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SECOND SUPPLEMENTAL INDENTURE

Addendum or Modifications

SECOND SUPPLEMENTAL INDENTURE | Document Parties: BANK OF NEW YORK MELLON | FRONTIER COMMUNICATIONS CORPORATION You are currently viewing:
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BANK OF NEW YORK MELLON | FRONTIER COMMUNICATIONS CORPORATION

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Title: SECOND SUPPLEMENTAL INDENTURE
Governing Law: New York     Date: 10/1/2009
Industry: Communications Services     Sector: Services

SECOND SUPPLEMENTAL INDENTURE, Parties: bank of new york mellon , frontier communications corporation
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Exhibit 4.1

Execution Version

FRONTIER COMMUNICATIONS CORPORATION

and

The Bank of New York Mellon,

as Trustee

 

 

SECOND SUPPLEMENTAL INDENTURE

Dated as of October 1, 2009


TABLE OF CONTENTS

 

 

  

 

  

 

  

Page

ARTICLE 1. DEFINITIONS

  

2

  

Section 1.01.

  

Generally

  

2

  

Section 1.02.

  

Definitions Used Herein

  

2

ARTICLE 2. TERMS AND CONDITIONS OF THE NOTES

  

10

  

Section 2.01.

  

Designation and Principal Terms

  

10

  

Section 2.02.

  

Issuance of Additional Notes

  

10

  

Section 2.03.

  

Denominations

  

11

  

Section 2.04.

  

Form of Note

  

11

  

Section 2.05.

  

Global Notes

  

11

  

Section 2.06.

  

Other Terms

  

11

ARTICLE 3. COVENANTS

  

11

  

Section 3.01.

  

Limitation on Subsidiary Indebtedness

  

11

  

Section 3.02.

  

Limitations on Liens

  

12

  

Section 3.03.

  

Repurchase of Notes upon a Change of Control Triggering Event

  

14

  

Section 3.04.

  

Termination of Certain Covenants

  

16

  

Section 3.05.

  

Defeasance

  

16

ARTICLE 4. REDEMPTION

  

16

  

Section 4.01.

  

Optional Redemption

  

16

  

Section 4.02.

  

Partial Redemption

  

17

ARTICLE 5. MISCELLANEOUS

  

18

  

Section 5.01.

  

Ratification of Indenture

  

18

  

Section 5.02.

  

Governing Law

  

18

  

Section 5.03.

  

Direction to Trustee

  

18

  

Section 5.04.

  

The Trustee

  

18

  

Section 5.05.

  

Successors

  

18

  

Section 5.06.

  

Severability

  

18

  

Section 5.07.

  

Counterpart Originals

  

18

  

Section 5.08.

  

Table of Contents, Headings, etc

  

18

EXHIBIT A

  

A-1

 

i


SECOND SUPPLEMENTAL INDENTURE, dated as of October 1, 2009 (this “Supplemental Indenture”), between FRONTIER COMMUNICATIONS CORPORATION, a Delaware corporation (the “Company”), and THE BANK OF NEW YORK MELLON, a New York banking corporation, as trustee (the “Trustee”).

W I T N E S S E T H :

WHEREAS, the Company and the Trustee have duly executed and delivered an Indenture, dated as of April 9, 2009 (the “Base Indenture”), as supplemented and amended by the First Supplemental Indenture, dated as of April 9, 2009 (the “First Supplemental Indenture” and, together with the Base Indenture, the “Indenture”), providing for the authentication, issuance and delivery of notes to be issued in one or more series from time to time by the Company (the “Securities”);

WHEREAS, pursuant to the terms of the Base Indenture, the Company desires to provide for the establishment of a new series of Securities to be known as its 8.125% Senior Notes due 2018 (the “Notes”) to be issued under the Indenture in an aggregate principal amount of $600,000,000, which may be authenticated and delivered as provided in the Base Indenture;

