal amount of the outstanding notes are given the right to direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or of exercising any trust or
power conferred on the Trustee. The Trustee, however, may refuse to follow any direction that conflicts with law or the Indenture or that the Trustee determines is unduly prejudicial to the rights of
any other Holder or that would involve the Trustee in personal liability.
Modification and Waiver
The Indenture may be modified or amended without the consent of any Holder of outstanding notes for any of the following
purposes:
-
(i)
-
to
evidence that another entity is our successor and has assumed our obligations with respect to the new notes;
-
(ii)
-
to
add to our covenants or to add guarantees of any Person (including the PTP Parent) for the benefit of the Holders or to surrender any of our rights or
powers under the Indenture;
-
(iii)
-
to
add any Events of Default;
-
(iv)
-
to
make any amendment to the provisions of the Indenture relating to the transfer and legending of the new notes as permitted under the Indenture,
including, without limitation, to facilitate the issuance and administration of the new notes so long as in any such case the interests of the Holder of the new notes are not adversely affected in any
material respect;
-
(v)
-
to
secure the new notes;
-
(vi)
-
to
provide for the appointment of a successor Trustee with respect to the new notes;
-
(vii)
-
to
make certain changes to the Indenture to provide for the issuance of additional notes;
-
(viii)
-
to
cure any ambiguity, defect or inconsistency in the Indenture or to make any other provisions with respect to matters or questions arising under the
Indenture, so long as the action does not adversely affect the interests of the Holders in any material respect, including actions with respect to the PTP Conversion;
-
(ix)
-
to
add a Guarantee of the new notes or to release a Guarantor upon its sale or Designation as an Unrestricted Entity or other permitted release from its
Guarantee, in each case, in accordance with the Indenture;
-
(x)
-
to
provide for the assumption of the Company's or any Guarantor's obligations to the Holders;
-
(xi)
-
to
provide for the issuance of exchange notes registered with the SEC or private exchange notes, which are identical to exchange notes except that they are
not freely transferable;
-
(xii)
-
to
make any amendment to the provisions of the Indenture relating to the transfer and legending of new notes as permitted by the Indenture, including,
without limitation, to facilitate the issuance and administration of the new notes;
provided, however
, that (i) compliance with the Indenture as
so amended would not result in notes being transferred in violation of the Securities Act or any applicable securities law and (ii) such amendment does not materially and adversely affect the
rights of Holders to transfer notes; or
-
(xiii)
-
to
conform the text of the Indenture or the new notes to any provision of this "Description of the New Notes."
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The
Indenture may be modified or amended in respect of the new notes with the consent of the Holders of a majority in aggregate principal amount of the outstanding notes. However, unless
each
Holder to be affected by the proposed change consents, no modification or amendment may:
-
(i)
-
change
the Stated Maturity of the principal of, or any installment of principal of, or interest on, any new note;
-
(ii)
-
reduce
the principal amount of, or the rate or amount of interest on, or any premium payable with respect to, any new note;
-
(iii)
-
change
the places or currency of payment of the principal of, or any premium or interest on, any new note;
-
(iv)
-
impair
the right to sue for the enforcement of any payment of principal of, or any premium or interest on, any new note on or after the date the payment is
due; or
-
(v)
-
reduce
the percentage in aggregate principal amount of outstanding notes necessary to:
-
(A)
-
modify
or amend the Indenture,
-
(B)
-
waive
any past default or compliance with certain restrictive provisions, or
-
(C)
-
constitute
a quorum or take action at a meeting.
The
Holders of a majority in aggregate principal amount of the outstanding notes may waive our obligation to comply with certain restrictive provisions applicable to such notes.
Defeasance of Certain Coven
a
nts
The Company at any time may terminate all its obligations under the new notes and the Indenture and all obligations of the Guarantors
with respect to the Guarantees except for certain obligations, including those respecting the Defeasance Trust (as defined below) and obligations to register the transfer or exchange of the new notes,
to replace mutilated, destroyed, lost or stolen notes and to maintain a registrar and paying agent in respect of the new notes. This is known as "
Legal
Defeasance
." The Company at any time may terminate its obligations under the covenants described under "Limitations on Liens" above and the operation of
clause (3) or (4) described under "Events of Default" above. This is known as "
Covenant Defeasance
."
The
Company may exercise its Legal Defeasance option notwithstanding its prior exercise of its Covenant Defeasance option. If the Company exercises its Legal Defeasance option, payment
of the new notes may not be accelerated because of an Event of Default with respect thereto. If the Company exercises its Covenant Defeasance option, payment of the new notes may not be accelerated
because of an Event of Default specified in clause (3) or (4) described under "Events of Default" above.
In
order to exercise either defeasance option, the Company must irrevocably deposit in trust (the "
Defeasance Trust
") with the Trustee
money or Government Obligations for the payment of principal and interest (if any) on the new notes to redemption or maturity, as the case may be, and must comply with certain other conditions,
including (unless the new notes will mature or be redeemed within 30 days) delivering to the Trustee an opinion of counsel to the effect that Holders will not recognize income, gain or loss for
federal income tax purposes as a result of such deposit and defeasance and will be subject to federal income tax on the same amount and in the same manner and at the same times as would have been in
the case if such deposit and defeasance had not occurred, and, in the case of Legal Defeasance only, such opinion of counsel must be based on a ruling of the Internal Revenue Service or other change
in applicable federal income tax law.
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Satisfaction and Discharge
The Indenture will be discharged and will cease to be of further effect as to all of the new notes issued thereunder (other than the
Company's obligations to register the transfer or exchange of new notes; to replace stolen, lost or mutilated notes; to maintain paying agencies; and to hold money for payment in trust),
when:
-
(i)
-
either
-
(a)
-
all
new notes that have been authenticated, except lost, stolen or destroyed notes that have been replaced or paid and notes for whose payment money has
been deposited in trust and thereafter repaid to the Company, have been delivered to the Trustee for cancellation; or
-
(b)
-
all
new notes that have not been delivered to the Trustee for cancellation have become due and payable by reason of the mailing of a notice of redemption or
otherwise or will become due and payable within one year or are to be called for redemption within one year under arrangements satisfactory to the Trustee for the giving of notice of redemption by the
Trustee in the name, and at the expense of the Company, and the Company has irrevocably deposited or caused to be deposited with the Trustee as trust funds in trust solely for the benefit of the
Holders, cash in U.S. dollars, Government Obligations, or a combination of cash in U.S. dollars and Government Obligations, in such amounts as will be sufficient without consideration of any
reinvestment of interest, to pay and discharge the entire indebtedness on the new notes not delivered to the Trustee for cancellation for principal, premium, if any, and accrued interest to the date
of maturity or redemption;
-
(ii)
-
the
Company has paid or caused to be paid all sums payable by it under the Indenture in respect of the new notes; and
-
(iii)
-
in
the event of a deposit as provided in clause (i)(b) above, the Company has delivered irrevocable instructions to the Trustee under the Indenture
to apply the deposited money toward the payment of the new notes at maturity or the date of redemption, as the case may be.
In
addition, the Company must deliver an Officers' Certificate and an opinion of counsel to the Trustee stating that all conditions precedent to satisfaction and discharge have been
satisfied.
Denomination, Transfer, Exchange and Book-Entry Procedures
The new notes will be issued only in fully registered form, without interest coupons, and in denominations of $1,000 and integral
multiples of $1,000.
The
new notes will be evidenced by the global note which will be deposited with, or on behalf of, DTC, or any successor thereto, and registered in the name of Cede, as nominee of DTC.
Except as set forth below, record ownership of the global note may be transferred, in whole or in part, only to another nominee of DTC or to a successor of DTC or its nominee. Beneficial interests in
the global notes may not be exchanged for definitive notes in registered certificated form ("
Certificated Notes
") except in the limited circumstances
described below.
The
global note is exchangeable for Certificated Notes in fully registered form without interest coupons only in the following limited
circumstances:
-
-
DTC notifies the Company that it is unwilling or unable to continue as depositary for the global notes and the Company fails to
appoint a successor depositary within 90 days of such notice, or
-
-
there shall have occurred and be continuing an Event of Default with respect to the new notes.
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Certificated
Notes may not be exchanged for beneficial interests in the global note unless the transferor first delivers to the Trustee a written certificate (in the form provided in the
Indenture) to the effect that such transfer will comply with the appropriate transfer restrictions applicable to such notes. See "Notice to Investors."
In
those circumstances, DTC will determine in whose names any securities issued in exchange for the global note will be registered. Any such notes in certificated form will be issued in
minimum denominations of $1,000 and multiples of $1,000 in excess thereof and may be transferred or exchanged only in such minimum denominations.
DTC
or its nominee will be considered the sole owner and holder of the global note for all purposes, and as a result:
-
-
you cannot get new notes registered in your name if they are represented by the global note;
-
-
you cannot receive certificated (physical) notes in exchange for your beneficial interest in the global note;
-
-
you will not be considered to be the owner or holder of the global note or any new note it represents for any purpose; and
-
-
all payments on the global note will be made to DTC or its nominee.
The
laws of some jurisdictions require that certain kinds of purchasers (for example, certain insurance companies) can only own securities in definitive (certificated) form. These laws
may limit your ability to transfer your beneficial interests in the global note to these types of purchasers.
Only
institutions (such as a securities broker or dealer) that have accounts with the DTC or its nominee (called "participants") and persons that may hold beneficial interests through
participants (including through Euroclear Bank SA/NV or Clearstream Banking, société anonyme, as DTC participants) can own a beneficial interest in the global
note. The only place where the ownership of beneficial interests in the global note will appear and the only way the transfer of those interests can be made will be on the records kept by DTC (for
their participants' interests) and the records kept by those participants (for interests of persons held by participants on their behalf).
Secondary
trading in bonds and notes of corporate issuers is generally settled in clearing-house (that is, next-day) funds. In contrast, beneficial interests in a global note usually
trade in DTC's same-day funds settlement system, and settle in immediately available funds. We make no representations as to the effect that settlement in immediately available funds will have on
trading activity in those beneficial interests.
We
will make cash payments of interest on and principal of the global note to Cede, the nominee for DTC, as the registered owner of the global note. We will make these payments by wire
transfer of immediately available funds on each payment date.
You
may exchange or transfer old new notes at the corporate trust office of the Trustee for the new notes or at any other office or agency maintained by us for those purposes. We will
not require payment of a service charge for any transfer or exchange of the old notes, but DTC may require payment of a sum sufficient to cover any applicable tax or other governmental charge.
A
Holder may transfer or exchange old notes in accordance with the Indenture. The registrar and the Company may require a Holder to furnish appropriate endorsements and transfer
documents in connection with a transfer of old notes. Holders will be required to pay all taxes due on transfer. The Company is not required to transfer or exchange any old note selected for
redemption. Also, the Company is not required to transfer or exchange any old note for a period of 15 days before a selection of old notes to be redeemed.
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We have been informed that, with respect to any cash payment of interest on or principal of the global note, DTC's practice is to credit participants' accounts on
the payment date with payments in amounts proportionate to their respective beneficial interests in the new notes represented by the global note as shown on DTC's records, unless DTC has reason to
believe that it will not receive payment on that payment date. Payments by participants to owners of beneficial interests in notes represented by the global note held through participants will be the
responsibility of those participants, as is now the case with securities held for the accounts of customers registered in "street name."
We
also understand that neither DTC nor Cede will consent or vote with respect to the new notes. We have been advised that under its usual procedures, DTC will mail an "omnibus proxy" to
us as soon as possible after the record date. The omnibus proxy assigns Cede's consenting or voting rights to those participants to whose accounts the new notes are credited on the record date
identified in a listing attached to the omnibus proxy.
Because
DTC can only act on behalf of participants, who in turn act on behalf of indirect participants, the ability of a person having a beneficial interest in the principal amount
represented by the global note to pledge the interest to persons or entities that do not participate in the DTC book-entry system,
or otherwise take actions in respect of that interest, may be affected by the lack of a physical certificate evidencing its interest.
