DISCOVERY COMMUNICATIONS,
LLC,
Issuer
DISCOVERY COMMUNICATIONS,
INC.,
Guarantor
U.S. BANK NATIONAL
ASSOCIATION,
Trustee
FIRST SUPPLEMENTAL
INDENTURE
DATED AS OF AUGUST 19,
2009
DATED AS OF AUGUST 19,
2009
$500,000,000 5.625% Senior Notes
due 2019
FIRST SUPPLEMENTAL
INDENTURE
FIRST
SUPPLEMENTAL INDENTURE , dated as of August 19, 2009 (the
“ Supplemental Indenture ”), to the Base
Indenture (defined below) among Discovery Communications, LLC, a
Delaware limited liability company (the “ Company
”), Discovery Communications, Inc., a Delaware corporation
(the “ Guarantor ”), and U.S. Bank National
Association, as Trustee (the “ Trustee
”).
WHEREAS, the
Company has executed and delivered to the Trustee the Indenture,
dated as of the date hereof (the “ Base Indenture
” and, together with this Supplemental Indenture, the “
Indenture ”), providing for the issuance from time to
time of its Securities;
WHEREAS, pursuant
to the terms of the Base Indenture, the Company desires to provide
for the establishment of a new series of its Securities to be known
as its 5.625% Senior Notes due 2019 (the “ Notes
”), the form and substance of such Notes and the terms,
provisions and conditions thereof to be set forth as provided in
the Base Indenture and this Supplemental Indenture;
WHEREAS, the
Company has requested that the Trustee execute and deliver this
Supplemental Indenture, and all requirements necessary to make this
Supplemental Indenture a valid instrument in accordance with its
terms, and to make the Notes, when executed by the Company and
authenticated and delivered by the Trustee, the valid and legally
binding obligations of the Company, and all acts and things
necessary have been done and performed to make this Supplemental
Indenture enforceable in accordance with its terms, and the
execution and delivery of this Supplemental Indenture has been duly
authorized in all respects.
NOW, THEREFORE,
for and in consideration of the premises contained herein, each
party agrees for the benefit of each other party and for the equal
and ratable benefit of the Holders of the Notes, as
follows:
Section 1.01
Capitalized terms used but not defined in this Supplemental
Indenture shall have the meanings ascribed to them in the Base
Indenture.
Section 1.02
References in this Supplemental Indenture to article and section
numbers shall be deemed to be references to article and section
numbers of this Supplemental Indenture unless otherwise
specified.
Section 1.03
For purposes of this Supplemental Indenture, the following terms
have the meanings ascribed to them as follows:
“
Attributable Debt ” means, with respect to a Sale and
Leaseback Transaction, an amount equal to the present value of the
lease payments with respect to the term of the lease remaining on
the date as of which the amount is being determined, without regard
to any renewal or extension options contained in the lease,
discounted at the rate of interest set forth or implicit in the
terms of the lease, compounded semi-annually.
“ Base
Indenture ” has the meaning provided in the
recitals.
“
Exchange Act ” means the U.S. Securities Exchange Act
of 1934, as amended.
“
GAAP ” means generally accepted accounting principles
in the United States set forth in the opinions and pronouncements
of the Accounting Principles Board and the American Institute of
Certified Public Accountants and statements and pronouncements of
the Financial Accounting Standards Board or such other principles
as may be approved by a significant segment of the accounting
profession in the United States, that are applicable to the
circumstances as of the date of determination, consistently
applied.
“
Guarantor ” has the meaning provided in the
preamble.
“
Indenture ” has the meaning provided in the
recitals.
“
Interest Payment Date ” has the meaning provided in
Section 2.04.
“
Lien ” means any mortgage, pledge, hypothecation,
assignment, deposit, arrangement, encumbrance, lien (statutory or
other), charge, or preference, priority or other security interest
or preferential arrangement of any kind or nature whatsoever
(including any conditional sale or other title retention agreement,
any easement, right of way or other encumbrance on title to real
property, and any financing lease substantially having the same
economic effect as any of the foregoing).
“
Notes ” has the meaning provided in the
recitals.
“ Paying
Agent ” has the meaning provided in
Section 2.3(d).
“
Permitted Sale and Leaseback Transaction ” has the
meaning provided in Section 3.02(b).
“ Sale
and Leaseback Transaction ” means any arrangement with
any Person pursuant to which the Company or any Subsidiary leases
any property that has been or is to be sold or transferred by the
Company or the Subsidiary to such person.
“
Supplemental Indenture ” has the meaning provided in
the preamble.