WHEREAS, the Company desires to supplement and amend the provisions of the Indenture to issue the Notes;

WHEREAS, Section 9.01 of the Base Indenture expressly permits the Company, when authorized by a Board Resolution, and the Trustee, upon the written request of the Company, to enter into one or more supplemental indentures for the purposes, inter alia , of providing for the issuance of and establishing the forms and terms of Notes of any series as permitted by Sections 2.01 and 2.02 of the Base Indenture, and permits the execution of such supplemental indentures without the consent of the Holders of any Notes then Outstanding;

WHEREAS, for the purposes hereinabove recited, and pursuant to a Board Resolution and due corporate action, the Company has duly determined to execute and deliver to the Trustee this Supplemental Indenture;

WHEREAS, the Company has requested that the Trustee execute and deliver this Supplemental Indenture;

WHEREAS, no consent of any Holder is required to execute and deliver this Supplemental Indenture; and

WHEREAS, all conditions and requirements necessary to make this Supplemental Indenture a valid and binding instrument in accordance with its terms have been done and performed, and the execution and delivery hereof has been in all respects duly authorized.

 

1


NOW, THEREFORE, in consideration of the covenants and agreements set forth herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and the Trustee mutually covenant and agree as follows:

Article 1. Definitions .

Section 1.01. Generally . Unless the context otherwise requires:

(a) A term not defined herein that is defined in the Base Indenture has the same meaning when used in this Supplemental Indenture;

(b) A term defined anywhere in this Supplemental Indenture has the same meaning throughout;

(c) A reference to a Section or Article is to a Section or Article of this Supplemental Indenture; and

(d) All dollars are United States dollars.

Section 1.02. Definitions Used Herein . For all purposes of this Supplemental Indenture, except as expressly provided or unless the context otherwise requires, the terms defined in this Section 1.02 shall have the respective meanings specified in this Section 1.02.

Acquired Indebtedness ” means Indebtedness of a Person existing at the time such Person becomes a Subsidiary of the Company or Indebtedness of a Subsidiary of the Company assumed in connection with an Asset Acquisition by such Subsidiary; provided such Indebtedness was not Incurred in connection with or in contemplation of such Person becoming a Subsidiary or such Asset Acquisition.

Adjusted Treasury Rate ” means, with respect to any redemption date:

 

 

(1)

the yield, under the heading which represents the average for the immediately preceding week, appearing in the most recently published statistical release designated “H.15(519)” or any successor publication which is published weekly by the Board of Governors of the Federal Reserve System and which establishes yields on actively traded United States Treasury securities adjusted to constant maturity under the caption “Treasury Constant Maturities,” for the maturity corresponding to the Comparable Treasury Issue (if no maturity is within three months before or after the Remaining Life, yields for the two published maturities most closely corresponding to the Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate shall be interpolated or extrapolated from such yields on a straight line basis, rounding to the nearest month); or

 

2


 

(2)

if such release (or any successor release) is not published during the week preceding the calculation date or does not contain such yields, the rate per annum equal to the semi-annual equivalent yield to maturity of the Comparable Treasury Issue, calculated using a price for the Comparable Treasury Issue (expressed as a percentage of its principal amount) equal to the Comparable Treasury Price for such redemption date.

The Adjusted Treasury Rate shall be calculated on the third Business Day preceding the redemption date.

Asset Acquisition ” means (1) an investment by the Company or any of its Subsidiaries in any other Person pursuant to which such Person shall become a Subsidiary or shall be merged into or consolidated with the Company or any of its Subsidiaries; or (2) an acquisition by the Company or any of its Subsidiaries of the property and assets of any Person other than the Company or any of its Subsidiaries that constitute substantially all of a division, operating unit or line of business of such Person.

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 such term is used in Section 13(d)(3) of the Exchange Act, such “person” shall 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.