DTC
has advised us that it will take any action permitted to be taken by a Holder (including the presentation of new notes for exchange) only at the direction of one or more participants
to whose account with DTC interests in the global note are credited and only in respect of such portion of the principal amount of the new notes represented by the global note as to which such
participant has, or participants have, given such direction.
DTC
has also advised us as follows: DTC is a limited purpose trust company organized under the laws of the State of New York, a "banking organization" within the meaning of the New York
Banking Law, a member of the Federal Reserve System, a "clearing corporation" within the meaning of the Uniform Commercial Code, as amended, and a "clearing agency" registered pursuant to the
provisions of Section 17A of the Exchange Act. DTC was created to hold securities for its participants and facilitate the clearance and settlement of securities transactions between
participants through electronic book-entry changes in accounts of its participants. Participants include securities brokers and dealers, banks, trust companies and clearing corporations and may
include certain other organizations. Certain of such participants (or their representatives), together with other entities, own DTC. Indirect access to the DTC system is available to other entities
such as banks, brokers, dealers and trust companies that clear through or maintain a custodial relationship with a participant, either directly or indirectly. The rules applicable to DTC and its
direct and indirect participants are on file with the SEC.
The
policies and procedures of DTC, which may change periodically, will apply to payments, transfers, exchanges and other matters relating to beneficial interests in the global note. We
and the Trustee have no responsibility or liability for any aspect of DTC's or any participants' records relating to beneficial interests in the global note, including for payments made on the global
note, and we and the Trustee are not responsible for maintaining, supervising or reviewing any of those records.
The Trustee under the Indenture
We and certain of our affiliates maintain banking relations with U.S. Bank National Association and its affiliates.
Unless
we are in default, the Trustee is required to perform only those duties specifically set out in the Indenture. After an Event of Default, the Trustee is required to exercise the
same degree of care as a prudent individual would exercise in the conduct of his or her own affairs. The Trustee is under no obligation to exercise any of its rights or powers under the Indenture at
the request of any Holder,
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unless
the Holder offers the Trustee indemnity satisfactory to it against the costs, expenses and liabilities that might be incurred in connection with the Trustee's exercise of these rights or
powers. The Trustee is not required to spend or risk its own funds or otherwise incur financial liability in performing its duties if the Trustee believes that repayment or adequate indemnity is not
reasonably assured to it. The Indenture contains other provisions limiting the responsibilities and liabilities of the Trustee.
No Personal Liability of Directors, Officers, Employees and Stockholders
No director, officer, employee, incorporator, stockholder, unit-holder or member of the Company, any of its Subsidiaries or any of its
direct or indirect parent companies (including, following the PTP Conversion, the PTP Parent), as such (and not as a Guarantor), has any liability for any obligations of the Company or any Guarantor
under the new notes, the Indenture, the Guarantees or any other transaction document related to this offering.
Governing Law
The Indenture, the new notes and the Guarantees will be governed by and will be construed in accordance with the laws of the State of
New York.
Certain Definitions
"
Acquired Indebtedness
" means, with respect to any specified Person Indebtedness of any other Person existing at the time such other Person becomes a
Restricted Entity or at the time it merges or
consolidates with the Company or any of the Restricted Entities or is assumed in connection with the acquisition of assets from such other Person, including Indebtedness Incurred in contemplation of
such transaction. Such Indebtedness will be deemed to have been Incurred at the time such Person becomes a Restricted Entity or at the time it merges or consolidates with the Company or a Restricted
Entity or at the time such Indebtedness is assumed in connection with the acquisition of assets from such Person.
"
Adjusted Consolidated ENI
" means Consolidated ENI plus stock based compensation minus Consolidated Income Tax Expense (without duplication).
"
Adjusted Consolidated ENI EBITDA
" means Adjusted Consolidated ENI plus Consolidated Interest Expense, Consolidated Income Tax Expense and depreciation
and amortization on fixed assets.
"
Affiliate
" means, with respect to any specified Person, any other Person who directly or indirectly through one or more intermediaries controls, or is
controlled by, or is under common control with, such specified Person.
"
Asset Acquisition
" means:
-
(1)
-
an
Investment by the Company or any Restricted Entity in any other Person pursuant to which such Person will become a Restricted Entity, or will be merged
with or into the Company or any Restricted Entity;
-
(2)
-
the
acquisition by the Company or any Restricted Entity of the assets of any Person (other than a Subsidiary of the Company) which constitute all or
substantially all of the assets of such Person or comprises any division or line of business of such Person or any other properties or assets of such Person other than in the ordinary course of
business; or
-
(3)
-
any
Revocation with respect to an Unrestricted Entity.
"
Asset Sale
" means any direct or indirect sale, disposition, issuance, conveyance, lease, assignment or other transfer, including a Sale and Leaseback
Transaction (each, a "
disposition
") by the Company or any Restricted Entity of:
-
(1)
-
any
Capital Stock of any Restricted Entity or, following the PTP Conversion, the Company; or
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-
(2)
-
any
property or assets of the Company or any Restricted Entity (other than (i) Cash, (ii) Cash Equivalents or (iii) prior to the PTP
Conversion, Capital Stock of the Company and following the PTP Conversion, Capital Stock of the PTP Parent).
Notwithstanding
the preceding, the following items will not be deemed to be Asset Sales:
-
(1)
-
transactions
permitted under "Certain CovenantsLimitation on Merger, Consolidation and Sale of Assets," "Certain
CovenantsLimitation on Restricted Payments" and "Certain CovenantsLimitation on Liens;"
-
(2)
-
dispositions
in any fiscal year of the Company or, following the PTP Conversion, the PTP Parent, in a single or series of related transactions, of assets
(including the issuance or sale of Capital Stock of any Restricted Entity and, following the PTP Conversion, the Company (other than directors' qualifying shares or shares required by applicable law
to be held by a Person other than the Company or a Restricted Entity)) with a Fair Market Value not to exceed $5.0 million in the aggregate;
-
(3)
-
any
Permitted Investment or disposition of a Permitted Investment so long as in the ordinary course of business of the Company, and/or any of the Restricted
Entities, as applicable;
-
(4)
-
a
disposition or transfer of assets between or among the Company or a Restricted Entity and/or among any of the Restricted Entities, including a Person that
is or will become a Restricted Entity immediately after the disposition;
-
(5)
-
an
issuance or sale of Capital Stock by a Restricted Entity to the Company or any of the other Restricted Entities or, following the PTP Conversion, an
issuance or sale of Capital Stock by the Company or a Restricted Entity other than the PTP Parent to the Company or any other Restricted Entity, including the PTP Parent;
-
(6)
-
a
disposition of accounts receivable or rights to future advisory fees, or participation therein, in connection with a Receivables Transaction, or the
collection or compromise of any accounts receivable;
-
(7)
-
any
sale of assets received by the Company or any of the Restricted Entities upon the foreclosure on a Lien in favor of the Company or any of the Restricted
Entities or transfers by reason of eminent domain;
-
(8)
-
the
creation of a Lien not prohibited by the Indenture (but not the sale of property subject to a Lien);
-
(9)
-
the
surrender or waiver of contract rights or settlement, release or surrender of contract, tort or other claims or statutory rights in connection with a
settlement, as determined in good faith by the Company;
-
(10)
-
grants
of licenses or sublicenses in the ordinary course of business to use the patents, copyright and other intellectual property of the Company or any of
the Restricted Entities to the extent such license does not interfere with the business of the Company or any Restricted Entity;
-
(11)
-
any
financing transaction with respect to property or assets acquired by the Company or any Restricted Entity after the Issue Date, including Sale and
Lease-Back Transactions, permitted under the Indenture;
-
(12)
-
voluntary
terminations of Hedging Obligations;
-
(13)
-
any
issuance of Capital Stock in any Restricted Entity and, following the PTP Conversion, any issuance of Capital Stock in the Company or any Restricted
Entity other than the PTP Parent, to any officer, director, employee or consultant of the Company or any Restricted Entity in
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"
Asset Sale Transaction
" means, collectively, (1) any Asset Sale, (2) any sale or other disposition of Capital Stock, (3) any
Designation with respect to an Unrestricted Entity and (4) any sale or other disposition of property or assets excluded from the definition of Asset Sale by clause (3) of that
definition.
"
Authorized Officer
" means any officer of the Company as may be duly authorized to take actions under the Indenture and the new notes.
"
Base Capital Expenditures
" means, for any fiscal quarter, the quarterly average of the Company's capital expenditures (as determined in accordance with
GAAP) for the twelve fiscal quarters comprising the three full fiscal years immediately preceding such fiscal quarter, increased by the Capital Expenditures Grower Rate.
"
Beneficial Owner
" has the meaning assigned to such term in Rule 13d-3 and Rule 13d-5 under the Exchange Act, except that in calculating
the beneficial ownership of any particular "person" (as that term is used in Section 13(d)(3) of the Exchange Act), such "person" will be deemed to have beneficial ownership of all securities
that such "person" has the right to acquire by conversion or exercise of other securities, whether such right is currently exercisable or is exercisable only upon the occurrence of a subsequent
condition. The terms "
Beneficially Owns
," "
Beneficially Owned
" and "
Beneficial
Ownership
" have a corresponding meaning.
"
Board of Directors
" means (i) with respect to a corporation, the board of directors of the corporation or a duly authorized committee thereof;
(ii) with respect to a partnership, the Board of Directors of the general partner of the partnership; and (iii) with respect to any other Person, the board or committee of such Person
serving a similar function.
"
Board Resolution
" means, with respect to any Person, a copy of a resolution certified by the Secretary or an Assistant Secretary of such Person to have
been duly adopted by the Board of Directors of such Person and to be in full force and effect on the date of such certification, and delivered to the Trustee.
"
Business Day
" means each Monday, Tuesday, Wednesday, Thursday and Friday that is not (i) a day on which banking institutions in New York, New
York generally are authorized or obligated by law, regulation or executive order to close, or (ii) a day on which banking and financial institutions in New York, New York are closed for
business with the general public.
"
Capital Expenditures Grower Rate
" means, for any fiscal quarter, the percentage increase, if any (but ignoring decreases) in the employee headcount of
full time equivalent employees of the Company (or following the PTP Conversion, the PTP Parent) and its Subsidiaries at the end of the immediately preceding fiscal quarter over the quarterly average
of employee headcount of full time equivalent employees for the twelve fiscal quarters comprising the three full fiscal years immediately preceding such fiscal quarter.
"
Capital Stock
" means:
-
(1)
-
with
respect to any Person that is a corporation, any and all capital stock, shares, interests, participations or other equivalents (however designated and
whether or not voting) of corporate stock, including each class of Common Stock and Preferred Stock of such Person;
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-
(2)
-
with
respect to any Person that is not a corporation, any and all partnership, membership or other equity or ownership interests, shares, participations,
units or other equivalent or similar rights of such Person; and
-
(3)
-
any
warrants, rights or options to purchase any of the instruments or interests referred to in clause (1) or (2) above;
"
Capitalized Lease Obligations
" means, as to any Person, the obligations of such Person under a lease that are required to be classified and accounted
for as capital lease obligations under GAAP. For purposes of this definition, the amount of such obligations at any date will be the capitalized amount of such obligations at such date, determined in
accordance with GAAP
"
Cash
" means Money or a credit balance in a Deposit Account.
"
Cash Equivalents
" shall mean:
(1) U.