“ Total
Consolidated Assets ” means, as of any date, the total
consolidated assets of the Guarantor and its Subsidiaries computed
in accordance with GAAP as of the last day of the fiscal
2
quarter most
recently ended prior to such date, subject to the second sentence
of the definition of “Debt” in the Base
Indenture.
“
Trustee ” has the meaning provided in the
recitals.
GENERAL TERMS AND CONDITIONS OF
THE NOTES
Section 2.01
Designation and Principal Amount .
The Notes are
hereby authorized and are designated the “5.625% Senior Notes
due 2019,” unlimited in aggregate principal amount. The Notes
issued on the date hereof pursuant to the terms of this Indenture
shall be in an aggregate principal amount of $500,000,000, which
amount shall be set forth in the written order of the Company for
the authentication and delivery of the Notes pursuant to
Section 2.05 of the Base Indenture. In addition, the Company
may, from time to time, without notice to or the consent of the
Holders of the Notes, create and issue additional Notes ranking
equally and ratably with the Notes issued on the date hereof in all
respects (or in all respects except for the payment of interest
accruing prior to the issue date of such additional Notes or except
for the first payment of interest following the issue date of such
additional Notes), so that such additional Notes shall be
consolidated and form a single series with the Notes issued on the
date hereof and shall have the same terms as to status, redemption
or otherwise as the Notes issued on the date hereof.
The principal
amount of the Notes shall be payable on August 15,
2019.
Section 2.03
Form and Payment.
(a) The Notes
shall be issued as global notes, only in fully registered
book-entry form, without coupons, in denominations of $2,000 and
integral multiples of $1,000 in excess thereof.
(b) Principal,
premium, if any, and/or interest, if any, on the global notes
representing the Notes shall be made to the Paying Agent (defined
below) which in turn shall make payment to The Depository Trust
Company as the Depositary with respect to the Notes or its
nominee.
(c) The
global notes representing the Notes shall be deposited with, or on
behalf of, the Depositary and shall be registered, at the request
of the Depositary, in the name of Cede & Co.
(d) U.S. Bank
National Association shall act as paying agent for the Notes (the
“ Paying Agent ”). The Company may appoint and
change the Paying Agent without prior notice to the
Holders.
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Interest on the
Notes shall accrue at the rate of 5.625% per annum. Interest on the
Notes shall accrue from August 19, 2009. Interest on the Notes
shall be payable semiannually in arrears on August 15 and
February 15, commencing on February 15, 2010 (each an
“ Interest Payment Date ”), to the Holders in
whose names the Notes are registered at the close of business on
the August 1 and February 1 immediately preceding such Interest
Payment Date. Interest on the Notes shall be computed on the basis
of a 360-day year comprised of twelve 30-day months. If any
Interest Payment Date is not a Business Day, then the related
payment of interest for such Interest Payment Date shall be paid on
the next succeeding Business Day with the same force and effect as
if made on such Interest Payment Date and no further interest shall
accrue as a result of such delay.
Section 2.05
Other Terms .
The Notes shall be
unsecured senior indebtedness of the Company and shall rank equally
and ratably in right of payment with all of the Company’s
other unsecured and unsubordinated indebtedness outstanding from
time to time. The Notes shall not be convertible into, or
exchangeable for, any other securities of the Company, except that
the Notes shall be exchangeable for other Notes to the extent
provided for in the Base Indenture.
Section 3.01
Limitation on Liens .
(a) The
Company shall not, and shall not permit any of its Subsidiaries to,
create, incur, assume or permit to exist any Lien on any property
or asset, to secure any Debt of the Company, any of its
Subsidiaries or any other Person, or permit any of its Subsidiaries
to do so, without securing the Notes equally and ratably with such
Debt for so long as such Debt will be so secured, subject to the
exceptions set forth in Section 3.01(b).