Capital Lease Obligations ” means Indebtedness represented by obligations under a lease that is required to be capitalized for financial reporting purposes in accordance with GAAP. The amount of Indebtedness shall be the capitalized amount of the obligations determined in accordance with GAAP consistently applied.

Capital Stock ” means, with respect to any entity, any and all shares, interests, participations or other equivalents (however designated) of or in such entity’s Common Stock or other equity interests, and options, rights or warrants to purchase such Common Stock or other equity interests, whether now outstanding or issued after the Issue Date.

Change of Control ” means the occurrence of any of the following:

 

 

(1)

the adoption of a plan relating to the liquidation or dissolution of the Company;

 

3


 

(2)

any “person,” as such term is used in Section 13(d)(3) of the Exchange Act, becomes the Beneficial Owner, directly or indirectly, of more than 50% of the voting power of the Voting Stock of the Company; provided that a transaction in which the Company becomes a Subsidiary of another Person shall not constitute a Change of Control if (a) the stockholders of the Company immediately prior to such transaction beneficially own, directly or indirectly through one or more intermediaries, 50% or more of the voting power of the outstanding Voting Stock of such other Person of whom the Company is then a Subsidiary and (b) immediately following such transaction no person (as defined above) other than such other Person, Beneficially Owns, directly or indirectly, more than 50% of the voting power of the Voting Stock of the Company; or

 

 

(3)

the first day on which a majority of the members of the Board of Directors of the Company are not Continuing Directors.

Change of Control Triggering Event ” means the occurrence of both a Change of Control and a Ratings Decline.

Commodity Agreement ” means any forward contract, commodity swap agreement, commodity option agreement or other similar agreement or arrangement.

Common Stock ” means:

 

 

(1)

in the case of a corporation, corporate stock;

 

 

(2)

in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;

 

 

(3)

in the case of a partnership or limited liability company, partnership or membership interests (whether general or limited); and

 

 

(4)

any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person.

Comparable Treasury Issue ” means the United States Treasury security selected by an Independent Investment Banker as having a maturity comparable to the remaining term of the Notes that would be utilized, at the time of selection and in accordance with customary financial practice in pricing new issues of corporate debt securities of comparable maturity to the remaining term of the Notes (“ Remaining Life ”).

 

4


Comparable Treasury Price ” means, for any redemption date, (1) the average of four Reference Treasury Dealer Quotations for such redemption date, after excluding the highest and lowest Reference Treasury Dealer Quotations, or (2) if the Independent Investment Banker obtains fewer than four such Reference Treasury Dealer Quotations the average of all such quotations.

Continuing Director ” means, as of any date of determination, any member of the Board of Directors of the Company who:

 

 

(1)

was a member of such Board of Directors on the Issue Date; or

 

 

(2)

was nominated for election or elected to such Board of Directors with the approval of a majority of the Continuing Directors who were members of such Board at the time of such nomination or election.

Credit Facilities ” means one or more debt facilities or commercial paper facilities, in each case with banks or other lenders, including the Rural Telephone Finance Cooperative, providing for revolving credit loans, term loans, receivables financings, including through the sale of receivables to such lenders or to special purpose entities formed to borrow from such lenders against such receivables, letters of credit or other borrowings, including capital markets debt, in each case, as amended, restated, modified, renewed, refunded, replaced or refinanced in whole or in part from time to time.

Currency Agreement ” means any foreign exchange contract, currency swap agreement or other similar agreement or arrangement.

Designated Subsidiary ” means any Subsidiary of the Company (a) the Capital Stock of which the Company intends to distribute to its shareholders or (b) the assets or Capital Stock of which the Company intends to sell or otherwise dispose of to any Person other than the Company or any of its Subsidiaries, in each case, as evidenced by a Board Resolution.

Disqualified Stock ” means any class or series of Capital Stock of any Person that by its terms or otherwise is (1) required to be redeemed prior to the Stated Maturity of the Notes, (2) redeemable at the option of the holder of such class or series of Capital Stock at any time prior to the Stated Maturity of the Notes or (3) convertible into or exchangeable for Capital Stock referred to in clause (1) or (2) above or Indebtedness having a scheduled maturity prior to the Stated Maturity of the Notes.