S. dollars;
(2) securities
issued or directly and fully and unconditionally guaranteed or insured by the U.S. government or any agency or instrumentality thereof the securities of which
are unconditionally guaranteed as a full faith and credit obligation of such government that mature prior to the earlier of (i) 18 months from the date of acquisition and (ii) the
Maturity Date;
(3) certificates
of deposit, time deposits and eurodollar time deposits with maturities of one year or less from the date of acquisition, bankers' acceptances with
maturities not exceeding one year and overnight bank deposits, in each case, with any commercial bank having capital and surplus of not less than $500.0 million (or the U.S. dollar equivalent
as of the date of determination) and a long-term unsecured
rating of A (or the equivalent thereof) or better by S&P or A2 (or the equivalent thereof) or better by Moody's;
(4) repurchase
obligations with a term of not more than seven days for underlying securities of the types described in clauses (2), (3) and (5) entered
into with any financial institution meeting the qualifications specified in clause (3) above;
(5) commercial
paper rated at least P-1 by Moody's or at least A-1 by S&P and in each case maturing within 90 days after the date of creation thereof;
(6) marketable
short-term money market and similar securities having a rating of at least P-1 or A-1 from either Moody's or S&P, respectively (or, if at any time neither
Moody's nor S&P shall be rating such obligations, an equivalent rating from another Rating Agency) and in each case maturing within 12 months after the date of creation thereof;
(7) readily
marketable direct obligations issued by any state, commonwealth or territory of the United States or any political subdivision or taxing authority thereof having
an Investment Grade Rating from either Moody's or S&P with maturities of 24 months or less from the date of acquisition;
(8) Investments
with average maturities of 12 months or less from the date of acquisition in money market funds rated A (or the equivalent thereof) or better by S&P
or A2 (or the equivalent thereof) or better by Moody's; and
(9) shares
of investment companies that are registered under the Investment Company Act of 1940, as amended, and substantially all of the investments of which are one or
more of the types of securities described in clauses (1) through (8) above.
Notwithstanding
the foregoing, Cash Equivalents shall include amounts denominated in currencies other than U.S. dollars,
provided
that such amounts are
converted into U.S. dollars as promptly as practicable and in any event within ten Business Days following the receipt of such amounts.
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"
Change of Control Triggering Event
" means the occurrence of any of the following:
-
(a)
-
the
sale, lease, transfer or other conveyance, in one or a series of related transactions, of all or substantially all of the assets of the Company and its
Restricted Subsidiaries or, following the PTP Conversion, the PTP Parent, the Company and the other Restricted Entities, in each case, taken as a whole, to any Person other than to the Permitted
Holder;
-
(b)
-
the
acquisition by any Person or group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act, or any successor
provision), including any group acting for the purpose of acquiring, holding or disposing of securities (within the meaning of Rule 13d-5(b)(1) under the Exchange Act), other than the Permitted
Holder, in a single transaction or in a related series of transactions, by way of merger, consolidation or other business combination or purchase of Beneficial Ownership of 50% or more of the Voting
Stock of the Company or, following the PTP Conversion, the PTP Parent;
provided
that, for purposes of calculating the Beneficial Ownership of any group,
the Permitted Holder shall not be attributed Beneficial Ownership of the Capital Stock of any unaffiliated person;
-
(c)
-
any
Person or group (as defined in clause (b)), other than the Permitted Holder, shall be entitled to appoint or elect 50% or more of the Board of
Directors of the Company or, following the PTP Conversion, the PTP Parent; or
-
(d)
-
the
first day on which the majority of the Board of Directors of the Company or, following the PTP Conversion, the PTP Parent, or any of its direct or
indirect parent companies then in office shall cease to consist of Continuing Directors.
Notwithstanding
anything in clauses (a) through (d) above and for the avoidance of doubt, the consummation of the transactions contemplated by the PTP Conversion will not constitute a
Change of Control Triggering Event.
"
CLO
" means a special purpose vehicle that owns a portfolio of investments consisting of senior secured corporate loans, other corporate credit
exposures and/or additional investments typical for vehicles of such type, and which issues various tranches of debt and equity securities to finance the purchase of those investments.
"
CLO AUM
" means the assets in CLOs under management of the Company, the PTP Parent or any of their respective direct or indirect subsidiaries.
"
Commodity Agreement
" means any commodity or raw material futures contract, commodity or raw materials option, or any other agreement designed to
protect against or manage exposure to fluctuations in commodity or raw materials prices, including but not limited to natural gas prices.
"
Common Stock
" of any Person means any and all shares, interests or other participations in, and other equivalents (however designated and whether
voting or non-voting) of such Person's common equity interests, whether outstanding on the Issue Date or issued after the Issue Date, and includes, without limitation, all series and classes of such
common equity interests.
"
Consolidated ENI
" means, Consolidated Net Income plus (i) Consolidated Income Tax Expense, (ii) merger and acquisition related items such
as fee-sharing arrangements, amortization and impairments of intangible assets and gain (loss) on contingent consideration for earn-outs, (iii) incentive fee sharing arrangements with certain
former employees and non-cash compensation related to profits interests granted by CIFC Parent Holdings LLC (a former significant stockholder of the Company), (iv) revenues attributable
to collateralized debt obligation assets under management, and (v) other non-recurring items which items include:
-
(1)
-
net
after-tax (using a reasonable estimate based on applicable tax rates) gains or losses from non-ordinary course Asset Sale transactions or abandonments
or reserves relating thereto;
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-
(2)
-
net
after-tax (using a reasonable estimate based on applicable tax rates) items classified as extraordinary gains or losses;
-
(3)
-
the
net income (or loss) of any Person, other than such Person and any Subsidiary of such Person (or, in the case of the Company, any Restricted Subsidiary
and, following the PTP Conversion, in the case of the PTP Parent, the Company and any other Restricted Entity); except that the net income (but not loss) of any Person that is not a Restricted
Subsidiary (and, following the PTP Conversion, not the Company or any other Restricted Entity) or that is accounted for by the equity method of accounting shall be included only to the extent of the
amount of dividends or distributions actually paid in cash to the Company or any of the Restricted Entities;
-
(4)
-
solely
for the purpose of determining the amount available for Restricted Payments under clause (III)(A) of the covenant described under "Certain
CovenantsLimitation on Restricted Payments," the net income (but not loss) of any Subsidiary of such Person (or, in the case of the Company, any Restricted Subsidiary and, following the
PTP Conversion, in the case of the PTP Parent, the Company or any other Restricted Entity) to the extent that a corresponding amount could not be distributed to such Person at the date of
determination as a result of any restriction pursuant to the constituent documents of such Subsidiary (or, in the case of the Company, such Restricted Subsidiary and, following the PTP Conversion, in
the case of the PTP Parent, the Company or such Restricted Entity) or any law, regulation, agreement or judgment applicable to any such distribution;
-
(5)
-
any
restoration to income of any contingency reserve, except to the extent that provision for such reserve was made out of Consolidated Net Income accrued
at any time following the Issue Date;
-
(6)
-
any
gain (or loss) from fluctuation in currency values in accordance with GAAP;
-
(7)
-
effects
of adjustments (including the effects of such adjustments pushed down to the Company and the Restricted Entities) in the property and equipment,
software and other intangible assets, deferred revenue and debt line items in such Person's Consolidated financial statements resulting from the application of purchase accounting in relation to any
consummated acquisition or the amortization or write-off of any amounts thereof, net of taxes;
-
(8)
-
any
impairment charge or asset write-off, in each case, pursuant to GAAP and the amortization of intangibles arising pursuant to GAAP;
-
(9)
-
any
fees, charges, costs and expenses incurred in connection with the transactions contemplated by this offering memorandum or future securities offerings
or credit facilities;
-
(10)
-
(a)
the amount of any write-off of deferred financing costs or of Indebtedness issuance costs and the amount of charges related to any premium paid in
connection with repurchasing or Refinancing Indebtedness shall be excluded, (b) all nonrecurring expenses and charges relating to such repurchase or Refinancing of Indebtedness or relating to
any incurrence of Indebtedness, in each case, whether or not such transaction is consummated and (c) organizational fund start-up costs of new investment funds that are required to be expensed
immediately under GAAP and are subsequently absorbed by the fund and amortized over the life of the fund following its launch;
-
(11)
-
any
severance or similar one-time compensation charges;
-
(12)
-
fees,
expenses, costs and charges relating to any offering of Equity Interests or Indebtedness of the Company or the Restricted Entities or any acquisition
permitted by the Indenture;
-
(13)
-
litigation
charges which are not expected to be of a recurring nature;
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-
(14)
-
non-recurring
restructuring charges incurred in connection with the closing and restructuring of the Company's or any Restricted Entity's operations;
-
(15)
-
fees,
expenses, costs and charges relating to acquisitions and dispositions of assets or businesses outside of the ordinary course; and
-
(16)
-
the
cumulative effect of changes in accounting principles.
"
Consolidated Fixed Charge Coverage Ratio
" means, for any Person as of any date of determination, the ratio of the aggregate amount of Adjusted
Consolidated ENI EBITDA of such Person for the related Four Quarter Period to Consolidated Fixed Charges for such Person for such Four Quarter Period. For purposes of this definition,
"
Adjusted Consolidated ENI EBITDA
" and "
Consolidated Fixed Charges
" will be calculated after giving
effect on a pro forma basis as determined in the good faith judgment of the Company's chief financial officer, for the period of such calculation to:
-
(1)
-
the
Incurrence or repayment or redemption of any Indebtedness (including Acquired Indebtedness) of such Person or any of its Subsidiaries (or, in the case
of the Company, any Restricted Subsidiary and, following the PTP Conversion, in the case of the PTP Parent, the Company or any other Restricted Entity), and the application of the proceeds thereof,
including the Incurrence of any Indebtedness (including Acquired Indebtedness), and the application of the proceeds thereof, giving rise to the need to make such determination, occurring during such
Four Quarter Period or at any time subsequent to the last day of such Four Quarter Period and on or prior to such date of determination, to the extent, in the case of an Incurrence, such Indebtedness
is outstanding on the date of determination, as if such Incurrence and the application of the proceeds thereof, repayment or redemption occurred on the first day of such Four Quarter Period;
-
(2)
-
any
Asset Sale Transaction or Asset Acquisition by such Person or any of its Subsidiaries (or, in the case of the Company, any Restricted Subsidiary and,
following the PTP Conversion, in the case of the PTP Parent, the Company or any other Restricted Entity), including any Asset Sale Transaction or Asset Acquisition giving rise to the need to make such
determination occurring during the Four Quarter Period or at any time subsequent to the last day of the Four Quarter Period and on or prior to such date of determination, as if such Asset Sale
Transaction or Asset Acquisition occurred on the first day of the Four Quarter Period including any pro forma expense and cost reductions, synergies and other operating improvements that have occurred
or are reasonably expected to occur and are reasonably the basis of pro forma adjustment (regardless of whether such cost savings, synergies or operating improvements could then be reflected in pro
forma financial statements in accordance with Regulation S-X under the Securities Act);
-
(3)
-
the
Adjusted Consolidated ENI EBITDA attributable to discontinued operations and operations or businesses (and ownership interests therein) disposed of
prior to the date of determination, will be excluded;
-
(4)
-
the
Consolidated Fixed Charges attributable to discontinued operations, as determined in accordance with GAAP, and operations or businesses (and ownership
interests therein) disposed of prior to the date of determination, will be excluded, but only to the extent that the obligations giving rise to such Consolidated Fixed Charges will not be obligations
of the specified Person or any of its Restricted Subsidiaries (or, following the PTP Conversion, in the case of the PTP Parent, the Company or any other Restricted Entity) following the date of
determination;
-
(5)
-
any
Person that is a Restricted Entity on the date of determination or that becomes a Restricted Entity on the date of determination will be deemed to have
been a Restricted Entity at all times during such Four Quarter Period; and
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-
(6)
-
any
Person that is not a Restricted Entity on the date of determination or would cease to be a Restricted Entity on the date of determination will be deemed
not to have been a Restricted Entity at any time during such Four Quarter Period.
For
purposes of this definition, whenever pro forma effect is to be given to a transaction, the pro forma calculations shall be made in good faith by a responsible financial or
accounting officer of the Company and shall comply with Regulation S-X promulgated under the Securities Act, except that the pro forma calculations may also include reasonably identifiable and
factually supportable operating expense reductions for which the steps necessary for realization have been taken or are reasonably expected to be completed within 12 months of the transaction
and are set forth in an Officers' Certificate. For the avoidance of doubt, the actual adjustments described in the definitions of "
Adjusted Consolidated
ENI
" and "
Adjusted Consolidated ENI EBITDA
" elsewhere in this offering memorandum shall be deemed to comply with the standards
set forth in the immediately preceding sentence.