(b) The
foregoing restriction does not apply, with respect to any Person,
to any of the following:
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(i)
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Liens existing on the date
hereof;
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(ii)
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Liens on assets or property of a
Person at the time it becomes a Subsidiary securing only
indebtedness of such Person or Liens existing on assets or property
at the time of the acquisition of such assets, provided such
indebtedness was not incurred or such Liens were not created in
connection with such Person becoming a Subsidiary or such assets
being acquired;
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(iii)
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Liens on assets created at the time
of or within 12 months after the acquisition, purchase, lease,
improvement or development of such assets to secure all or a
portion of the purchase price or lease for, or the costs of
improvement or development of, such assets;
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(iv)
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Liens to secure any extension,
renewal, refinancing or refunding (or successive extensions,
renewals, refinancings or refundings), in whole or in part, of any
indebtedness secured by Liens referred to in the foregoing clauses
(i) through (iii) or Liens created in connection with any
amendment, consent or waiver relating to such indebtedness, so long
as such Lien does not extend to any other property and the amount
of Debt secured is not increased (other than by the amount equal to
any costs and expenses incurred in connection with any extension,
renewal, refinancing or refunding);
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(v)
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Liens on property incurred in a
Permitted Sale and Leaseback Transaction;
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(vi)
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Liens in favor of only the
Guarantor, the Company or one or more Subsidiaries granted by the
Company or a Subsidiary to secure any obligations owed to the
Guarantor, the Company or a Subsidiary of the Guarantor;
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(vii)
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carriers’,
warehousemen’s, mechanics’, materialmen’s,
repairmen’s, laborers’, landlords’ and similar
Liens arising in the ordinary course of business securing
obligations that are not overdue for a period of more than
90 days or that are being contested in good faith by
appropriate proceedings;
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(viii)
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pledges or deposits in the ordinary
course of business in connection with workers’ compensation,
unemployment insurance and other social security legislation, other
than any Lien imposed by the Employee Retirement Income Security
Act of 1974, as amended;
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(ix)
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deposits to secure the performance
of bids, trade contracts and leases, statutory obligations, surety
bonds (other than bonds related to judgments or litigation),
performance bonds and other obligations of a like nature incurred
in the ordinary course of business;
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(x)
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Liens arising out of a judgment,
decree or order of court being contested in good faith by
appropriate proceedings, provided that adequate reserves with
respect thereto are maintained on the books of the Guarantor, the
Company or the books of their Subsidiaries, as the case may be, in
conformity with GAAP;
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(xi)
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Liens for taxes not yet due and
payable, or being contested in good faith by appropriate
proceedings, provided that adequate reserves with respect thereto
are maintained on the books of the Guarantor, the Company or the
books of their Subsidiaries, as the case may be, in conformity with
GAAP;
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(xii)
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easements, rights of way,
restrictions and similar Liens affecting real property incurred in
the ordinary course of business that do not secure any monetary
obligations and do not materially detract from the value of
the
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property subject thereto or
materially interfere with the ordinary conduct of business of the
Guarantor, the Company or of such Subsidiary;
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(xiii)
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Liens securing reimbursement
obligations with respect to letters of credit related to trade
payables and issued in the ordinary course of business, which Liens
encumber documents and other property relating to such letters of
credit and the products and proceeds thereof;
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(xiv)
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Liens encumbering customary initial
deposits and margin deposits and other Liens in the ordinary course
of business, in each case securing indebtedness under any interest
swap obligations and currency agreements and forward contract,
option, futures contracts, futures options or similar agreements or
arrangements designed to protect the Guarantor or any of its
Subsidiaries from fluctuations in interest rates or
currencies;
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(xv)
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Liens in the nature of voting,
equity transfer, redemptive rights or similar terms under any such
agreement or other term customarily found in such agreements, in
each case, encumbering the Company’s or such
Subsidiary’s equity interests or other investments in such
Subsidiary or other Person;
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(xvi)
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Liens created in favor of a producer
or supplier of television programming or films over distribution
revenues and/or distribution rights which are allocable to such
producer or supplier under related distribution arrangements;
or
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(xvii)
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Liens otherwise prohibited by this
Section 3.01, securing indebtedness which, together with the
amount of Attributable Debt incurred in Sale and Leaseback
Transactions, do not at any time exceed 10% of Total Consolidated
Assets.
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Section 3.02
Limitation on Sale and Leasebacks .
(a) The
Company shall not, and shall not permit any Subsidiary to, enter
into any Sale and Leaseback Transaction (other than a Permitted
Sale and Leaseback Transaction), unless the Company or such
Subsidiary would be entitled to secure the property to be leased
(without equally and ratably securing the outstanding Notes) in a
principal amount equal to the amount of Attributable Debt incurred
in such Sale and Leaseback Transaction.
(b) For
purposes of Section 3.01 and this Section 3.02, “
Permitted Sale and Leaseback Transaction ” means any
of the following: (i) temporary leases for a term, including
renewals at the option of the lessee, of not more than three years,
(ii) leases between only the Company and a Subsidiary or only
between Subsidiaries of the Company, (iii) leases of property
executed by the time of, or within 12 months after the latest
of (A) the acquisition, (B) the completion of
construction or improvement or (C) the commencement of
commercial operation of the property and (iv) any Sale and
Leaseback Transaction regarding the real property in Silver Spring,
Maryland and the Company’s headquarters building located on
such property.
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Section 3.03
Consolidation, Sale, Merger or Conveyance .