 

5


Fair Market Value ” means the price that would be paid in an arm’s length transaction between an informed and willing seller under no compulsion to sell and an informed and willing buyer under no compulsion to buy, as determined in good faith by the Board of Directors, whose determination, unless otherwise specified, shall be conclusive if evidenced by a Board Resolution.

GAAP ” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and in the statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as have been approved by a significant segment of the accounting profession, as in effect from time to time. All ratios and computations contained or referred to in this Supplemental Indenture and the Base Indenture shall be computed in conformity with GAAP applied on a consistent basis.

Global Notes ” means, individually and collectively, each of the Notes that is a Global Security, issued in accordance with Section 2.05 hereof, substantially in the form of Exhibit A hereto.

Guarantee ” means any obligation, contingent or otherwise, of any Person directly or indirectly guaranteeing any Indebtedness of any other Person and, without limiting the generality of the foregoing, any obligation, direct or indirect, contingent or otherwise, of such Person (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 agreements to keep-well, to purchase assets, goods, securities or services (unless such purchase arrangements are on arm’s-length terms and are entered into in the ordinary course of business), to take-or-pay, or to maintain financial statement conditions or otherwise) or (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 the term “Guarantee” shall not include endorsements for collection or deposit in the ordinary course of business. The term “Guarantee” used as a verb has a corresponding meaning.

Incur ” means, with respect to any Indebtedness, to incur, create, issue, assume, Guarantee or otherwise become liable for or with respect to, or become responsible for, the payment of, contingently or otherwise, such Indebtedness; provided that (1) any Indebtedness of a Person existing at the time such Person becomes a Subsidiary shall be deemed to be incurred by such Subsidiary at the time it becomes a Subsidiary and (2) neither the accrual of interest nor the accretion or amortization of original issue discount nor the payment of interest or dividend in the form of additional Indebtedness shall be considered an Incurrence of Indebtedness.

 

6


Indebtedness ” means, with respect to any Person at any date of determination (without duplication):

 

 

(1)

all indebtedness of such Person for borrowed money;

 

 

(2)

all obligations of such Person evidenced by bonds, debentures, notes or other similar instruments;

 

 

(3)

all obligations of such Person in respect of letters of credit or other similar instruments (including reimbursement obligations with respect thereto, but excluding obligations with respect to letters of credit (including trade letters of credit) securing obligations entered into in the ordinary course of business of such Person to the extent such letters of credit are not drawn upon or, if drawn upon, to the extent such drawing is reimbursed no later than the fifth Business Day following receipt by such Person of a demand for reimbursement);

 

 

(4)

all obligations of such Person to pay the deferred and unpaid purchase price of property or services, which purchase price is due more than one year after the date of placing such property in service or taking delivery and title thereto or the completion of such services, except Trade Payables;

 

 

(5)

all Capital Lease Obligations of such Person;

 

 

(6)

all Indebtedness of other Persons secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person; provided that the amount of such Indebtedness shall be the lesser of (A) the Fair Market Value of such asset at such date of determination and (B) the amount of such Indebtedness;

 

 

(7)

all Indebtedness of other Persons Guaranteed by such Person to the extent such Indebtedness is Guaranteed by such Person;

 

 

(8)

to the extent not otherwise included in this definition, obligations under Interest Rate Agreements, Commodity Agreements and Currency Agreements, except for Interest Rate Agreements, Commodity Agreements and Currency Agreements entered into for the purpose of fixing, hedging or swapping interest rate, commodity price or foreign currency exchange rate risk; and

 

 

(9)

all Disqualified Stock issued by such Person with the amount of Indebtedness represented by such Disqualified 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.