"
Consolidated Fixed Charges
" means, for any Person for any period, the sum, without duplication, of:
-
(a)
-
Consolidated
Interest Expense for such Person for such period; and
-
(b)
-
the
amount of all Cash and non-Cash dividend payments on any series of Preferred Stock or Disqualified Capital Stock of such Person (other than dividends
paid in Qualified Capital Stock) or any Subsidiary of such Person (Restricted Subsidiary in the case of the Company and, following the PTP Conversion, any other Restricted Entity or the Company in the
case of the PTP Parent) paid, accrued or scheduled to be paid or accrued during such period, excluding dividend payments on Preferred Stock or Disqualified Capital Stock paid, accrued or scheduled to
be paid to such Person or another Subsidiary (Restricted Subsidiary in the case of the Company and, following the PTP Conversion, any other Restricted Entity or the Company in the case of the PTP
Parent).
"
Consolidated Income Tax Expense
" means, with respect to any Person for any period, all applicable federal, state and local income taxes payable by such
Person and its Subsidiaries (or, in the case of the Company, its Restricted Subsidiaries and, following the PTP Conversion, in the case of the PTP Parent, the Company and the other Restricted
Entities) for such period as determined on a Consolidated basis.
"
Consolidated Interest Expense
" means, with respect to any Person for any period, without duplication, the sum of:
-
(a)
-
Consolidated
interest expense of such Person and its Restricted Subsidiaries (and, in the case of the PTP Parent following the PTP Conversion, the other
Restricted Entities and the Company) for such period, to the extent such expense was deducted (and not added back) in computing Consolidated Net Income (including (i) amortization of original
issue discount resulting from the issuance of Indebtedness at less than par, (ii) all commissions, discounts and other fees and charges owed with respect to letters of credit or bankers
acceptances, (iii) non-cash interest expense (but excluding any non-cash interest expense attributable to the movement in the mark-to-market valuation of Hedging Obligations or other derivative
instruments in accordance with GAAP), (iv) the interest component of Capitalized Lease Obligations, (v) net payments, if any, made by such Person pursuant to interest rate Hedging
Obligations with respect to Indebtedness, and (vi) net losses on Hedging Obligations or other derivative instruments entered into for the purpose of hedging interest rate risk, and excluding
(x) amortization of deferred financing fees, debt issuance costs, commissions, fees and expenses, (y) any expensing of bridge, commitment and other financing fees and
(z) commissions, discounts, yield and other fees and charges (including any interest expense) related to any Receivables Transaction);
plus
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-
(b)
-
Consolidated
capitalized interest of such Person and its Restricted Subsidiaries (and, following the PTP Conversion in the case of the PTP Parent, the other
Restricted Entities and the Company) for such period, whether paid or accrued;
less
-
(c)
-
interest
income of such Person and its Restricted Subsidiaries (and, following the PTP Conversion in the case of the PTP Parent, the other Restricted
Entities and the Company) for such period;
less
-
(d)
-
net
gains on Hedging Obligations or other derivative instruments entered into for the purpose of hedging interest rate risk;
less
-
(e)
-
net
payments received, if any, by such Person pursuant to interest rate Hedging Obligations with respect to Indebtedness of CIFC or any Restricted Entity.
For purposes of this definition, interest on a Capitalized Lease Obligation shall be deemed to accrue at an interest rate reasonably determined by a responsible financial or
accounting officer of the Company to be the rate of interest implicit in such Capitalized Lease Obligation in accordance with GAAP.
"
Consolidated Net Income
" means, with respect to any Person for any period, the aggregate net income (or loss) of such Person and its Subsidiaries (or,
in the case of the Company, its Restricted Subsidiaries and, following the PTP Conversion, in the case of the PTP Parent, the Company and the other Restricted Entities), after deducting (or adding)
the portion of such net income (or loss) attributable to minority interests in Restricted Subsidiaries or Restricted Entities which are Subsidiaries of such Person, for such period on a Consolidated
basis.
"
Consolidated Net Worth
" of any Person means the Consolidated stockholders' equity of such Person, determined on a Consolidated basis, less (without
duplication) amounts attributable to Disqualified Capital Stock of such Person.
"
Consolidated Total Assets
" means, for any Person at any time, the total Consolidated assets of such Person and its Subsidiaries (or, in the case of the
Company, its Restricted Subsidiaries and, following the PTP Conversion, in the case of the PTP Parent, the Company and the other Restricted Entities) as set forth on the most recent balance sheet of
such Person.
"
Consolidated Total Senior Indebtedness
" shall mean, as of the date of determination, all Consolidated Indebtedness for any Person other than
Subordinated Indebtedness of such Person.
"
Consolidated Total Senior Indebtedness to Adjusted Consolidated ENI EBITDA Ratio
" means, for any Person as of any date of determination, the ratio of
Consolidated Total Senior Indebtedness as of such date to Adjusted Consolidated ENI EBITDA for the related Four Quarter Period.
"
Consolidation
" shall mean (i) with respect to the Company, the consolidation of the accounts of the Company with those of its Restricted
Subsidiaries in accordance with GAAP (as adjusted by this definition) consistently applied, (ii) following the PTP Conversion, with respect to the PTP Parent, the consolidation of the accounts
of the PTP Parent with those of the Company and the Restricted Entities other than the PTP Parent in accordance with GAAP (as adjusted by this definition) consistently applied and (iii) with
respect to any other Restricted Entity, the consolidation of the accounts of such Restricted Entity with those of any of its subsidiaries which are also Restricted Entities;
provided
, that, in each case,
Consolidation will not include consolidation of the accounts of any Unrestricted Entity or Investment Vehicle, but any
interest of the Company, the PTP Parent or any other Restricted Entity in
an Unrestricted Entity or Investment Vehicle will be accounted for as an Investment. The term "
Consolidated
" has a correlative meaning.
"
Continuing Director
" means, as of any date of determination, any member of a board of directors who (1) was a member of such board of directors
on the date of the Indenture; or (2) was either (x) nominated for election or elected to such Board of Directors by a majority of the Continuing
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Directors
(which, for the avoidance of doubt, includes directors elected or appointed pursuant to this clause (2) after the date of the Indenture) who were members of such Board of Directors at
the time of nomination or election, or (y) designated or appointed by a Permitted Holder.
"
control
" means the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of a Person,
whether through the ownership of voting securities, by contract or otherwise. For purposes of this definition, the terms "controlling," "controlled by" and "under common control with" have correlative
meanings.
"
Credit Facilities
" means, with respect to the Company or any Restricted Entities, one or more debt facilities or other financing arrangements
(including, without limitation, commercial paper facilities or indentures) providing for revolving credit loans, term loans, letters of credit or other long-term indebtedness, including any notes,
mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith, and any amendments, supplements, modifications, extensions, renewals, restatements or
refundings thereof and any indentures or credit facilities or commercial paper facilities that replace, refund or refinance any part of the loans, notes other credit facilities or commitments
thereunder, including any such replacement, refunding or refinancing facility or indenture that increases the amount permitted to be borrowed thereunder or alters the maturity thereof (provided that
such increase in borrowings to the extent in excess of the amount permitted under clause (b) of the second paragraph under "Certain CovenantsLimitation on the
Incurrence of Additional Indebtedness" is otherwise permitted to be incurred under such covenant) or adds Restricted Entities as additional borrowers or guarantors thereunder and whether by the same
or any other agent, lender or group of lenders.
"
Currency Agreement
" means, in respect of any Person, any foreign exchange contract, currency swap agreement or other similar agreement as to which such
Person is a party designed to hedge foreign currency risk of such Person.
"
Default
" means any event which is, or after the giving of notice or passage of time or both would be (if not cured, waived or otherwise remedied), an
Event of Default.
"
Deposit Account
" shall have the meaning accorded to such term in the UCC.
"
Designated Capital Raise
" means (i) any Equity Offering and (ii) any issuance of debt securities by the Company, or following the PTP
Conversion, the PTP Parent, evidenced by bonds, debentures, notes or other similar instruments.
"
Designated Non-cash Consideration
" means the Fair Market Value of non-cash consideration received by the Company or any Restricted Entities in
connection with an Asset Sale designated as Designated Non-cash Consideration pursuant to an Officers' Certificate setting forth the basis of such designation and the valuation of such consideration,
less the amount of Cash or Cash Equivalents received in connection with a subsequent sale of such Designated Non-cash Consideration.
"
Designation
" and "
Designation Amount
" have the meanings set forth under "Certain
CovenantsLimitation on Designation of Unrestricted Entities" above.
"
Disqualified Capital Stock
" means that portion of any Capital Stock which, by its terms (or by the terms of any security into which it is convertible
or for which it is exchangeable at the option of the holder thereof), or upon the happening of any event, matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or
is redeemable at the sole option of the holder thereof, in any case, on or prior to the final maturity date of the new notes; provided, that any Capital Stock that would not constitute Disqualified
Capital Stock but for provisions thereof giving holders thereof the right to require such Person to purchase or redeem such Capital Stock upon the occurrence of an
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"asset
sale" or "change of control" occurring prior to the final maturity of the new notes shall not constitute Disqualified Capital Stock if:
(1) the
"asset sale" or "change of control" provisions applicable to such Capital Stock are not materially more favorable to the holders of such Capital Stock than the terms
applicable to the new notes and described under "Certain CovenantsLimitation on Sales of Assets and Subsidiary Stock" and "Certain CovenantsChange
of Control Triggering Event"; and
(2) any
such requirement only becomes operative after compliance with such terms applicable to the new notes, including the purchase of any notes tendered pursuant thereto.
In
addition, if such Capital Stock is issued to any employees of the Company or, following the PTP Conversion, the PTP Parent, or any of their respective Subsidiaries for compensatory
purposes, or to or by a plan for the benefit of employees of the Company, the PTP Parent or any of their respective Subsidiaries, such Capital Stock shall not constitute Disqualified Stock solely
because it may be required to be repurchased by the Company, the PTP Parent or any of their respective Subsidiaries pursuant to the terms of any such arrangement.
"
Domestic Subsidiary
" means any direct or indirect Subsidiary of the Company, and, following the PTP Conversion, any PTP Parent Subsidiary, that was
formed under the laws of the United States, any State of the United States or the District of Columbia.
"
Equity Offering
" means any public or private sale of Common Stock or Preferred Stock (excluding Disqualified Capital Stock) of the Company or,
following the PTP Conversion, the PTP Parent, other than:
-
(1)
-
public
offerings with respect to the Company's or, following the PTP Conversion, the PTP Parent, or any of their respective common stock registered on
Form S-8; and
-
(2)
-
issuances
to any Subsidiary of the Company or, following the PTP Conversion, the PTP Parent;
"
Excess ENI Cash Flow
" means, with respect to any fiscal quarter, Adjusted Consolidated ENI EBITDA for such fiscal quarter minus (i) Base Capital
Expenditures for such fiscal quarter, (ii) Consolidated Interest Expense for such fiscal quarter, (iii) Consolidated Income Tax Expense for such fiscal quarter, and (iv) dividends
or distributions on the shares of Capital Stock of the PTP Parent following the PTP Conversion paid in such fiscal quarter to the equity holders of the PTP Parent for the primary purpose of offsetting
the Company's good faith estimate of the tax liability of a holder of Capital Stock of the PTP Parent as a result of holding such shares (applying, for the purposes of such good faith estimate, the
tax liability of U.S. holders at the highest marginal rate in the U.S., giving effect to federal, state and local rates). The Adjusted Consolidated ENI EBITDA for any such fiscal quarter shall be
increased by 25% of the Company's reasonable good faith estimate of the annual recurring reductions in operating expenses arising from steps that have been taken to reduce full time equivalent
headcount during or prior to such fiscal quarter, which are reasonably expected to result in a
recurring reduction in expenses within the four fiscal quarters next following the end of such fiscal quarter.