(a) In
addition to complying with the provisions of Section 9.01 of
the Base Indenture, the Company agrees that if, as a result of any
consolidation, merger, conveyance, transfer or lease to which such
Section 9.01 applies, properties or assets of the Company or
any Subsidiary would become subject to any lien that would not be
permitted by Section 3.01 hereof without equally and ratably
securing the Notes, (i) the Company or the Person formed by
such consolidation or into which the Company is merged or the
Person that acquires by conveyance or transfer, or that leases, the
properties and assets of the Company substantially as an entirety,
as the case may be, shall take the steps as are necessary to
effectively secure the Notes equally and ratably with, or prior to,
all indebtedness secured by those liens as provided for in
Section 3.01 and (ii) the Officer’s Certificate and
an Opinion of Counsel required by Section 9.01(c) of the Base
Indenture shall also state that such consolidation, merger,
conveyance, transfer or lease and, if a supplemental indenture is
required in connection with such transaction, such supplemental
indenture comply with this Section 3.03(a).
(b) In
addition to complying with the provisions of Section 9.03 of
the Base Indenture, the Guarantor agrees that if, as a result of
any consolidation, merger, conveyance, transfer or lease to which
such Section 9.03 applies, properties or assets of the Company
or any Subsidiary would become subject to any lien that would not
be permitted by Section 3.01 hereof without equally and
ratably securing the Notes, (i) the Guarantor or the Person
formed by such consolidation or into which the Guarantor is merged
or the Person that acquires by conveyance or transfer, or that
leases, the properties and assets of the Guarantor substantially as
an entirety, as the case may be, shall take the steps as are
necessary to effectively secure the Notes equally and ratably with,
or prior to, all indebtedness secured by those liens as provided
for in Section 3.01 and (ii) the Officer’s
Certificate and an Opinion of Counsel required by
Section 9.03(c) of the Base Indenture shall also state that
such consolidation, merger, conveyance, transfer or lease and, if a
supplemental indenture is required in connection with such
transaction, such supplemental indenture comply with this
Section 3.03(b).
(c) Nothing
contained in the last paragraph of each of Sections 9.01 and
9.03 of the Base Indenture shall limit the application of
Section 3.01 hereof to any consolidation or merger of any
Person into the Company or the Guarantor where the Company or the
Guarantor is the survivor of such transaction, or the acquisition
by the Company or the Guarantor, by purchase or otherwise, of all
or any part of the property of any other Person (whether or not
affiliated with the Company or the Guarantor).
Section 4.01
Optional Redemption .
(a) The Notes
shall be redeemable, in whole or in part, at the option of the
Company at any time and from time to time at a redemption price
equal to the greater of:
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(i)
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100% of the principal amount of the
Notes to be redeemed, and
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(ii)
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as
determined by the Quotation Agent (as defined below), the sum of
the present values of the remaining scheduled payments of principal
and interest on the Notes to be redeemed (not including any portion
of such payments of interest accrued as of the date of redemption)
discounted to the date of redemption on a semi-annual basis
(assuming a 360-day year consisting of twelve 30-day months) at the
Adjusted Treasury Rate (as defined below) plus 30 basis points
plus, in each case, accrued interest on the principal amount being
redeemed to the date of redemption.
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(b) For
purposes of this Section 4.01, the following definitions are
applicable:
“
Adjusted Treasury Rate ” means, with respect to any
redemption date, the rate per annum equal to the semi-annual
equivalent yield to maturity of the Comparable Treasury Issue (as
defined below), assuming a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the
Comparable Treasury Price (as defined below) for such redemption
date.
“
Comparable Treasury Issue ” means the United States
Treasury security selected by the Quotation Agent as having a
maturity comparable to the remaining term of the Notes to be
redeemed 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 such Notes.
“
Comparable Treasury Price ” means, with respect to any
redemption date, (i) the average of the Reference Treasury
Dealer Quotations (as defined below) for such redemption date,
after excluding the highest and lowest such Reference Treasury
Dealer Quotations, or (ii) if the trustee obtains fewer than
four such Reference Treasury Dealer Quotations, the average of all
such quotations.
“
Quotation Agent ” means the Reference Treasury Dealer
appointed by the Company.
“
Reference Treasury Dealer ” means (i) each of
Citigroup Global Markets Inc., J.P. Morgan Securities Inc. and
their respective successors; provided, however, that if any of
foregoing ceases to be a primary U.S. Government securities dealer
in New York City (a “ Primary Treasury Dealer
”), the Company shall substitute therefor another Primary
Treasury Dealer; and (ii) any other Primary Treasury Dealers
selected by the Company.
“
Reference Treasury Dealer Quotations ” means, with
respect to each Reference Treasury Dealer and any redemption date,
the average, as determined by the Trustee, 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
Trustee by such Reference Treasury Dealer at 5:00 p.m., New York
City time, on the third
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