 

7


The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all unconditional obligations as described above and, with respect to contingent obligations, the maximum liability upon the occurrence of the contingency giving rise to the obligation, provided :

 

 

(A)

that the amount outstanding at any time of any Indebtedness issued with original issue discount is the face amount of such Indebtedness less the remaining unamortized portion of the original issue discount of such Indebtedness at such time as determined in conformity with GAAP;

 

 

(B)

that money borrowed and set aside at the time of the Incurrence of any Indebtedness in order to prefund the payment of the interest on such Indebtedness shall not be deemed to be “Indebtedness” so long as such money is held to secure the payment of such interest; and

 

 

(C)

that Indebtedness shall not include:

(I) any liability for federal, state, local or other taxes;

(II) workers’ compensation claims, self-insurance obligations, performance, surety, appeal and similar bonds and completion guarantees provided in the ordinary course of business;

(III) obligations arising from the honoring by a bank or other financial institution of a check, draft or similar instrument drawn against insufficient funds in the ordinary course of business, provided that such Indebtedness is extinguished within two business days of its Incurrence; or

(IV) any Indebtedness defeased or called for redemption.

Independent Investment Banker ” means one of the Reference Treasury Dealers appointed by the Company.

Interest Rate Agreement ” means any interest rate protection agreement, interest rate future agreement, interest rate option agreement, interest rate swap agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge agreement, option or future contract or other similar agreement or arrangement.

Issue Date ” means October 1, 2009.

 

8


Lien ” means, with respect to any property or assets, including Capital Stock, any mortgage or deed of trust, pledge, lien, hypothecation, assignment, deposit arrangement, security interest, charge, easement or zoning restriction that materially impairs usefulness or marketability, encumbrance, security agreement, Capital Lease Obligation, conditional sale, any other agreement that has the same economic effect as any of the above, or any sale and leaseback transaction.

Moody’s ” means Moody’s Investor Services, Inc. or any successor rating agency.

Permitted Amount ” means, at any time, the sum of (a) 10% of the value of the consolidated total assets of the Company and (b) 20% of the sum of the total consolidated current assets and net property, plant and equipment of the Company, in each case, as shown on, or computed from, the most recent quarterly or annual consolidated balance sheet filed by the Company with the Commission or provided to the Trustee.

Ratings Agencies ” means Moody’s and S&P.

Ratings Decline ” means the occurrence of the following on, or within 90 days after, the date of the public notice of the occurrence of a Change of Control or of the intention by the Company or any third-party to effect a Change of Control (which period shall be extended so long as the rating of the Notes is under publicly announced consideration for possible downgrade by any of the Ratings Agencies): (1) in the event that the Notes have an Investment Grade Rating by both Ratings Agencies, the Notes cease to have an Investment Grade Rating by one or both of the Ratings Agencies, or (2) in any other event, the rating of the Notes by either of the Ratings Agencies decreases by one or more gradations (including gradations within ratings categories as well as between rating categories) or is withdrawn.

Reference Treasury Dealer ” means any of the primary U.S. Government securities dealers in New York City.

Reference Treasury Dealer Quotations ” means, with respect to each Reference Treasury Dealer and any redemption date, the average, as determined by the Independent Investment Banker, of the bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of its principal amount) quoted in writing to the Independent Investment Banker at 5:00 p.m., New York City time, on the third Business Day preceding such redemption date.

S&P ” means Standard & Poor’s Rating Services, a division of The McGraw-Hill Companies, Inc., or any successor rating agency.

 

9


Stated Maturity ” means, (1) with respect to any debt security, the date specified in such debt security as the fixed date on which the final installment of principal of such debt security is due and payable and (2) with respect to any scheduled installment of principal of or interest on any debt security, the date specified in such debt security as the fixed date on which such installment is due and payable.

Subsidiary ” means, with respect to any Person, any corporation, association or other business entity of which more than 50% of the voting power of the outstanding Voting Stock is owned, directly or


 
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