"
Exchange Act
" means the Securities Exchange Act of 1934, as amended.
"
Fair Market Value
" means, at the time of any given transaction, with respect to any asset, the price (after taking into account any liabilities
relating to such assets) which could be negotiated in an arm's-length free market transaction, for cash, between a willing seller and a willing and able buyer, neither of which is under any compulsion
to complete the transaction.
"
Fitch
" means Fitch Ratings, Ltd. or any successor to the rating agency business thereof.
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"
following the PTP Conversion
" means after the consummation of the transactions contemplated by the PTP Conversion and the PTP Parent becoming a
Guarantor of the new notes.
"
Foreign Manager Owned Affiliate"
means any Unrestricted Entity that is not a Domestic Subsidiary the purpose of which is (i) to hold Permitted
CLO Investments either directly or through one or more other entities that are themselves owned in whole or in part directly or indirectly by such entity, and (ii) to provide investment
advisory or other services, primarily outside of the U.S., related to a Permitted Business either directly or through one or more other entities that are themselves owned in whole or in part directly
or indirectly by such entity to Persons.
"
Four Quarter Period
" means the four most recent full fiscal quarters for which a Person's financial statements are available ending prior to the date
of determination.
"
GAAP
" means generally accepted accounting principles in the United States in effect on the Issue Date, except for any reports required to be delivered
under the covenant "SEC Reports and Reports to Holders," which shall be prepared in accordance with GAAP in effect on the date thereof.
"
Government Obligations
," with respect to any new note, means (i) direct obligations of the United States of America where the timely payment or
payments thereunder are supported by the full faith and credit of the United States of America or (ii) obligations of a Person controlled or supervised by and acting as an agency or
instrumentality of the United States of America where the timely payment or payments thereunder are unconditionally guaranteed as a full faith and credit obligation by the United States of America,
and which, in the case of (i) or (ii), are not callable or redeemable at the option of the issuer or issuers thereof, and shall also include a depository receipt issued by a bank or trust
company as custodian with respect to any such Government Obligation or a specific payment of interest on or principal of or other amount with respect to any such Government Obligation held by such
custodian for the account of the holder of a depository receipt;
provided, however
that (except as required by law) such custodian is not authorized to
make any deduction from the amount payable to the holder of such depository receipt from any amount received by the custodian in respect of the Government Obligation or the specific payment of
interest on or principal of or other amount with respect to the Government Obligation evidenced by such depository receipt.
"
Guarantee
" means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person:
(1) to
purchase or pay, or advance or supply funds for the purchase or payment of, such Indebtedness of such other Person, whether arising by virtue of partnership
arrangements, or by agreement to keep-well, to purchase assets, goods, securities or services, to take or pay, or to maintain financial statement conditions or otherwise, or
(2) entered
into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect
thereof, in whole or in part,
provided
, that "Guarantee" will not include endorsements for collection or deposit in the ordinary course of business. "Guarantee" used as a verb has a
corresponding meaning. Unless the context requires otherwise, references to the "Guarantees" are to any Guarantee of the Company's Obligations under the new notes and the Indenture provided by a
Guarantor pursuant to the Indenture.
"
Guarantor
" means any Person that incurs a Guarantee of the new notes, including any Subsidiary Guarantor and, following the PTP Conversion, the PTP
Parent;
provided
that upon the release and discharge of such Person from its Guarantee in accordance with the Indenture, such Person shall cease to be a
Guarantor.
"
Hedging Obligations
" means the obligations of any Person pursuant to any Interest Rate Agreement, Currency Agreement, Market Hedge Agreement or
Commodity Agreement.
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"
Holders
" means, at any given time, the holders of the new notes.
"
Incur
" means, with respect to any Indebtedness or other obligation of any Person, to create, issue, incur (including by conversion, exchange or
otherwise), assume, Guarantee or otherwise become liable in respect of such Indebtedness or other obligation on the balance sheet of such Person (and
"
Incurrence
," "
Incurred
" and "
Incurring
" will have
meanings correlative to the preceding).
"
Indebtedness
" means, with respect to any Person, if and to the extent it would appear as a liability on a balance sheet (excluding the footnotes
thereto) of such Person prepared in accordance with GAAP (as adjusted by the definition of "
Consolidation
"), without duplication:
(1) the
principal amount (or, if less, the accreted value) of all obligations of such Person for borrowed money;
(2) the
principal amount (or, if less, the accreted value) of all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;
(3) all
Capitalized Lease Obligations of such Person;
(4) all
obligations of such Person issued or assumed as the deferred purchase price of property, all conditional sale obligations and all payment obligations under any title
retention agreement (but excluding (i) trade accounts payable and other accrued liabilities accounted for as current liabilities (in accordance with GAAP) arising in the ordinary course of
business that are not overdue by 180 days or more or are being contested in good faith and (ii) any earn-out obligations);
(5) all
obligations of such Person in respect of letters of credit, banker's acceptances or similar credit transactions, including reimbursement obligations in respect
thereof;
(6) Guarantees
and other contingent obligations of such Person in respect of Indebtedness referred to in clauses (1) through (5) above and clauses (8)
through (10) below;
(7) all
Indebtedness of any other Person of the type referred to in clauses (1) through (6) above which is secured by any Lien on any property or asset of the
first Person, the amount of such Indebtedness being deemed to be the lesser of the Fair Market Value of such property or asset or the amount of the Indebtedness so secured;
(8) all
obligations under Hedging Obligations of such Person;
(9) to
the extent not otherwise included in this definition, the Receivables Transaction Amount outstanding relating to any Receivables Transaction;
(10) all
Disqualified Capital Stock issued by such Person with the amount of Indebtedness represented by such Disqualified Capital Stock being equal to the greater of its
voluntary or involuntary liquidation preference and its maximum fixed repurchase price, but excluding accrued dividends, if any; and
(11) all
obligations in respect of repurchase agreements relating to loans, securities or other financial assets of such Person sold to a third party where such sales are
coupled with an agreement of such Person to repurchase such loan, security or financial asset at an agreed price at a later date.
"
Independent Financial Advisor
" means an accounting firm, appraisal firm, investment banking firm or consultant of nationally recognized standing that
is, in the reasonable, good faith judgment of the Company, qualified to perform the task for which it has been engaged and which is independent in connection with the relevant transaction.
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"
Interest Rate Agreement
" of any Person means any interest rate protection agreement (including, without limitation, interest rate swaps, caps, floors,
collars, derivative instruments and similar agreements) and/or other types of hedging agreements designed to hedge interest rate risk of such Person.
"
Investment
" means, with respect to any Person, any:
(1) direct
or indirect loan, advance or other extension of credit (including, without limitation, a Guarantee) to any other Person,
(2) capital
contribution to any other Person (by means of any transfer of cash or other property to others or any payment for property or services for the account or use of
such Person), or
(3) purchase
or acquisition by such Person of any Capital Stock, bonds, notes, debentures or other securities or evidences of Indebtedness issued by, any other Person.
"
Investment
" will exclude accounts receivable or deposits arising in the ordinary course of business.
"
Invest
," "
Investing
" and "
Invested
" will have
corresponding meanings.
"
Investment Grade Rating
" means a rating equal to or higher than Baa3 (or the equivalent) by Moody's, BBB (or the equivalent) by S&P
and BBB (or equivalent) by Fitch.
"
Investment Return
" means, in respect of any Investment (other than a Permitted Investment) made after the Issue Date by the Company or any Restricted
Entity:
(1) the
cash proceeds received by the Company or any Restricted Entity upon the sale, liquidation, repayment or other return of such Investment or, in the case of a
Guarantee, the amount of the Guarantee upon the unconditional release of the Company and the Restricted Entities in full, less any payments previously made by the Company or any Restricted Entity in
respect of such Guarantee;
(2) in
the case of the Revocation of the Designation of an Unrestricted Entity, an amount equal to the lesser of:
-
(a)
-
the
Company's, or, following the PTP Conversion, the PTP Parent's, Investment in such Unrestricted Entity at the time of such Revocation; and
-
(b)
-
the
Designation Amount with respect to such Unrestricted Entity upon its Designation which was treated as a Restricted Payment; and
(3) in
the event the Company or any Restricted Entity makes any Investment in a Person that, as a result of or in connection with such Investment, becomes a Restricted
Entity, the Fair Market Value of the Investment of the Company and the Restricted Entities in such Person;
in
the case of each of (1), (2) and (3), up to the amount of such Investment that was treated as a Restricted Payment under "Certain CovenantsLimitation
on Restricted Payments" less the amount of any previous Investment Return in respect of such Investment.
"
Investment Vehicle
" means (i) a separate account or vehicle for collective investment for the benefit of third parties which third parties are
not Affiliates of the Company (in whatever form of organization, including a corporation, limited liability company, partnership, association, trust or other entity, and including each separate
portfolio or series of any of the foregoing), including any entity issuing collateralized loan obligations or collateralized debt obligations, the investments of which are managed by the Company or
any Restricted Entity in the ordinary course of business; (ii) a Permitted CLO; (iii) a Permitted Seed Fund; (iv) a Permitted Warehouse SPV; and (v) a Manager Owned
Affiliate.
"
Issue Date
" means November 2, 2015.
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"
Key Person Trigger Event
" means the termination of the Company, the PTP Parent or any of their respective direct or indirect subsidiaries as the
collateral manager of one or more CLOs due to the exercise of a termination remedy provided by a key person trigger set forth in the respective management agreement with respect to any such CLO;
provided, that during the 12 months following such termination on the applicable determination date (as defined below) (i) there is a decrease in CLO AUM (on the applicable determination
date) equal to or in excess of 10% of CLO AUM as of June 30, 2015, and (ii) the Consolidated Total Senior Indebtedness to Adjusted Consolidated ENI EBITDA Ratio of the Company or,
following the PTP Conversion, the PTP Parent is greater than 2.5 to 1.0. The "determination date" for purposes of this definition shall be the last day of each fiscal quarter ending within such
12 month period.
"
Lien
" means any lien, mortgage, deed of trust, pledge, security interest, charge or encumbrance of any kind (including any conditional sale or other
title retention agreement, any lease in the nature thereof and any agreement to give any security interest);
provided
, that the lessee in respect of a
Capitalized Lease Obligation or Sale and Leaseback Transaction will be deemed to have Incurred a Lien on the
property leased thereunder;
provided, further
that in no event shall an operating lease be considered a Lien.
"
Majority-Owned Affiliate
" of any Person means an entity (other than an issuing entity) that, directly or indirectly, majority controls, is majority
controlled by or is under common majority control with, such Person. For purposes of this definition, "majority control" means ownership of more than 50% of the equity of an entity, or ownership of
any other controlling financial interest in the entity, as determined under GAAP.
"
Manager Owned Affiliate
" means an entity the sole purpose of which is to hold, directly or indirectly, Permitted CLO Investments either directly or
through one or more other entities that are themselves wholly-owned directly or indirectly by such entity;
provided
that (i) any Investment made
by such entity must be a Permitted CLO Investment and (ii) entities that are not Affiliates of the Company, the PTP Parent and/or their respective Affiliates, as the case may be, collectively
hold 5% or more of the equity interests of such entity.
"
Market Hedge Agreement
" means any long or short position with respect to a broad-based market, sector or industry index, or any other substantially
similar arrangement, made for non-speculative purposes and designed to protect against or manage, indirectly, exposure to fluctuations in the value of a debt instrument (or portfolio or fund comprised
of debt instruments) as a result of market risk.
"
Maturity
" when used with respect to any new note, means the date on which the principal of such note becomes due and payable as provided in the new
notes and the Indenture, whether at the Stated Maturity or by declaration of acceleration, notice of redemption, notice of option to elect repayment or otherwise and includes any date of redemption.
"
Maximum Designated Capital Raise Amount
" means (i) for the first six months following the date of a Designated Capital Raise (the
"
Designated Capital Raise Date
"), the net proceeds from the Designated Capital Raise (the "
Designated Capital Raise
Amount
"), (ii) for any date after the last day of such six month period through the date which is 12 months after the Designated Capital Raise Date, 75% of the
Designated Capital Raise Amount, (iii) for any date after the last day of such 12 month period through the date which is 18 months after the Designated Capital Raise Date, 50% of
the Designated Capital Raise Amount, (iv) for any date after the last day of such 18 month period the Designated Capital Raise Date through the date which is 24 months after the
Designated Capital Raise Date, 25% of the Designated Capital Raise Amount and (v) for any date after the last day of such 24 month period, zero.
"
Maximum Note Proceeds Amount
" means (i) for the first six months following the Issue Date, the net proceeds from the offering of the new notes
(the "
Note Proceeds Amount
"), (ii) for any date after the
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last
day of such six month period through the date which is 12 months after the Issue Date, 75% of the Note Proceeds Amount, (iii) for any date after the last day of such 12 month
period through the date which is 18 months after the Issue Date, 50% of the Note Proceeds Amount, (iv) for any date after the last day of such 18 month period through the date
which is 24 months after the Issue Date, 25% of the Note Proceeds Amount and (v) for any date after the last day of such 24 month, zero.
"
Maximum Other Restricted Payment Amount
" means (i) for the fiscal year ending December 31, 2015, $5 million, (ii) for the
fiscal year ending December 31, 2016, (a) $5 million increased by (b) the percentage increase (if any) of Adjusted Consolidated ENI EBITDA of the Company or, following the
PTP Conversion, the PTP Parent for the fiscal year ending December 31, 2015 as compared to Adjusted Consolidated ENI EBITDA of the Company for the fiscal year ended December 31, 2014 and
(iii) for any fiscal year ending after January 1, 2017, (a) the Maximum Other Restricted Payment Amount for the immediately preceding fiscal year increased by (b) the
percentage increase (if any) of Adjusted Consolidated ENI EBITDA of the Company or, following the PTP Conversion, the PTP Parent for the immediately preceding fiscal year (the
"
base year
") as compared to Adjusted Consolidated ENI EBITDA of the Company or the PTP Parent, as applicable, in the fiscal year immediately prior to
the base year.
"
Maximum Permitted Warehouse and Other Investment Amount
" means (i) for the fiscal year ending December 31, 2015, $100 million (the
"
Initial Maximum Permitted Warehouse and Other Investment Amount
"), (ii) for the fiscal year ending December 31, 2016, (a) the
Initial Maximum Permitted Warehouse and Other Investment Amount increased by (b) the percentage increase (if any) of Adjusted Consolidated ENI EBITDA of the Company or, following the PTP
Conversion, the PTP Parent for the fiscal year ending December 31, 2015 as compared to Adjusted Consolidated ENI EBITDA of the Company for the fiscal year ended December 31, 2014, and
(iii) for any fiscal year ending after January 1, 2017, (a) the Maximum Permitted Warehouse and Other Investment Amount for the immediately preceding fiscal year increased by
(b) the percentage increase (if any) of Adjusted Consolidated ENI EBITDA of the Company or, following the PTP Conversion, the PTP Parent for the immediately preceding fiscal year (the
"
base year
") as compared to Adjusted Consolidated ENI EBITDA of the Company or the PTP Parent, as applicable, in the fiscal year immediately prior to
the base year.
"
Maximum Seed Fund Investment Amount
" means (i) for the fiscal year ending December 31, 2015, $80 million (the
"
Initial Maximum Seed Fund Investment Amount
"), (ii) for the fiscal year ending December 31, 2016, (a) the Initial Maximum Seed
Fund Investment Amount increased by (b) the percentage increase (if any) of Adjusted Consolidated ENI EBITDA of the Company or, following the PTP Conversion, the PTP Parent for the fiscal year
ending December 31, 2015 as compared to Adjusted Consolidated ENI EBITDA of the Company for the fiscal year ended December 31, 2014, and (iii) for any fiscal year ending after
January 1, 2017, (a) the Maximum Seed Fund Investment Amount for the immediately preceding fiscal year increased by (b) the percentage increase (if any) of Adjusted Consolidated
ENI EBITDA of the Company or, following the PTP Conversion, the PTP Parent for the immediately preceding fiscal year (the "
base year
") as compared to
Adjusted Consolidated ENI EBITDA of the Company or the PTP Parent, as applicable, in the fiscal year immediately prior to the base year.
"
Money
" shall have the meaning accorded to such term in the UCC.
"
Moody's
" means Moody's Investors Service, Inc. or any successor to the rating agency business thereof.
"
NAIC
" means the National Association of Insurance Commissioners.
"
Net Cash Proceeds
" means, with respect to any Asset Sale, the proceeds in the form of Cash or Cash Equivalents, including non-cash consideration and
payments in respect of deferred payment obligations
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when
received in the form of Cash or Cash Equivalents, received by the Company or any of the Restricted Entities from such Asset Sale, net of, without duplication:
(1) reasonable
out-of-pocket expenses and fees relating to such Asset Sale (including, without limitation, legal, accounting and investment banking fees and sales
commissions);
(2) the
Company's good faith estimate of taxes paid or payable in respect of such Asset Sale after taking into account any reduction in Consolidated tax liability due to
available tax credits or deductions and any tax sharing arrangements;
(3) repayment
of Indebtedness secured by a Lien permitted under the Indenture that is required to be repaid in connection with such Asset Sale; and
(4) appropriate
amounts to be provided by the Company or any Restricted Entity, as the case may be, as a reserve, in accordance with GAAP, against any liabilities associated
with such Asset Sale and retained by the Company or any Restricted Entity, as the case may be, after such Asset Sale, including, without limitation, pension and other post-employment benefit
liabilities, liabilities related to environmental matters and liabilities under any indemnification obligations associated with such Asset Sale, but excluding any reserves with respect to Acquired
Indebtedness.
"
Obligations
" means, with respect to any Indebtedness, any principal, interest (including, without limitation, Post-Petition Interest), penalties, fees,
indemnifications, reimbursements, damages, and other liabilities payable under the documentation governing such Indebtedness, including in the case of the new notes, the Indenture.
"
Officers' Certificate
" means a certificate signed by two Authorized Officers of the Company or, following the PTP Conversion, the PTP Parent, and
delivered to the Trustee.
"
Opinion of Counsel
" means a written opinion of legal counsel, who may be an employee of or legal counsel for the Company (except as otherwise provided
in the Indenture) and who shall be reasonably acceptable to the Trustee.
"
Permitted Acquisition Indebtedness
" means Indebtedness of the Company or any of the Restricted Entities to the extent such Indebtedness was
(i) Indebtedness of a Subsidiary of the Company, or following the PTP Conversion, a Subsidiary of the Company or the PTP Parent, prior to the date on which such Subsidiary became a Restricted
Entity, (ii) Indebtedness of a Person that is merged, consolidated or amalgamated into the Company or a Restricted Entity or (iii) assumed in connection with the acquisition of assets
from a Person;
provided
, that on the date such Subsidiary became a Restricted Entity (in the case of clause (i)) or the date such Person was
merged, consolidated or amalgamated into the Company or a Restricted Entity (in the case of clause (ii)) or such Indebtedness was assumed in connection with an asset acquisition (in the case of
clause (iii)), as applicable, after giving pro forma effect thereto, (a) the Consolidated Net Worth of the Company and the Restricted Entity would be greater than the Consolidated Net
Worth immediately prior to such transaction, (b) the Company, would be permitted to incur at least $1.00 of additional Indebtedness pursuant to paragraph (1) under "Certain
CovenantsLimitation on Incurrence of Additional Indebtedness" or (c) the Consolidated Fixed Charge Coverage Ratio of the Company would be equal to or better than the Consolidated
Fixed Charge Coverage Ratio of the Company immediately prior to such transaction.
"
Permitted Business
" means the business or businesses conducted by the Company and its Subsidiaries as of the Issue Date and any business, services, or
activities ancillary, complementary, incidental, related or similar thereto, or any business activity that is a reasonable extension, development or expansion thereof, including as a result of the PTP
Conversion.
"
Permitted CLO
" means a CLO (a) the collateral manager of which is the Company, the PTP Parent or any of their respective direct or indirect
subsidiaries, (b) with respect to which none of the Company, the PTP Parent or any of their respective Affiliates have the contractual or voting power to direct or
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cause
the direction of the appointment of the members of, or to determine the policies of, such CLO's Board of Directors (or equivalent body), and (c) in which none of the Company, the PTP
Parent or any of their respective Affiliates have any economic interest other than (x) the collateral manager's right to receive management fees and incentive-based revenues and (y) any
Permitted CLO Investment therein;
provided
that the CLOs listed on
Schedule A
to the Indenture
shall be deemed to be Permitted CLOs.
"
Permitted CLO Investment
" means an Investment in (i) up to 100% of the equity in a Permitted CLO; (ii) a portion of some or all of the
credit tranches of such Permitted CLO, or (iii) a combination of the Investments permitted by clauses (i) and (ii) of this paragraph;
provided
that such Investment does not exceed the sum
of (x) the interest in such Permitted CLO held for purposes of compliance with the "risk
retention" regulations in effect in any applicable jurisdiction in which interests in the debt or equity of such Permitted CLO is issued, marketed or sold, and (y) up to an additional 10% of
the economic interest in such Permitted CLO, where such additional Investment is required in order to consummate the issuance of such Permitted CLO.
"
Permitted Holder
" means (i) DFR Holdings LLC, (ii) any Affiliate of DFR Holdings LLC and (iii) any "group" (within
the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) of which any of the Persons specified in clauses (i) or (ii) are
members;
provided
, that no member of the "group" (other than the Persons specified in clauses (i) or (ii)) shall, without giving effect to
Rule 13d-5 of the Exchange Act, have Beneficial Ownership of 50% of more of the Voting Stock of the Company.
"
Permitted Indebtedness
" has the meaning set forth under clause (2) of "Certain CovenantsLimitation on the Incurrence
of Additional Indebtedness."
"
Permitted Investments
" means:
(1) Investments
by the Company or any Restricted Entity in any Person that is, or that result in any Person becoming, immediately after such Investment, a Restricted Entity
or constituting a merger or consolidation of such Person into the Company or with or into a Restricted Entity;
(2) Investments
by any Restricted Entity in the Company;
(3) Investments
in Cash or Cash Equivalents;
(4) any
Investment existing on the Issue Date and any extension, modification or renewal of any Investments existing as of the Issue Date (but not Investments involving
additional advances, contributions or other investments of cash or property or other increases thereof, other than as a result of the accrual or accretion of interest or original issue discount or
payment-in-kind pursuant to the terms of such Investment as of the Issue Date), other than pursuant to terms of such Investment existing on the Issue Date;
(5) Investments
received as a result of the bankruptcy or reorganization of any Person or a foreclosure, or taken in settlement of or other resolution of claims or disputes,
and, in each case, extensions, modifications and renewals thereof;
(6) Investments
made by the Company or the Restricted Entities as a result of non-cash consideration permitted to be received in connection with an Asset Sale made in
compliance with the covenant described under "Certain CovenantsLimitation on Asset Sales and Sales of Subsidiary Stock";
(7) Investments
in the form of Hedging Obligations permitted under clause 2(c) of "Certain CovenantsLimitation on the Incurrence of
Additional Indebtedness;"
(8) prepayments
and credits or advances to customers or suppliers in the ordinary course of business;
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(9) Investments
in any Person to the extent such Investments consist of prepaid expenses, negotiable instruments held for collection and lease, utility and workers'
compensation, performance and other similar deposits made in the ordinary course of business by the Company or any Restricted Entity;
(10) receivables
owing to the Company or any Restricted Entity if created or acquired in the ordinary course of business and payable or dischargeable in accordance with
customary trade terms;
(11) Investments
in a Receivables Entity in connection with a Receivables Transaction; provided, that such Investment in any such Person is in the form of any equity
interest or interests in receivables and related assets generated by the Company or any Restricted Entity and transferred to such Person in connection with a Receivables Transaction;
(12) Permitted
CLO Investments;
(13) Permitted
Seed Fund Investments;
(14) Investments
in Manager Owned Affiliates;
(15) Permitted
Proceeds Investments;
(16) Permitted
Warehouse and Other Investments;
(17) Investments
in Foreign Manager Owned Affiliates, to the extent such Investments are used, directly or indirectly, to make Permitted CLO Investments;
(18) guarantees
(including Guarantees) of Indebtedness permitted under the covenant contained under "Certain CovenantsLimitations on Incurrence of
Additional Indebtedness" and performance guarantees consistent with past practice, and the creation of liens on the assets of the Company or any of the Restricted Entities in compliance with the
covenant described in "Certain CovenantsLimitation on Liens";
(19) Investments
consisting of licensing of intellectual property pursuant to joint marketing arrangements with other Persons;
(20) loans
and advances relating to indemnification or reimbursement of any officers, directors or employees in respect of liabilities relating to their serving in any such
capacity;
(21) any
transaction to the extent it constitutes an Investment that is permitted and made in accordance with the provisions of the second paragraph of the covenant
described under "Certain CovenantsLimitation on Transactions with Affiliates" (except transactions described in clauses (2)(c) and (d) of such paragraph);
(22) loans
and advances to officers, directors and employees for business related travel expenses, moving expenses and other similar expenses, in each case incurred in the
ordinary course of business consistent with past practice; and
(23) lease,
utility and other similar deposits in the ordinary course of business;
provided
, that with respect to any Investment, the Company may, in its sole discretion, allocate all or any
portion of any Investment and later reallocate all or any portion of any Investment to, one or more of the above clauses (1) through (23) so that the entire Investment would be a
Permitted Investment.
"
Permitted Liens
" means any of the following:
(1) statutory
Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens imposed by law incurred in the ordinary
course of
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business
for sums not yet delinquent, being contested in good faith or which would not reasonably be expected to result in a material adverse effect;
(2) Liens
Incurred or pledges, deposits or security under workers' compensation, unemployment insurance and other types of social security, including any Lien securing
letters of credit issued in connection therewith, or to secure the performance of tenders, statutory obligations, stays, performance, indemnity, warranty, payment of rent, insurance arrangements,
releases, surety and appeal bonds, bids, leases, government performance and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money), in each
case, in the ordinary course of business or consistent with past practice;
(3) Liens
upon specific items of inventory or other goods and proceeds of any Person securing such Person's obligations in respect of bankers' acceptances issued or created
for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(4) Liens
securing reimbursement obligations with respect to commercial letters of credit which encumber documents and other property relating to such letters of credit and
products and proceeds thereof;
(5) Liens
encumbering deposits made to secure obligations arising from statutory, regulatory, contractual, or warranty requirements of the Company or a Restricted Entity,
including rights of offset and set off;
(6) Liens
securing Hedging Obligations that relate to Indebtedness that is Incurred in accordance with "Certain CovenantsLimitation on the
Incurrence of Additional Indebtedness" and that are secured by the same assets as secure such Hedging Obligations;
(7) Liens
existing on the Issue Date and Liens securing Refinancing Indebtedness Incurred to refinance Indebtedness that was previously secured by a Permitted Lien (other
than Permitted Liens Incurred pursuant to clause (14) below), provided, that any such Lien is limited to all or part of the same property or assets (plus improvements, accessions, proceeds or
dividends or distributions in respect thereof) that secured (or, under the written arrangements under which the original Lien arose, could secure) the Indebtedness being refinanced or is in respect of
property that is the security for a Permitted Lien hereunder;
(8) Liens
securing Acquired Indebtedness Incurred in accordance with "Certain CovenantsLimitation on the Incurrence of Additional Indebtedness" not
Incurred in connection with, or in anticipation or contemplation of, the relevant acquisition, merger or consolidation; provided, that:
-
(a)
-
such
Liens secured such Acquired Indebtedness at the time of and/or prior to the Incurrence of such Acquired Indebtedness by the Company or a Restricted
Entity and were not granted in connection with, or in anticipation of the Incurrence of such Acquired Indebtedness by the Company or a Restricted Entity, and
-
(b)
-
such
Liens do not extend to or cover any property of the Company or any Restricted Entity other than the property that secured the Acquired Indebtedness
prior to the time such Indebtedness became Acquired Indebtedness of the Company or a Restricted Entity and are no more favorable to the lienholders than the Liens securing the Acquired Indebtedness
prior to the Incurrence of such Acquired Indebtedness by the Company or a Restricted Entity;
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(9) purchase
money Liens securing Purchase Money Indebtedness or Capitalized Lease Obligations Incurred to finance the acquisition, construction, improvement or leasing of
property of the Company or a Restricted Entity used in a Permitted Business; provided, that:
-
(a)
-
the
related Purchase Money Indebtedness does not exceed the cost of such property and shall not be secured by any property of the Company or any Restricted
Entity other than the property so acquired, constructed or improved, and
-
(b)
-
the
Lien securing such Indebtedness will be created within 90 days of such acquisition, construction or improvement;
(10) any
pledge or deposit of cash, government bonds or other property in conjunction with obtaining surety, appeal and performance bonds and letters of credit in the
ordinary course of business;
(11) Liens
in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;
(12) Liens
encumbering customary initial deposits and margin deposits, and other Liens that are customary in the industry and Incurred in the ordinary course of business
securing Indebtedness under Hedging Obligations and forward contracts, options, futures contracts, futures options or similar agreements or arrangements designed to protect the Company and the
Restricted Entities from fluctuations in the price of commodities;
(13) Liens
on accounts receivable or related assets Incurred in connection with a Receivables Transaction;
(14) licenses
of intellectual property granted in the ordinary course of business;
(15) Liens
to secure a defeasance trust to the extent such defeasance is otherwise permitted pursuant to the terms of the Indenture;
(16) Liens
for taxes, assessments or other governmental charges not yet subject to penalties for nonpayment or which are being contested in good faith by appropriate
proceedings provided appropriate reserves required pursuant to GAAP have been made in respect thereof;
(17) minor
survey exceptions, ground leases, encumbrances, easements, sewers, electric lines, telephone lines, rights of others, licenses, rights of way, zoning and similar
restrictions, reservations, restrictions or encumbrances in respect of real property or title defects that do not in the aggregate materially adversely affect the value of said properties (as such
properties are used by the Company or the Restricted Entities) or materially impair their use in the operation of the business of the Company and the Restricted Entities;
(18) leases
and subleases of real property which do not materially interfere with the ordinary conduct of the business of the Company or any of the Restricted Entities;
(19) Liens
arising from Uniform Commercial Code financing statement filings regarding operating leases entered into by the Company or any of the Restricted Entities in the
ordinary course of business;
(20) judgment
Liens not giving rise to an Event of Default;
(21) Liens
on Capital Stock of an Unrestricted Entity;
(22) Liens
in favor of the Company or any Restricted Entity;
(23) leases,
licenses, subleases or sublicenses granted in the ordinary course of business that do not interfere in any material respect with the business of the Company or
any Restricted Entity;
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(24) Liens
on specific items of inventory or other goods and proceeds of any Person securing such Person's obligations in respect of bankers' acceptances or letters of
credit issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;
(25) the
rights reserved or vested in any Person by the terms of any lease, license, franchise, grant or permit held by the Company or any of the Restricted Entities or by a
statutory provision, to terminate any such lease, license, franchise, grant or permit, or to require annual or periodic payments as a condition to the continuance thereof;
(26) banker's
Liens, rights of set-off or similar rights and remedies as to deposit accounts or other funds maintained with a depositary institution or securities
intermediary; or
(27) other
Liens to secure Indebtedness of the Company or any of the Restricted Entities incurred in the ordinary course of business, not to exceed $5.0 million at
any one time outstanding.
"
Permitted Proceeds Investment
" means any Investment not in excess of the amount of the net proceeds of the new notes or the net proceeds of a
Designated Capital Raise;
provided
that (i) such Investment is made in Permitted Warehouse and Other Investments and (ii) the principal
amount of such Investments at no time exceeds the Maximum Note Proceeds Amount (in the case of an Investment of the Note Proceeds Amount) and/or the Maximum Designated Capital Raise Amount (in the
case of an Investment of any Designated Capital Raise Amount) applicable on any date of determination.
"
Permitted Seed Fund
" means an entity or separate account managed by the Company, the PTP Parent or any of their respective direct or indirect
subsidiaries into which the Company, the PTP Parent or any of their respective direct or indirect subsidiaries provides some or all of the assets and/or some or all of the funding used to acquire the
assets to be managed thereunder in order to promote investment therein by parties unaffiliated with the Company, the PTP Parent or any of their respective Affiliates for purposes of generating
management fees or other incentive-based revenue for the Company, the PTP Parent or any of their respective direct or indirect subsidiaries;
provided,
however,
that such entity or separate account will no longer be a Permitted Seed Fund if at any time the value of the economic interest therein of the Company, the PTP Parent
or any of their respective direct or indirect subsidiaries, taken as a whole, exclusive of the economic value of any incentive-based interests thereof that are not based on invested capital, exceeds
(i) 75.0% of the total value of all such economic interests in such entity or separate account on any date following the first 12 months after the date of the initial investment by a
third party therein, or (ii) 49.9% of the total value of all such economic interests in such entity or separate account on any date following the first 24 months after the date of the
initial investment by a third party therein.
"
Permitted Seed Fund Investment
" means an Investment in an entity or a separate account which is a Permitted Seed Fund;
provided
that the aggregate amount thereof, taken
together with all other Investments in Permitted Seed Funds in any calendar year, shall not exceed the
Maximum Seed Fund Investment Amount as of the date of determination.
"
Permitted Warehouse and Other Investments
" means Investments in (i) credit funds managed by the Company, the PTP Parent and any of their
respective direct or indirect subsidiaries, (ii) senior secured
corporate loans, (iii) senior and subordinated corporate loans or bonds, (iv) interests in CLOs and collateralized debt obligations, and (v) Permitted Warehouse SPVs;
provided
that
(x) the principal amount of such Investments in Permitted Warehouse and Other Investments shall not exceed, in the aggregate, the
Maximum Permitted Warehouse and Other Investment Amount as of the date of determination and (y) the portion of the principal amount of such Investments that are Investments in Permitted
Warehouse SPVs shall not exceed, in the aggregate, 50.0% of the Maximum Permitted Warehouse and Other Investment Amount as of the date of determination.
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"Permitted Warehouse SPV
" means a bankruptcy remote special purpose vehicle (a) the collateral manager of which is the Company, the PTP Parent or
any of their respective direct or indirect subsidiaries, (b) which, invests in a portfolio of investments suitable for a CLO at the time of investment and exists for the primary purpose of sale
of the collateral assets it holds to one or more Permitted CLOs or merging into a Permitted CLO; (c) debt financing (including total return swaps) for which, if any, is provided by third
parties not Affiliated with the Company and the recourse of such third parties for a default on such debt financing is limited to the assets of such vehicle, (d) which, should it acquire any
assets from the Company or any Restricted Entity, shall be on terms no less favorable than those that could reasonably be expected to be obtained in a comparable transaction at such time on an
arm's-length basis from a Person that is not an Affiliate of the Company;
provided that
the Permitted Warehouse SPVs listed on
Schedule A
to the
Indenture shall be deemed to be Permitted Warehouse SPVs;
provided further
that
a Permitted Warehouse SPV shall only maintain its status as a Permitted Warehouse SPV until the third anniversary of the initial Investment by the Company or a Restricted Entity into such vehicle
(such date, and any anniversary thereof, a "
Warehouse Termination Date
"), unless, on the Warehouse Termination Date for such Permitted Warehouse SPV,
the Company or, following the PTP Conversion, the PTP Parent, is able to Incur at least $1.00 of additional Indebtedness pursuant to clause (1) of "Limitation on the Incurrence of
Additional Indebtedness;" in which case the then applicable Warehouse Termination Date for such vehicle may, at the Company's or the PTP Parent's (as applicable) option, be extended (on an annual
basis) for up to one year until the next annual Warehouse Termination Date therefor, on which date the Company or the PTP Parent (as applicable) shall be required to meet such Indebtedness test in
order to further extend the Warehouse Termination Date up to an additional one year from the then-current Warehouse Termination Date for such vehicle.
"Person
" means any individual, corporation, limited liability company, partnership, joint venture, joint-stock company, trust, unincorporated
organization, government or any agency or political subdivision thereof or other entity.
"
Post-Petition Interest
" means all interest accrued or accruing after the commencement of any insolvency or liquidation proceeding (and interest that
would accrue but for the commencement of any insolvency or liquidation proceeding) in accordance with and at the contract rate (including, without limitation, any rate applicable upon default)
specified in the agreement or instrument creating, evidencing or
governing any Indebtedness, whether or not, pursuant to applicable law or otherwise, the claim for such interest is allowed as a claim in such insolvency or liquidation proceeding.
"
Preferred Stock
" of any Person means any capital stock of such Person that has preferential rights with respect to dividends, distributions or
redemptions or upon liquidation.
"
PTP Parent Conversion
" means the conversion of the PTP Parent from a Delaware limited liability company to a Delaware limited partnership.
"
Purchase Money Indebtedness
" means Indebtedness Incurred for the purpose of financing all or any part of the purchase price, or other cost of
construction or improvement, including related development costs, of any asset (other than Capital Stock); provided, that the aggregate principal amount of such Indebtedness does not exceed the lesser
of the Fair Market Value of such asset or such purchase price or cost, including any Refinancing of such Indebtedness that does not increase the aggregate principal amount (or accreted amount, if
less) thereof as of the date of Refinancing.
"
Qualified Capital Stock
" means any Capital Stock that is not Disqualified Capital Stock and any warrants, rights or options to purchase or acquire
Capital Stock that is not Disqualified Capital Stock that are not convertible into or exchangeable into Disqualified Capital Stock.
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"
Rating
" means, as determined below:
(1) if
the new notes are rated and monitored by one Rating Agency, then the rating designated by such Rating Agency;
(2) if
the new notes are rated and monitored by two Rating Agencies, then the lower rating; and
(3) if
the new notes are rated and monitored by three or more Rating Agencies, then the second lowest rating.
"
Rating Agencies
" or "
Rating Agency
" means Moody's, S&P or Fitch or any other nationally recognized
statistical rating organization as recognized by the NAIC. In the event that any of Moody's, S&P or Fitch is no longer in existence or issuing ratings, such organization may be replaced by a
nationally recognized United States securities rating agency or agencies, or the case may be, designated by the Company with notice to the Trustee.
"
Receivables Entity
" means a Person in which the Company or any Restricted Entity makes an Investment and:
(1) to
which the Company or any Restricted Entity transfers receivables and related assets in connection with a Receivables Transaction;
(2) which
engages in no activities other than in connection with the Receivables Transaction, all proceeds thereof and all rights (contractual and other), collateral and
other assets relating thereto and any business or activities incidental or related to such business;
(3) no
portion of the Indebtedness or any other obligations (contingent or otherwise) of which:
-
(a)
-
is
guaranteed by the Company or any Restricted Entity (excluding guarantees of Obligations (other than the principal of, and interest on, Indebtedness)
pursuant to Standard Securitization Undertakings);
-
(b)
-
is
recourse to or obligates the Company or any Restricted Entity in any way other than pursuant to Standard Securitization Undertakings; or
-
(c)
-
subjects
any property or asset of the Company or any Restricted Entity, directly or indirectly, contingently or otherwise, to the satisfaction thereof,
other than pursuant to Standard Securitization Undertakings;
(4) with
which neither the Company nor any Restricted Entity has any material contract, agreement, arrangement or understanding (except in connection with a Receivables
Transaction) other than on terms which the Company reasonably believes to be no less favorable to the Company or such
Restricted Entity than those that might be obtained at the time from Persons that are not Affiliates of the Company, other than fees payable in the ordinary course of business in connection with
servicing receivables; and
(5) to
which neither the Company nor any Restricted Entity has any obligation to maintain or preserve such entity's financial condition or cause such entity to achieve
certain levels of operating results.
"
Receivables Transaction
" means any securitization, factoring, discounting or similar financing transaction or series of transactions that may be
entered into by the Company or any of the Restricted Entities in the ordinary course of business pursuant to which the Company or any of the Restricted Entities may sell, convey or otherwise transfer
to any Person (including a Receivables Entity), or may grant a security interest in, any receivables (whether now existing or arising in the future) of the Company or any of the Restricted Entities,
and any assets related thereto, including all collateral
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securing
such receivables, all contracts and all guarantees or other obligations in respect of such receivables, the proceeds of such receivables and other assets which are customarily transferred, or
in respect of which security interests are customarily granted, in connection with securitization, factoring or discounting involving receivables.
"
Receivables Transaction Amount
" means the amount of obligations outstanding under the legal documents entered into as part of a Receivables Transaction
on any date of determination that would be characterized as principal if such Receivables Transaction were structured as a secured lending transaction rather than a purchase.
"
Refinance
" means, in respect of any Indebtedness, to issue any Indebtedness in exchange for or to refinance, replace, defease or refund such
Indebtedness in whole or in part. "
Refinanced
" and "
Refinancing
" will have correlative meanings.
"
Refinancing Indebtedness
" means Indebtedness of the Company or any Restricted Entity issued to Refinance any other Indebtedness of the Company or a
Restricted Entity so long as:
(1) the
aggregate principal amount (or initial accreted value, if applicable) of such new Indebtedness as of the date of such proposed Refinancing does not exceed the
aggregate principal amount (or initial accreted value, if applicable) of the Indebtedness being Refinanced (plus the amount of any premium
(including reasonable tender premiums) defeasance costs and fees required to be paid under the terms of the instrument governing such Indebtedness and the amount of reasonable expenses incurred by the
Company in connection with such Refinancing);
(2) such
new Indebtedness has:
-
(a)
-
a
Weighted Average Life to Maturity that is equal to or greater than the Weighted Average Life to Maturity of the Indebtedness being Refinanced, and
-
(b)
-
a
final maturity that is equal to or later than the final maturity of the Indebtedness being Refinanced; and
"
Registration Rights Agreement
" means the registration rights agreement the Company, the Guarantors as of the date of this offering memorandum and the
initial purchaser will enter into in which the Company and the Guarantors will agree to conduct an exchange offer with respect to the new notes.
"
Required Rating
" means, with respect to the new notes, the lesser of (i) a Rating of "BB" using the S&P ratings scale (or the
equivalent Rating from another Rating Agency), and (ii) the Rating of the new notes immediately prior to the proposed Incurrence (including an issuance of new notes).
"
Restricted Entity
" means any Restricted Subsidiary and, following the PTP Conversion, the PTP Parent.
"
Restricted Payment
" has the meaning set forth under "Certain CovenantsLimitation on Restricted Payments."
"
Restricted Subsidiary
" means any direct or indirect Subsidiary of the Company or, following the PTP Conversion, any direct or indirect PTP Parent
Subsidiary, which at the time of determination is not an Unrestricted Entity.
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"
Revocation
" has the meaning set forth under "Certain CovenantsLimitation on Designation of Unrestricted Entities."
"
S&P
" means Standard & Poor's Ratings Services or any successor to the rating agency business thereof.
"
Sale and Leaseback Transaction
" means any direct or indirect arrangement with any Person or to which any such Person is a party providing for the
leasing to the Company or a Restricted Entity of any property, whether owned by the Company or any Restricted Entity on the Issue Date or later acquired, which has been or is to be sold or transferred
by the Company or such Restricted Entity to such Person or to any other Person by whom funds have been or are to be advanced on the security of such property.
"
SEC
" means the U.S. Securities and Exchange Commission.
"
Securities Act
" means the Securities Act of 1933, as amended, and the rules and regulations of the SEC promulgated thereunder.
"
Senior Indebtedness
" means the new notes and any other Indebtedness of the Company that ranks equal in right of payment with the new notes.
"
Significant Subsidiary
" means any Restricted Subsidiary that would be a "
Significant Subsidiary
" of the
Company or, following the PTP Conversion, the PTP Parent, within the meaning of Rule 1-02 under Regulation S-X promulgated pursuant to the Securities Act (as in effect on the Issue
Date).
"
Standard Securitization Undertakings
" means representations, warranties, covenants and indemnities entered into by the Company or any Restricted Entity
which the Company has determined in good faith are reasonably customary in securitization of receivables transactions.
"
Stated Maturity
," when used with respect to any new note or any installment of principal thereof or any premium or interest thereon, means the date on
which the principal of such note or such installment of principal or premium or interest is scheduled to be due and payable in the documentation governing such instrument, and will not include any
dates on which contingent obligations to repay, redeem or repurchase any such interest or principal prior to the date originally scheduled for the payment thereof are performed.
"
Subordinated Indebtedness
" means (a) with respect to the Company, any Indebtedness of the Company that is by its terms subordinated in right of
payment to the new notes and (b) with respect to any Guarantor of the new notes, any Indebtedness of such Guarantor that is by its terms subordinated in right of payment to its Guarantee of the
new notes.
"
Subsidiary
" means, with respect to any specified Person:
-
(a)
-
any
corporation, association or other business entity, of which more than 50% of the total voting power of shares of Capital Stock entitled (without regard
to the occurrence of any contingency) to vote in the election of directors, managers or trustees thereof is at the time owned or controlled, directly or indirectly, by that Person or one or more of
the other Subsidiaries of that Person (or a combination thereof); and
-
(b)
-
any
partnership, joint venture, limited liability company or similar entity of which more than 50% of the capital accounts, distribution rights, total
equity and voting interests, or limited partnership interests, as applicable, are owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person or
a combination thereof whether in the form of membership, special or limited partnership or otherwise,
provided
that, in all cases, Subsidiary shall not
include any Investment Vehicle even if any such entity would be consolidated with the Company or, following the PTP Conversion, the PTP Parent, under GAAP.
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"
Subsidiary Guarantors
" means each Subsidiary of the Company that delivers a Guarantee under the terms of the Indenture.
"
U.S.
" means the United States of America.
"
UCC
" or "
Uniform Commercial Code
" means the Uniform Commercial Code as in effect on the date of the
Indenture in the State of New York.
"
Unrestricted Entity
" means any Subsidiary of the Company or, following the PTP Conversion, the PTP Parent, Designated as such pursuant to
"Certain CovenantsLimitation on Designation of Unrestricted Entities." Any such Designation may be revoked by delivery of an Officers' Certificate to the Trustee, subject to
the provisions of such covenant.
"
Voting Stock
" with respect to any Person, means securities of any class of Capital Stock of such Person entitling the holders thereof to vote in the
election of members of the Board of Directors (or equivalent governing body) of such Person.
"
Weighted Average Life to Maturity
" means, when applied to any Indebtedness at any date, the number of years obtained by
dividing:
-
(1)
-
the
sum of the products obtained by multiplying:
-
(a)
-
the
amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal or liquidation preference, as the case
may be, including payment at final maturity, in respect thereof, by
-
(b)
-
the
number of years (calculated to the nearest one-twelfth) which will elapse between such date and the making of such payment; by
-
(2)
-
the
then outstanding aggregate principal amount of such Indebtedness.
"
wholly-owned
," when used with reference to a Subsidiary of a Person, means a Subsidiary of which all of the outstanding Capital Stock (other than
directors' qualifying shares and shares issued to foreign nationals under applicable law) is owned by such Person and/or one or more wholly-owned Subsidiaries of such Person.
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